We're building a real-time bidding platform for video in India: Nitin Gupta, Xapads
Xapads media, a digital media agency that utilizes RTB (real-time bidding) compliance, is apparently growing at a fast rate. Since its inception in 2007, the company has managed to make its presence felt in countries like the US and Singapore and now plans to expand its base in Germany and San Francisco. In an interaction with exchange4media, Nitin Gupta, Founder and CEO, Xapads Media, shared his views on how the market has been growing at a breakneck speed and their game-plan to expand their global reach. Besides that, he also focused on how online advertising fraud has been one of the biggest obstacles for brands.
Xapads has grown tremendously over the years. How has the journey been since its inception?
My entrepreneurship journey started in 2004 when I started Xaprio, a software and web application company. Six of us used to sit and work from home. We started building applications, software and started selling it to clients in US and Europe. It worked well till 2009 but then the recession hit. All spends were cut down and there was hardly anyone left who was spending on software. Then we decided to build Xapads. In 2012, we registered the company and began operations. When we began, our target was US and European market but then we set up in India as well.
As of now, we are India's biggest company in this particular segment and globally, we are among the top 50's. Earlier everything was a relationship-based thing as the technology was not sound. It was more like getting work from an agency and getting work done by a publisher. Now we have worked on the technological part.
Online fraud is one of the biggest concerns today. How would you describe your partnership with Pixalate to overcome this problem?
Advertisers pay for the US market but impression actually comes from the third-world countries. Next are malicious ads which are made to plant viruses on user's computers. With more than 50-60 criterias for ad-frauds right now,
Pixalate is the leader in ad fraud protection in this industry right now. Every year, they launch their own rankings of what ad networks or which platform is ranking better as per the quality of inventory they have. It also gives the information real-time and Xapads is about real-time bidding systems, whereby every ad that shows up, goes through an auction and multiple quality checks.
Before showing up an ad impression, we know whether it is genuine or fraud. So we are actually saving the money for our advertisers. Now the advertisers pay for only genuine ads. After this partnership, ad spends of advertisers have dropped. For example, if earlier they were paying $1000 a day, now they are paying $400-500 a day, but they get the quality which is ten times better because every impression is genuine and targeted to audiences. We have partnered with Pixalate and work on a pre-bid solution which lets us know whether the following IP is genuine or if it's a bot or fraud traffic.
With big brands and clients like GroupM, Publicis, Dentsu, etc, come big responsibilities. How do you make your services distinguishable from others in the industry?
We believe in quality and prompt response. Our operation team works round-the-clock. We make sure that there is always someone stationed to look after the traffic and quality. Our competitors work five days a week. Now with companies like Dentsu, GroupM and Publicis, they had a set of rules that they want a certain amount of impressions with good quality, certain bounce rate and all the metrics.
In a business like us, if you are working for only 8-10 hours a day, there are chances of some mistakes happening overnight. So, we have a team that works round the clock, looking after campaigns throughout the day or night, to make sure that quality is good and the metrics specified by the client are met. We have a business sales team that works seven days a week. If a client has any problem or issue on a weekend, we ensure our presence to help them.
With a Xapads base set up in New York and Singapore in 2017, are you planning to branch out in any other geography?
We will set up our base in Germany soon. There have been some segregations in the US so we are planning to start up in Germany this year because the European market is doing well for us. The CPM and affiliates are very high. One more office in San Francisco is in the pipeline but that will totally depend on how well the Germany base works for us. We have partners in Sweden who represent us but we don't have a registered office.
What are your views on the social media ecosystem in terms of recent changes in Facebook and YouTube?
We don't really go deep in social media because all the agencies have their presence there. Social media has one of the good inventory quality right now, as everyone is on social media today. I prefer to call it Vault Garden because once you are inside Facebook you'll be there for a good period of time. Facebook has all your information, they know your likes and dislikes. With all that information, they can target the ad very precisely.
For a company like us, the challenge is that we don't have the same access to data like Facebook. We have built a big consortium now that has around 50 companies participating worldwide including Appnexus, Criteo, etc. Now, we're sharing data with each other. We have set up the DMP platforms, where with the use of DMP, we're sharing the data of the users which we have with each other. With social media changes, we do have some in-house property that we work with, like a site called All about women, car zoom, etc.
The inception and investment for these sites came from us. It is run by a completely different set of editors so we don't have to worry about the content and we just run our ads over there. It's like a barter system. Over the last month, there was a drop in terms of views on the Facebook page, but still, that's a very small part of the business so it didn't affect us much.
What capabilities will Xapads develop in 2018?
We are going big on AI/ML right now. We're bidding very high on video. Internationally we are doing a lot of business in video. We are trying to replicate the same in India and are building a real-time bidding platform for video as well. There's a change in rules in IB standards as now, you need to have a file called ads.txt which is called an authorized digital seller, on every website. It protects the website from fraud or spoofing.
In a recent interview, you spoke about 60 per cent of growth in revenue as your target for the year 2018-19. Do you think this year's budget reveal would affect the same?
We haven't noticed a difference after the budget was released. We are not very sure if we'll plan to invest in blockchain because the governments of many countries are opposing it.
Talking about the market, currently, it is slow but it will pick up eventually this year. After demonetization and GST, things have settled down now. People have started spending money. From January 2018, there has been a significant increase in digital ad spends. If not 60 per cent, I am sure we'll see 50 per cent growth.
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