Silvia Velasco Praga Discusses The Adnetik Offering In Spain And The Spanish Exchange Marketplace
Adnetik opened its office in Madrid last year. What success have you had so far in the Spanish market?
SVP: We launched our first campaign in November 2010. Since then, we have worked with more than 15 advertisers. We have raised a lot of interest in the market. Given that we are first movers in Spain, where adexchanges and real-time bidding are still not known to the general market, we consider this a very good start.
Can you give some overview on the Spanish display market, and how automated ad buying is evolving there?
SVP: The Spanish display market was probably close to 400 million euros in 2010 (based on the IAB figures for H1). It is one of the larger markets in Europe. However, there are significant differences with other countries, particularly when we compare ourselves with the US. Prices in general are much lower, and it is a very results-oriented market. Possibly one of the reasons for this is the impact of the economic downturn, which is hitting Spain hard. It puts enormous pressure on the ROI of advertisers’ spend. But despite the recession, the online display market is still growing by double digits.
Online media buying in Spain is still very traditional and automated platforms – such as ad exchanges, SSPs or DSPs – are still an unknown quantity. It is true there are already different platforms active which we work with – but we are the first company of this kind to officially launch operations in Spain. It has been necessary for us to educate the market, and explain the model to many advertisers and agencies. This new media buying model is creating huge expectations from the demand side. It finally delivers what the online media has been promising for years: audience-buying and granular targeting across dynamic inventory. It also makes it possible to match advertisers’ and publishers’ needs, returning the best results and value for both from an online campaign. Automated ad buying also brings challenges as it is essentially very different to the traditional media buys that advertisers, agencies and ad networks presently do here in Spain. This will require some time, of course. But given the demand from advertisers and agencies, we expect fast development in the Spanish market.
Is there enough dynamic supply available? Who are the main exchanges or SSPs, Adnetik is currently buying from? Are publishers making inventory available through the automated platforms?
SVP: One of the challenges we faced when we launched the operation in Spain was the supply side. We had done tests, and volumes seemed to be reasonable. But you do not have guarantee of the volumes until you start actually buying. It was a nice surprise to see the available inventory was in fact much higher than expected. There are many publishers that have made impressions available in the exchanges, directly or indirectly. Automated platforms are a new attractive alternative for unsold inventory. The number of publishers in the exchanges is increasing every month and we haven’t found any problems in terms of running audience-based campaigns.
There are a few ad exchanges active in Spain offering Spanish inventory, such as Google Adex, RMX or OpenX and a few local players. On the supply side, Improve Digital, AdMeld and other players have already agreements in place with Spanish publishers.
Do you buy impressions from publishers direct?
SVP: Not at the moment. It will require publishers to make their unsold inventory available on a real-time basis. But this is certainly something we’re exploring.
Is Adnetik Spain buying publisher inventory in real-time?
SVP: Yes, that is currently happening now in Spain and that’s exactly what we do!
As the first mover in the Spanish market, how difficult is it educating clients about the value of exchange trading?
SVP: It depends on the client – but for the most part they are extremely interested in our model and want to test it. Some of them have heard about ad exchanges. What is sometimes a bit more complex is illustrating the differences with traditional media buying (i.e. direct or network buys). For instance, many advertisers are used to know in advance the list of the publishers in which their ads will be served, or want to have screen shots of those sites. We argue that our model is different. Each impression is valued in real-time so guaranteeing sites or volumes per site would restrict our ability to deliver superior results. But we also need to be flexible and we are finding a middle ground to facilitate the transition. It is challenging, but we think this is the right way.
Adnetik works closely with Havas in Spain – but are other agencies and advertisers putting budgets through you?
SVP: Havas is certainly a client of ours, and one of the first agencies to use our service in Spain. But we are an independent company and we have other advertisers and agencies which are running campaigns with us. We are also looking for new partnerships with more agencies, as we believe we have a unique offering in the market that they can benefit from.
Will the adverse economic conditions in Spain drive the growth in the automated display market? Or will it restrict budgets?
SVP: Online advertising is still growing despite the recession. The recession is being felt by most people and most industries. But we think this situation will increase the opportunity for more efficient and effective advertising models.
What are we likely to see in the Spanish market over the coming year? Will we see more buy and sell side vendors setting up there?
SVP: Yes, definitely we expect more players in the arena – and this ultimately acelerate growth of the exchange model in Spain.
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