Matt Whaley is CEO of UK-based Jemm Media, a real-time network for display advertising. Whaley is also Chairman of IASH (Internet Advertising Sales Houses).
Click below or scroll down for more:
- The Business Model
- Jemm Technology
- Company Momentum And Competitive Set
- Looking At EU Inventory Pools By Country
- Agency Trading Desks
- Growth Plans
- Privacy Risk And IASH
AdExchanger.com: How would you describe your business model?
MW: So if I were to explain our business model, it would be very similar to a sell-side platform (SSP) -similar to AdMeld , from the point of looking up the publishers inventory to create the most amount of yield. But we also go direct to agency.
We are – to coin a phrase – a real‑time network and much more plugged into looking after the publishers, necessarily, and giving the option to the advertisers to buy how they want to buy. What we have found, especially over the last six months, is that a lot of the advertisers are switching their buying habits and are not necessarily doing standard I.O.-based buys.
Whether [the buyers] want to come in through RMX, AppNexus, Turn Media, wherever that may be, they want to do the optimization themselves.
It has been quite interesting because, being the chairman of IASH, I get to see 26 other members and how they work. There’s quite a lot of resistance to move into this type of space and some are trying to slow this process down because it’s going against their model a bit.
But, at Jemm Media, we have tried to offer people the ability to buy however they want.
What’s the difference that you see between what you’re doing now and a traditional ad network?
I think that the brand type, site‑rep type network will probably do the test of time no problem, because there’s still brand money out there. I think the people that don’t really add any value, that are buying off‑the‑shelf ad servers will wither and die very quickly.
In the future, there probably won’t really be anything apart from the equivalent of what we are doing today. I think if you’re not real‑time connected to the advertisers, then I don’t see how you’re going to get any – pounds, dollars, whatever it may be – spend through your network.
I think we can already see it in the UK market. There are guys that weren’t really adding any value that have actually started to disappear or are under massive pressure.
We’re going to see probably something of the likes of a 150% growth year on year. We’ve gone on a huge recruitment drive including new sales director who is coming over from AdPepper in the UK.
Also, we’ve also done a deal with Right Media (RMX) where we’re going to be the first company from the UK market that they’re going to plug into the Right Media RTB beta.
We’re making a lot of noise about what we’re trying to do and we are probably upsetting a few people because our model isn’t straightforward. But it seems to be working. It’s very compelling for publishers and we’ve found that we’re a large breath of fresh air to advertisers because we’re not trying to just get them to give us a set of tags and an I.O.
We’re currently integrating at the moment ‑‑ I’ve already integrated with AppNexus. We’re in the process of integrating with MediaMath, Turn, and a couple of others. My tech guys are getting a little bit upset because they wish there was this one simple way of doing everything and they can plug everybody in. But it’s not and everything has to be specially tailored to everybody’s needs.
On the technology side, what is the technology Jemm Media has that is able to understand that there’s maybe a higher price coming in through another buy‑side source versus, say, through an AppNexus? Can you talk a little bit about that technology and infrastructure you’re building?
We have two bits of technology that Jemm runs. One piece of technology completely built in‑house which is called Optimise, a campaign optimization product in addition to providing inventory and revenue optimization.
Plus we work with a company called Switch Concepts, which has built an ad server that they run for us. Our ad servers, very long ago, got its roots with OpenX, but it’s gone so far from being anything to do with OpenX.
We’ve had to design a custom‑built algorithm to take the real-time bids and process them accordingly. Also to make sure that it physically is the highest priced ad that gets served and that the internal campaigns do not get priority. You’d think that would be a very simple process. It’s not.
What ad formats are you dealing with today and which ones are a part of the real time infrastructure? How does it break out between display versus video and mobile?
It’s literally 95% display and we’re just looking into mobile and video as we speak.
Can you quantify the momentum you’re experiencing?
Year on year, we’re probably 200% up on last year. Last month was our biggest month ever. We are just in the process of setting up two offices – one in San Francisco and a secondary one in Sydney. This is all with no VC backing. And as a network, we run on a gross profit of just under 50%.
