Last year Audience Buying Company Xaxis, a unit of Group M (WPP), announced the launch of operations in Latin America in order to bring Data-driven audience buying to Brazil, Mexico, Argentina and 5 other markets. Portada interviewed Lucas Mentasti, Managing Director, Latin America of Xaxis to hear about his operation has been progressing.
To what extent does Latin American Audience Buying facilitate panregional media buying from one point?
Lucas Mentasti, Managing Director, Latin America, Xaxis : “From a technology standpoint, audience buying is definitely moving the industry towards a single source solution for pan-regional media buying. The technology and data platforms we have developed are global, which provides economies of scale and allows for integrated multi-national campaigns. However, while the tech resources are centralized, the human part of the equation – the ability to most effectively harness global tools for specific markets – is not. The in-market audience experts play a vital role in ensuring we get the best results in every market we operate in.”
What percentage of digital media buying is currently done through a programmatic trading in Latin America? What % do you expect for 2014?
L.M.: “If we do not consider self-service platforms from Google and Facebook as pure programmatic, our estimates are that between 5% and 10% of big advertisers’ budgets were bought programmatically in 2013. For this year, we expect that number to grow to 15% to 20%. Mexico seems to be taking the lead, with Brazil and Argentina being close behind.”
How do the acquisitions of 24/7 Media, Crystal Semantics and Bannerconnect impact the way Xaxis works in Latin America?
L.M.: “Xaxis is the leading programmatic media and technology company in the world. We have developed and partnered with leading technology companies to create this leading platform. Additionally, we work closely with leading publishers to provide the largest, premium environment in which to execute campaigns for our advertisers. This requires scale and swiftness. Our merger with 24/7 Media provides both of these with an added level of technology development resources and proprietary digital capabilities. The new Xaxis development team will play a key role as we continue to refine and enhance the capabilities of the industry-leading Xaxis Data Management Platform (DMP). Crystal Semantics brings us additional proprietary technology that can match advertising to the meaning of a web page. Using it, Xaxis can better direct ads to appear in relevant context while providing leading brand safety solutions. At the same time, this same technology matches the users to the meaning of the content they are consuming, building the audience portraits we use to target the ads of our clients.”
Mexico is big enough to attract the attention of global marketing departments that define the vision and objectives for the local initiatives. This leads to shorter adaptation time windows between a global decision and local implementation.
Which of the Latin American countries is most developed when it comes to programmatic trading and why?L.M.: “Mexico, Brazil and Argentina lead the way in terms of innovation and technology adoption. Mexico is generally the easiest market for US-based companies to access because of the closer economic integration between Mexico and the US. Also, Mexico is big enough to attract the attention of global marketing departments that define the vision and objectives for the local initiatives. This leads to shorter adaptation time windows between a global decision and local implementation.”
Portada: Which one is the least and why?
L.M.: “You need a certain scale to operate in the programmatic space, both from the demand side (advertisers, agencies) and the supply side (the publishers). There are human resources investments to be made in the agencies and strong, fixed technology developments to be made from the publisher side.The small countries of Latin America probably don’t have the scale to make this investment profitable in the short run. We are seeing consortiums of local publishers (local newspapers are a classic example) working together to enter the programmatic world, but alignment takes time and effort.”
Portada: What brands have already embraced programmatic trading to reach their Latin American target audiences?
L.M.: “Brands that have strong (and global) measurement systems are the ones that were first to migrate to programmatic. Programmatic outperforms traditional planning in most variables, both for branding and Direct Response. Thus, consistent and detailed scorecard system lead to a bigger adoption of programmatic. Big multinational consumer good products are leading this space. Also, companies that have a measuring component in their DNA, like dot coms or financial institutions have already tested and adopted this space. Mercado Libre and Despegar have always pioneered in this area. American Express is another good example.”