There is a dearth of large volumes of quality inventory in Southeast Asia and India, and this is preventing programmatic buyers from scaling their campaigns and reaching the audience they want.

This, however, is set to change as publishers in the region are pragmatic and will want to have the ability to trade programmatically at scale, according to Jason Barnes, PubMatic's Asia-Pacific vice president. In this Q&A with ExchangeWire, Barnes discusses the challenges and opportunities publishers in the region face, and how they should transform their monetisation strategies to address changes in consumer behaviour.

ExchangeWire: What opportunities, as well as challenges, do local publishers face in Asia-Pacific?

Jason Barnes: First, Asia-Pacific is a huge and diverse area with many localised forces, so no one answer is suitable for the region. What can be said broadly is that the opportunity is significant as users have migrated to the internet at a rapid rate and are using their mobile phones as the primary access channel. Publishers that adopt a 'mobile-first' strategy, or have a strong mobile offering, will attract greater audience and, therefore, revenues. That said, advertising dollars flowing into mobile still do not reflect the scale and levels of engagement that audiences provide to advertisers on mobile. It seems marketers are hesitant to commit their budget and publishers are, hence, not duly rewarded for their efforts to build large mobile audiences.

Finding good talent is a challenge, too, and is a hot conversation topic. Publishers from Sydney, to Mumbai, to Singapore are trying to find experienced digital and ad tech professionals; and there are very few available. A lot of time needs to be invested in training. Exacerbating this talent shortage is a lack of committed local expertise from some technology vendors; even though publishers require support in their timezone across a number of areas such as sales strategy, demand enablement, and deep technical expertise to ensure their goals can be achieved.

Jason Barnes, PubMatic’s Asia-Pacific vice president

I think one of the biggest opportunities in developing markets, such as India and across Southeast Asia, is in ecommerce and, perhaps more specifically, m-commerce. We are seeing explosive growth in markets such as Thailand and India from users outside metropolitan areas who do not have access to fixed broadband and large shopping centres, so all consumption is done via their mobile phones.

How have changes in consumer behaviour impacted the way Asia-Pacific publishers operate?

Some of the global trends we are observing around the evolution of media and the impact of technology on consumer behaviour do apply to most markets in Asia-Pacific, although their developments are at different stages and the way these changes are addressed by publishers differs. Readers have more options now on which platform to get their media fix, accessing content from a variety of devices and filtering for relevance. They expect personalisation, shareability, and everything to be delivered in real-time.

To deal with this change, publishers are being forced to adapt traditional practises and engage more with technology. Content management systems are being overhauled, newsrooms are being redesigned, customer data is being captured, stored, and monetised, and sales teams are having to learn new ways to sell.

How should Asia-Pacific publishers transform their monetisation strategies to address these market changes?

A critical step in dealing with these market changes is to first get your strategy right. Each business is different and needs to take time to evaluate its capabilities, internal structures, business models, and customer needs to ensure the plan they put in place, as well as the partners they choose, will result in a sustainable business that is attractive to both their customers as well as their advertisers. There is a high level of discussion around programmatic trading, and publishers should first think through the right course of action.

My view is that there are three fundamental elements that need to be at the heart of a progressive publisher's monetisation strategy in the programmatic age. First, they need an engaged and knowledgeable sales team, along with appropriate structures and remuneration that drive positive behaviour. Second, they should establish ad tech partnerships that are aligned with a publisher's strategy and able to provide tools and support that enable the publisher to differentiate and flourish. Finally, they should have a solid understanding of the buyers – be they brands, agencies, or trading desks – and what these clients look for, so that products can be developed to meet their needs, too.

If they have not done so already, the obvious first step is that publishers should allow their inventory to be traded programatically. Budgets continue to shift to this channel and the workflow efficiencies that programmatic offers in an increasingly complex advertising ecosystem will hold the publisher in good stead.

There are a large variety of tech companies out there, but key considerations should include cross-platform capabilities, in-depth real-time analytics, integration with the demand side, and localised support.

Publishers should closely look at harnessing the power of their data to increase customer engagement through personalisation, as well as drive higher yield by offering targeted advertising. I have yet to see large amounts of budget committed to audience targeting this year; but the shift will most certainly come, and those who are not prepared will lose out.

What has been the most valuable tool, enabled by real-time analytics, for publishers in this region, and how have they benefited from it?

The ability to have data sources from all sales channels, in real-time, and within one interface has been a revelation. Publishers are used to having to log into a multitude of websites to retrieve all the data sources they require to support their negotiations with buyers, or on-the-spur reporting requests, and getting information that is 12-hours outdated. Real-time reporting capabilities, such as those offered by PubMatic, have enabled faster decision making across video, mobile, and desktop that allow a more holistic approach to pricing inventory correctly.

What are advertisers demanding that publishers are still unable to provide for, be it for the lack of available technology, tools, or data?

One of the biggest issues I am seeing is the lack of large volumes of quality inventory that are available to the programmatic buying community in Southeast Asia and India. This prevents them from scaling their campaigns and reaching the audience they want, in the environments they want. This will change in the second half of this year, as publishers are very pragmatic in the region and actively engaging with technology companies like PubMatic to better understand the opportunity. My prediction is that by the end of 2015, we will see most premium publishers across Southeast Asia and India trading programmatically, at scale. Japan and Australia are a little more progressive in terms of making available larger volumes of inventory for trading.

There is also no large scale quality first-party audience data in the market, which I think agencies would be willing to buy, if given the opportunity.

Are you seeing different levels of adoption and maturity in terms of programmatic among publishers within Asia-Pacific?

As mentioned above, I would say Japan and Australia are the most mature as far as adoption, revenue, and inventory volumes are concerned. In Southeast Asia, it is Singapore and Malaysia that lead and I would put India just a short way behind them, but it is moving faster. I see a lot of activities are coming out of China with Baidu, Alibaba, and Tencent – being technology companies at heart – are embracing ad tech.

What are some barriers to adoption that are unique to publishers in this region?

Things like language and currency can cause issues, as publishers and buyers want to use a user interface in their native language, or see everything in local currency. Some tech players have not localised their products sufficiently, which can make them less sticky. Talent is an issue too. I have heard publishers say that they do not want to implement programmatic until they have hired staff with the correct skillsets, so they can ensure they gain maximum value from our platform. The lack of education also can be a blocker. Although this is not necessarily unique to this market, the problem is more prevalent. If a publisher does not fully grasp how the technology works, and how it will integrate with their existing tech and processes, then they will be hesitant to proceed.