Why Baltimore is Necessary for the Transformation of AdTech

We’re in the early stages of a complete transformation of the AdTech industry, and we should expect significant change for the remainder of this year and next.? Our industry is faced with several challenges including:

• #streaming platforms will be forced to increase revenue and reduce costs/losses all while vying for an increased subscriber base
• #retailmedia Networks must address challenges like platform optimization, data fragmentation, measurement standards and overall platform proliferation.
• #data and #privacy regulations will continue to evolve, creating obstacles and confusion as pending legislation, DOJ intervention and other forces muddy the waters
• #marketers have too many avenues for spend and activation to be efficient?
• #publishers are faced with challenges to capture their audience, and effectively monetize their business while maintaining (or increasing) the quality user experience
• #dsps and #SSPs face are at an inflection point, and must evolve to meet the needs of their partners

Before we can face any of those challenges, we need to focus on financial recovery, investment and growth. ? Our industry needs PEOPLE and PLACES to lead this transformational journey.? ? We’re seeing the early stages of cost management through massive reductions in force.? In Q4 '22, Layoffs.fyi reported 462 companies with layoffs, which resulted in 81,186 people losing their jobs.? In Q1’23 so far, an additional 397 companies have laid off 108,986 workers.? From a cost perspective, headcount reduction typically provides the most immediate impact, but it doesn’t solve the issue completely.???

Prior to RIFs, organizations were already faced with managing real estate/office space costs. ? Until recently, many companies did not have return to office policies, and to date, many still have hybrid and/or remote work models. ? Offices are half full at best, while commercial real estate costs haven’t changed much.?

AdTech companies must invest wisely to recover, evolve, and grow to overcome the challenges I’ve listed earlier in the article. ? A continued belief that the AdTech industry must be concentrated within a few cities doesn’t create potential for growth and recovery, it just resets the cycle.? The economics simply don’t make sense.? This is where the Greater #Baltimore region comes into play.

People

The Greater Baltimore region hosts a wealth of AdTech talent from entry level to seasoned executives.? Companies like 亚马逊 , 雅虎 , The Trade Desk , Lotame , Jellyfish ,? Fyber , Digital Turbine ,? IBM , 甲骨文 , PubMatic , Beachfront , Insider. , Criteo , HUMAN , Flywheel , Unruly , ICARO? Media Group and many others have employees from this region currently, many who work in remote and/or hybrid models.? While many began their careers at Advertising.com and Millennial, the local AdTech community also attracts talent from the companies like Legg Mason (Acquired by Franklin Templeton) , T. Rowe Price , Northrop Grumman , Booz Allen Hamilton , and others whose offices sit within Baltimore or within the greater metropolitan area.? The professional AdTech community is a close-knit community who leans on one another for success.? We are made up of Supply and Demand side experts, Analysts and Operations leaders, Engineers and Product Managers, Marketing visionaries, Finance and Accounting professionals, and many more.?

In addition to its current workforce, the Greater Baltimore area is surrounded by prominent D1 and D2 universities ( The Johns Hopkins University , Loyola University Maryland , 美国马里兰大学帕克分校 , Towson University , University of Maryland Baltimore County ), and has several majors and programs that develop talent for the AdTech industry. ? #UMBC (University of Maryland, Baltimore County) is home to a nationally renowned ‘Women in Tech’ program, that continues to produce leaders whose expertise spans multiple industries.? The University Economic Development (UEDA) association selected Towson University StarTUp as the Engaged University winner in its 2022 Awards of Excellence, edging out Ivy league schools as part of the competition. ? There is a massive pool of young, entrepreneurial talent in the Greater Baltimore area for AdTech companies to invest in with a far more reasonable cost when compared to other cities.??????

Places (Greater Baltimore Region)

As I mentioned earlier, organizations will be focused heavily on #ebitda moving forward. ? Putting payroll aside for now, the next large cost centers are commercial real estate and expenses.? Baltimore’s average cost per square foot for commercial real estate is $26.82 according to CommercialCafe.com. Baltimore’s Southeast neighborhood (most desirable) hails the highest cost per square foot at $34.82 and is still less than the national average. ? Here’s how that compares to other major metropolitan areas keeping in mind the values below are averages, and do not reflect the more prominent neighborhoods within the cities:

Understanding that AdTech roles typically require travel, the Greater Baltimore area provides easy access to the NorthEast corridor via Amtrak.? ? Rail travel is far more convenient and cost effective, and requires significantly less downtime for employees when compared to flying. ? The Northeast corridor lines run from Boston to DC, and offer travelers the ease of working individually or collaboratively with various seating arrangements, all while connecting the major metros in a matter of hours. ? Baltimore to NY Penn Station is approximately 2 hours and 40 minutes via the Acela, and 3 hours on the regional lines.? Employee productivity increases based on the nearly seamless process of boarding and traveling via rail versus the hassle of airports and planes, regardless of your Clear or TSA status.?

