PubMatic CEO Rajeev Goel on taking on Google, arbitrage and trading desks, and the future of programmatic in Asia

Rajeev GoelRajeev Goel is the CEO of PubMatic, an automated trading firm that sells ads on behalf of publishers such as ESPN, Hindustan Times and MCN.

In this interview with Mumbrella Asia editor Robin Hicks, Goel talks about taking on Google, agency trading desks and arbitrage, and what the demise of Brandscreen said about the programmatic trading space in Asia.

You’re up against the might of Google. How do you compete?

The first thing is, we have a very deep focus on innovation in our space. Because we are a singular business, we can help publishers with advertising strategy and monetisation. We can lead the market in innovation. Google has lot of smart people, but they’re doing a hundred different things, making TVs, self driving cars, etc. The focus for us is on publishers and innovation. We have almost 300 people in our product and innovation department.

Second, our business model is aligned with the needs of publishers. We don’t own any websites. We only make money when a publisher’s clients are growing profitably. Google is one of the largest publishers in the world – they own Gmail, Google Maps and YouTube. So many publishers are concerned about that. If Google has an agenda to sell its own inventory and provide technology to publishers, that’s a significant and real conflict from a publisher’s perspective. Google is more focused on helping adveritisers. We hear from publishers that the publisher’s side is an after-thought for Google.

What do you make of the arbitrage [agencies not declaring how much money they make from trades] debate? Do you think it will become a big issue in Asia?

We spend a lot of time with the likes of Vivaki and Xaxis. We’re seeing that no one size fits all for trading desks. Some use the transparent fee model. Some are less transparent. The value proposition for each is different, but both are valid. The market will sort out which model works best. Some advertisers are more focused on transparency. Others say all we care about is our results improving. Most transactions in the world operate on a similar basis. If you go into McDonald’s, do you ask about the cost of the lettuce and the beef that goes into your burger? No. It costs five dollars and that’s the end of it. Agencies will win or lose based on how their trading affects their clients’ business.

We have reached a transition point in the industry when programmatically enabled platforms are really differentiating themselves from the non-programmatic. Some companies are going through difficult transitions. Millennial Media has brought in new CEO in Michael Barrett, who was formerly CEO of AdMeld [a publisher-side programmatic trading firm]. Recently we saw Rocket Fuel [a loss-making ad tech firm] make an acquisition [of programmatic firm [x+1] for $230 million]. Businesses that were not programmatic are moving into the programmatic arena. To coin the famous quote, programmatic is eating the advertising world. We’re at an exciting time in terms of how the industry is developing. The upshot for APAC is that we’ll see a significant, rapid shift towards programmatic over the next 12 months.

What do you make of the demise of Brandscreen, which went into administration in January this year? What does its demise say about the health of the programmatic sector?

I don’t have specific knowledge on Brandscreen. But I’m familiar with the market situation in Japan, India and Sydney, where we have offices and where Brandscreen has operated. People think about APAC as a region, but once you’re here it is obvious that it is not. It’s 12 different markets. I suspect that one of the challenges for Brandscreen was that they spread themselves too thin. And part of it was down to bad luck. We tackled the US first, which was an easier market for us to attack. What happened to Brandscreen doesn’t say anything about the health of the space on a segment level. But there are lessons for all of us in the execution and operation of Brandscreen.

What are your plans for the next 12 months?

We’re growing rapidly in APAC. We have two people in Singapore, but we’re slated to grow to seven by the end of the year. More broadly, from a sales and marketing perspective, we want to have grown by around 15 to 25 per cent by the end of year. We recently acquired Mocean Mobile [for US$15.5 million, according to a story on AdAge], an ad server for publishers built specifically for the mobile environment. We’ve not yet set up operations for it in APAC, but we aim to this quarter. There are a lot of mobile-first and mobile-only markets in Asia, and we’re looking to invest in scaling our mobile business in APAC.

But the biggest focus for us is really around market education. Some markets like Australia are quite mature, but in other markets such as Southeast Asia less than 10 per cent of digital budgets are programmatic. There’s an opportunity to work hand in hand with agencies and show them how they can benefit. But there’s often not enough supply from publishers. The long-term benefit is that programmatic will drive pricing for publishers, and that will ultimately support more free content they can deliver for their audiences.


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