VivaKi is starting to get very active in the APAC market - and is spearheading the Publicis move into data-driven display buying across the region. Here Ros Allison Director of VivaKi Nerve Center in Australia discusses Vivaki's exchange strategy in the Australian market and how automated buying is getting traction in online display there.

In terms of the automated buying how far is the Australian market behind Europe and the US?  Can you give some overview on the local market?

Technology has moved quickly, we’re only months behind the US in some areas, with competition and diversified offerings certainly still to come.  Data and market liquidity are still developing, as you’d expect in a smaller more concentrated market.  The development curve has been steep, and we’ve certainly benefitted from the experience of VivaKi’s Audience on Demand desks in the US & UK, with established world’s best practice, tested technology and data infrastructure, and the advantage of global partnerships. 

Some of the big five Australian publishers have publicly outlined concerns about selling their inventory on ad exchanges.  Do you think their fears about downward pressure on CPM pricing are valid?

It’s the commoditization created by the bulk buy that pushes CPMs to rock bottom. It’s the tonnage buy, lowest common denominator impressions, “if you buy enough of it, cheap enough then it will work”.  Exchange-traded inventory has the capacity to change the dynamic.  The potential for data is to allow buyers to truly value individual impressions, eliminating marketing wastage, and placing real value on advertising that can deliver an outcome.  Data as currency, monetizing segments and audiences gives publishers another channel to market.

How can Australian agencies get publishers make more inventory available for automated buys?

There is concern around sales channel conflict, lack of control, pricing freefalls, and a general upending of the established publisher model.  Publishers will increase liquidity once they see that impression level buying can open a viable channel, maximizing the value of inventory not presold, automating processes, while retaining control. 

How do you see the relationship between Australian publishers and exchange traders evolving over the next few years?

We will work more closely with publishers, and in a more meaningful way. 

Exchange trading takes the friction out of transactions, connects publishers to multiple buyers in real time, and provides a more direct and transparent relationship.  It will give us both the capacity, and the insight to work more closely together on the projects that make a difference for our clients and their consumers.   

Ultimately, do you see all agencies having an agent trading desk/ dsp offering as part of their overall mix?

On the surface it’s an easy offering, so I’m sure all agencies eventually will.  And it’s a way of trading that will evolve to other media, mobile, video and TV.  But having the DSP technology is only one part.  Realising the potential of audience buying in a bidded environment requires data infrastructure, experience, partnerships enabling supply and a new skill set to effectively navigate.   But it’s not just something to switch on, or outsource, it requires a real change of thinking in the value proposition for an agency, and our role in our client’s business.

What are going to be the real benefits of exchange trading for Australian advertisers?

For advertisers, it should mean that you buy only the consumers you want, when you want them, and at the right price.  It should eliminate marketing wastage created by a fragmented market, and a focus on contexts as a proxy for audience.  But the exchange and DSP platform just provides access.  You can only unlock real value with a robust data infrastructure, and the skills, experience and insight to create custom audiences at scale.

Is there a massive education gap in the market around automated buying?  How are the agencies educating their clients and the market?

The mechanics of automated buying are fairly straightforward.   The real knowledge gap for agencies is in understanding the potential of their client’s data - making sense of it, and being able to unlock the value from it.  The capacity to manage enormous volumes of data to really understand audiences, to find them, at the right time, and at scale, is where the education gap is, and a much more complex fix.

Finally, do you think the presence and increased use of DSP's will have a larger impact on price and inventory transparency in the Australian market?

Pricing is relatively high here, however the emergence of exchanges and a more transparent market doesn’t equate to price drops at impression level.  The ability to buy impression level inventory with data insight, means that bids are based on what buyers know about that individual impression, and how they value it accordingly.  Transparency and the ability to apply our data learnings is where our clients will see an enormous benefit.