Airfare costs less coming out of the tri-state area, and is driven by volume. ? That said, the Greater Baltimore area has access to AdTech hubs with direct flights domestically through United and Southwest (Hubbed in Baltimore) coupled with direct international destinations through both BWI and Dulles International (~60 miles south of Baltimore).? There are always going to be areas where some major metros have advantages, and while the tri-state area offers lower air fares, airport parking and overall ease of travel to the airports remains favorable in Baltimore.

Let’s round out this area with employee/client expenses. We're in an industry of team events, dinners, client entertainment and other expenses. ? I am a foodie, and I am not going to compare the variety and caliber of Manhattan restaurants to Baltimore.? Putting your Carbone and Tony Rao’s reservations aside, Baltimore hosts a wide range of international cuisine choices led by Michelin star restaurants, along with fresh seafood and their ever so famous crab cakes, all at a fraction of Manhattan prices.? Hotel rates fall far below the average prices of Manhattan rooms as well. Entertainment like Orioles tickets cost $20+ less than Mets and Yankees tickets.? They are within $1 of SF Giants and LA Dodger tickets with a much nicer stadium. (I've been to all of them)? (source: https://bleacherreport.com/articles/412548-mlb-power-rankings-ticket-price-edition)

The cost of building culture within an organization, along with the expenses that are associated with partner entertainment and growth are a fraction of what you would spend in Manhattan, San Francisco and LA, yet the experience remains invaluable.? Location, Location, Location!!!

People and Places (Bring it all together!)

Payroll is the largest expense most organizations carry.? Compensation within organizations must be competitive to attract the best talent while providing those employees with an opportunity to afford a place to live. ? Current AdTech hubs also host a large number of headquarters or large offices for organizations.? As with any area with a high concentration of similar business, employee attrition and retention become challenging due to competitive salaries, titles or other incentives. Investing in the Greater Baltimore creates greater potential for reduced attrition, and favors employee growth and development.

Major metropolitan areas continually face an increased cost of living which creates stress for residents and has started to push more people from cities to suburbs. ? The commute into Manhattan from bordering suburbs can be as long as 2 hours for some, with most somewhere in the 45-75 minute range, door to door.? (Don’t forget to throw in the monthly fees for your NJ Transit, LIRR, Metrocard and/or other expenses).? Given current inflation and interest rates, the housing market may see some decreases soon, but pricing is expected to remain well above historical levels for some time. ? Organizations can choose to continually increase compensation to account for increased cost of living in the existing large cities and suburbs, or they can look to invest in smaller markets like Baltimore where the cost of living is significantly less.

?Let’s compare home prices outside NYC versus Baltimore

Shall we talk about rent?? According to RentCafe.com, the average apartment in Baltimore is 824 square feet and costs $1,542 per month.? As with any city, different neighborhoods will have variable costs, but the top end of monthly rent is around $2,400 per month. ? Let’s look at NYC:

In Conclusion

Never put your eggs in one (or four) baskets. ? New York City, San Francisco, Chicago and Los Angeles will always be large destinations for AdTech offices, conferences and other events.? Each area has its advantages, and has provided invaluable contributions to our industry.? There is room for greater expansion.? We’re seeing smaller cities like Nashville, Omaha, and Austin become destinations for AdTech businesses to invest and build out certain functions. ? The evolution of our business must continue, as our lives are becoming more and more entwined with AdTech. ? Baltimore presents the ideal opportunity for AdTech businesses to build out regional offices filled with a mix of seasoned veterans and young, hungry talent. ? The economic landscape creates potential for sustainable, profitable growth, and the talent pool creates endless opportunities for innovation and success.? The proximity to Manhattan and access to LA, SF and Chicago allows for seamless, cost effective travel. Let’s not repeat history and rebuild in the same locations with hopes of different outcomes.? Invest wisely and watch your returns in Baltimore elevate your business to a level you didn’t know was possible.