Lucas Mentasti:”Rumors on Trading Desks Charging Outrageous Spreads are Completely Overstated.”
Portada interviewed Lucas Mentasti, who recently was promoted to CEO Latin America by Xaxis. Portada interviewed him to ask him about how he sees Xaxis' development in Latin America and the growth of the LatAm programmatic space in general.
Portada: What are the opportunities for Xaxis in Latin America?
"On the advertisers side, there is an appetite for real, measurable outcomes and not just media delivery. With Xaxis’ help, clients get better at defining and measuring objectives, and ultimately, reducing waste. This is both at a performance level – where clients measure activities on their websites (the travel industry is an excellent example) – and at a branding level, where, by integrating with TV usage data, we can target evasive cord cutters.
On the publisher side, the LatAm media market seems to be divided between super premium take over formats and a low-end, non-verified and non-targeted remnant inventory. We are creating a space in the middle, building media products with verified and targeted ads, supported by our own technology; thus, we will be adding value to publishers and driving their income up."
Publishers need to invest in technology and people to be able to sell programmatically
Portada: It is said that trading desks charge an "outrageous" spread making trading desks very inefficient. What do you have to say on that?
"I believe the rumors around agency trading desks are completely overstated. I would imagine those who simply mark up media (or ad networks) without adding value could have gained significant margins over a short period of time. We have also seen significant margins reported from public companies positioned as advertising technologies (like retargeting specialists or DSPs). This is not the Xaxis business model.
At Xaxis, since day one, we have said we are neither a trade desk nor an agency. We are the world's largest programmatic audience company. We have over 1,500 employees, (260 are engineers), invest over US $50 million annually in our platforms, make forward commitments and take risk on nearly 90 percent of our media. Our number one priority is to provide advantage to our clients.
With our business, it is simple. If we perform, we help our clients drive their objectives and we keep working."
Portada: Does publisher direct media buying still make sense in these times?
"If we use technology and data to add value, then yes – most definitely. Data management platforms (DMPs) like Turbine allow advertisers to reach only the desired audience, and not the overall audience. For example, an advertiser can reach only online newspaper browsers that have shown a previous interest in cars, and not to the rest.
Publishers need to invest in technology (and people) to be able to sell programmatically. As impressions become more valuable, eCPMs will likely to go up."
Portada: What offices are you opening in Latin America, and which markets do you think have the most potential?
"In programmatic, scale is everything; you need scale for technology and talent investment. Mexico is probably the biggest and most advanced market. That’s why we started Xaxis LatAm operations in Mexico in 2013. We will open Peru by the end of 2016, and Chile and Uruguay early next year. These markets are in the early stages in development of programmatic and audience planning, so we will probably have the opportunity to leap-frog more advanced markets."
Check out: More on the evolution of programmatic in Latin America;
Programmatic with a Latin Twist: What's New
Are Latin Publishers adopting Header Bidding: Is the Glass half-full or half empty