‘Millennials think news is free and ads are annoying – they need to understand that journalists need to get paid,’ says Xaxis boss

The APAC head of programmatic trading firm Xaxis has said that the rise of ad blockers is a concern that the ad industry has partly created itself, but highlighted the role of the publisher in heading off the threat as the under-covered part of the story.

Michel de Rijk

Michel de Rijk presents at the Malaysian Media Conference last week

Talking at the Malaysian Media Conference in Kuala Lumpur last week, Michel de Rijk, Asia Pacific CEO of Xaxis, said the industry needed to do a better job of ensuring ads reaching people on digital devices were less intrusive and more relevant, but pointed to Yahoo’s move last week to deny access to Yahoo Mail users who have installed ad blocking software as an indication that publishers may not allow ad blockers on their platforms, because it hurts their business.

“No one is writing that story, no journalist is covering that,” he commented, referring to the potential loss in revenue ad blockers could mean for publishers. Yahoo’s action on ad blocking “goes really far,” said de Rijk, but added that “someone needs to maintain the servers.”

“Millennials think news is free and ads are annoying. They need to understand that journalists need to get paid,” he said.

De Rijk added that the ad blocker issue should not be “blown up” as growth of the technology was coming from a small base, an observation echoed by a Forrester analyst a fortnight ago, who told Mumbrella that the rise of ad blocking in Asia has so far been slow.

The Dutchman was also asked a question about brand safety, and why ads often end up on inappropriate websites.

“There are a lot of companies making money from fraudulent activities [on the web]. Our responsibility is to fight that battle together. And it’s not an easy battle,” he said, adding that there were no guarantees that automatically traded ads would find the right targets.

“When we find out that it’s [an ad] delivered in a non brand-safe environment we’ve been surprised as well. On the other side of the business, there are smart companies making money from non brand-safe environments. If you’re chasing for the lowest CPM then there’s a bigger risk [of inappropriatley placed ads].”

“That’s why it’s so important to understand that when working with publishers they are able to deliver ads in a brand safe environment. We do that with upfront media [buying],” he said.

De Rijk took a question from the audience over the transparency of Xaxis’ business model, a question the company has fielded often over the last two years. Xaxis buys digital media upfront, then sells it on to advertisers but does not disclose the margin it makes on a trade, the audience member noted. How then does the firm “manage transparency” with its clients?

De Rijk pointed at the large investments Xaxis makes in new technology to serve its clients, plus additional services laid on top to ensure its clients’ ads are actually seen by their target market, and do not end up in embarrassing places, a problem the CMO of CIMB Adam Wee had suggested that morning had limited the trust marketers have in programmatic trading.

“We’ve always been transparent about the fact that we are a non-disclosed business,” said de Rijk, who added that he did not regard Xaxis as a media agency, and that his firm is “as transparent as Google or Facebook.”

De Rijk also responded to the suggestion that Xaxis enjoys an exclusive relationship with GroupM, benefitting from business channeled from the clients of GroupM media agencies MEC, Mindshare, MediaCom and Maxus.

“If we do not perform, then kick us out [of the media schedule], like you do with any other media supplier,” de Rijk said, adding that over the four years since Xaxis launched in APAC the firm has moved away from a dependence on its parent; 20 per cent of Xaxis’s business now comes from outside of GroupM, with e-commerce players among their biggest clients.


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