What’s your competitive set?
There’s another company that in some respects have a very similar ethos to us – but do not necessarily call themselves a real‑time network – and that would be BannerConnect out of the Netherlands.
They would have similar ideas to what we’re doing and they’ve seen very large growth at the same time as us.
Are you concerned at all about AdMeld, PubMatic, Rubicon, or companies like that?
I get on extremely well with Ben at AdMeld. I know the guys very well. To be honest, I think the cake is so big, I’m not worried about it. We have different strengths and different weaknesses. I actually want us all to be together to try and grow the cake bigger,
What would you say is the key differentiation between yourselves and companies like those?
It would be things like the IASH membership, going to direct, going to agency, probably the very personalized service that we offer. Because we work with publishers to try and create as much physical yield as we can from their inventory.
What is your sense about the different inventory pools by geography?
It’s very interesting, because we do quite a bit of work in Australia, for example. The Australian market is so much more juvenile to the UK. It’s very interesting to deal with the inventory there because it’s generally got a pretty high eCPM on remnant, for example, compared to other countries. Whereas, you compare that to somewhere like Italy and that area, eCPM for remnant is extremely low. You’re talking down to 15 Euro cents, where you’re talking remnant from Australia, it would be more like 60 cents. So it’s very interesting. You’ve got a strong market on an eCPM basis for US inventory. The UK may not as strong as the US at the moment on remnant [monetization] for publishers. Then you’ve also got Australia which is definitely stronger than the UK and a bit stronger than the US.
I think from a network point of view, France is quite an awkward market to get into, because of the nature of how it works over there. Again, Germany and places like that, there’s lots of money around, but they have a lot of performance buys.
Agency trading desks – what is their impact on your business? And what are you seeing from agency trading desks today?
What we’re seeing is very much the upside of that strategy, where we’re getting lots of test budgets. We’ve always had a very longstanding relationship with the MIG in the UK, so part of GroupM. One of our guys in office used to work for them when they were more called B3, rather than the MIG. It’s not uncommon when you look at who is buying our inventory, the highest person on there is the MIG. We generally work with the trading desks and educate them about what’s in our network because there might be a case where we can’t specify an exact site that we’ve got in there because the publisher won’t let us.
That’s what I think that most people aren’t actually doing – trying to educate. They’re just assuming. They take a seat on AppNexus, for example, and people think they are just going to buy inventory and it’s all going to be hunky‑dory. Well, that doesn’t happen.
Can you talk just a little bit, how big is your company today in terms of people and maybe what do you have in terms of growth plans?
We’re currently 20 people for the UK. We’ve got 16 currently in an office on the Thames, just outside of London. And we have four up in Scotland, which are basically account managers. We are looking to put two offices together – one in San Francisco, one in Sydney. Each office will have about four members of staff to start with. Growth‑wise with impressions, currently we’re doing about 1.8 billion ads a month. Within six months that will be about six billion.
What are your plans for those remote offices? Are they going to be selling UK audience or are you looking for just to sell a technology that can access any audience?
What they’ll actually be doing is a few things. Say, for example, what the San Francisco office will be doing is two things. One, they’ll be selling to US businesses is U.S. inventory from a big UK site with US IPs, for example.
Alternatively, it will also be bringing in new inventory sources into the UK market from those countries. So that might be a case where there’s a big US site with UK IPs coming in, and vice versa.
Finally, what risk do you see as related to regulation, consumer privacy and online behavioral advertising?
There is definitely risk there. But I think that as long as the industry carries on pushing forward with its self‑regulation like it has done with things like, for example, IASH, I think that developing governments will be quite happy with what we’re doing. There was a big outcry a few years ago in the UK where there were ads turning up in places where they shouldn’t have been and lots of people got involved. Very heavy self‑regulation came in with IASH and all the key players in the UK market got together to do that.
It’s now happening the same way in the US and Australia.
I think as long as we keep on the ball about self‑regulating ourselves, I think we should be fine. But there’s definitely risk there. If [industry players] don’t want to do it, I think that people who will come and start trying to regulate us, without us being involved.
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