Demand-side platforms are getting snapped up left and right. But DataXu, one of the remaining indies, is planning to stay that way.
And it’s hitching its wagon to the in-housing trend.
“There’s a lot of interest in having greater transparency and control over programmatic technology,” said Mike Baker, CEO and co-founder of DataXu, which released a new, more simplified user interface to improve customer workflow on Wednesday.
Streamlining the UI has been an imperative for the company. DataXu got high marks in Forrester’s 2015 DSP Wave for its optimization and machine learning capabilities, but the report criticized the platform for being difficult to use.
“And that came at a time when the self-serve business model was really taking off,” said Aaron Kechley, DataXu’s SVP of product and marketing.
As more brands and agencies start to roll up their sleeves and place their hands on keyboards – Baker said the majority of DataXu’s clients use the platform to manage their own media – usability becomes increasingly important.
While The Trade Desk pursues deals at “the mega level,” like the ones it’s inked with WPP, Omnicom, Publicis Groupe, IPG, MDC Partners and Dentsu Aegis Network, middle-market agencies present a material opportunity, Baker said.
DataXu’s been somewhat quiet over the last year or so, but that doesn’t mean the DSP hasn’t been participating in bake-offs and drumming up business. The company claims to have been profitable for the last 18 months.
“Anyone managing media anywhere can potentially be a self-serve customer,” Baker said, pointing to growing momentum with smaller agencies just starting to get their feet wet with programmatic.
One example is Beamly, a digital and social agency owned by beauty products manufacturer Coty, which acquired a number of beauty brands from Procter & Gamble last year, right around the same time Carat and Adform vet Anthony Rhind joined Beamly as chief operating officer.
Beamly uses DataXu on a self-serve basis.
“We see brands experimenting with a number of different programmatic models, and that’s related to usability,” Baker said.
Not all brands are going to bring their media buying in-house by acquiring an agency of their own, but it’s still a “sign of the times,” Baker said. Agency self-serve is the fastest-growing segment of DataXu’s business.
“Everyone is aware that the I/O business is diminishing and that the market is ‘platformizing,’” he said. “That’s us responding to what’s happening in the market rather than us responding to any specific competitor.”
DataXu comes up against The Trade Desk, of course, as a meaningful competitor for agency dollars, as well as MediaMath, TubeMogul and Turn. But it’s Google’s DoubleClick Bid Manager that seems to have the largest market share.
“We estimate that they’re at least three times bigger than The Trade Desk,” Baker said.
Although the short list of independent DSPs is getting ever shorter, with Singaporean telco Singtel’s acquisition of Turn in February as the most recent example, DataXu isn’t looking for a suitor, at least not for now.
“We’re blessed to have patient money behind us,” Baker said.
DataXu has raised $68.5 million since it was founded in 2009, mostly recently a $10 million venture round led by UK-based telecom company Sky in January of last year.
For the foreseeable, DataXu plans to stay head down on product development, especially related to its cross-device tool, OneView, and to focus on what Kechley referred to as “full data activation.”
In other words, solving cross-device data-related headaches, like cookie stability, cookie matching, latency between systems, incomplete first-party data profiles and scaling first-party data sets.
It’s an effort that also extends to television. In early February, DataXu expanded an existing partnership with Acxiom to license the latter’s third-party data for advanced TV targeting and analytics.
“We’re focused on expanding the universe of what’s addressable,” Baker said.