Challenges in dealing with publishers and advertisers: Harish Bahl, CEO, Smile Interactive Technologies

Harish Bahl, founder and CEO of Smile Interactive Technologies, spoke to domain-b on the sidelines of IAMAI's fourth conference on digital marketing, about dealing with publishers and advertisers, and on secrets of picking the right agency. Dhruv Tanwar reports.

Harish Bahl has an in depth perspective of the online advertising business. After all, as the agency guy, he's caught in the crossfire between the advertisers and publishers, and is often the guy left holding the bill when things go downhill in the absence of standards and norms. (view video)

Taking to domain-b about the various challenges in dealing with publishers and advertisers, in terms of standards to be set, Bahl says that first things first, there is an urgent need to concentrate on the development of standards and norms where an agency is not seen a body which is there to harm the advertiser or the publisher.

''When an agency talks to an advertiser, it is actually an 'extended arm' of the publisher, and plays a neutral role where we bring in the capabilities to identify the right opportunities, plan and buy at the best price. So we need at least some data, some norms that will help prove the credibility of the overall medium. Otherwise, if the credibility of the medium is questionable, it's a big challenge,'' says Bahl.

That makes credible, unquestionable data the first imperative component that proves to the advertiser that the medium is trustworthy, and he can go ahead with advertising on the publisher's website. Bahl says that once this trust is established, only then can the agency can work closely with the publisher to get the right kind of ads onto the website to get their revenues going.

So how do publishers go about choosing an ad network? Bahl says that to answer that question, you have to ask another simple question. ''Why would a publisher choose an ad network?''

Bahl says that no publisher today would have a 100 per cent sell through, and depending on their sales capabilities, it would range between 30 and 70 per cent. So, one of the reasons would be that the publisher wants to ensure that their entire unused inventory, which forms a large percentage of the total inventory, is addressed adequately, which is an area of competence for an agency.

Secondly, if a publisher chooses the right ad network, there is a very strong opportunity for him to increase yield, as against what is directly monetised from his inventory. An ad network extends the publisher's exposure to a new set of clients and brands, which otherwise may have been out of reach.

When asked about what advise the has for publishers that would help them choose the right network, Bahl candidly replies that the ad network industry today is evolving, and therefore there is no straight answer to the question of choosing the right network.

Choosing the right network, says Bahl, is purely dependent on how well you can work with the partner you choose to.

''Before you decide the partner, you need to see where their strengths are'', says Bahl.

For example, one network may be very strong on entertainment based inventory, and another would be strong on tech inventory, while a third could be a horizontal ad network.

''As a publisher, you need to see whether your inventory maps correctly with the capabilities of the ad network that you are choosing.''

The other important point to consider is what is there in it for the ad network. He points out that some ad networks would take a publisher seriously even on a two million inventory, while others would demand at least a minimum of 15 to 20 million of inventory before they give any mindshare to the publisher.

A third factor, which is also very important, is that there should be a provision of a decent window of learning built into the partnership when you sign up an ad network.

Bahl says a lot of publishers go wrong when they expect that the tag they've put in will materialise magically in a short period.

He says there is no magic to achieving mutual goals, and there is no substitute to working closely with your ad network partner.

''Evaluate what works and what does not,'' says Bahl, for only then can the relationship get into that evolved state when you as a publisher are really monetising your inventory and yield in a better way.

On the performance vs branding aspect of advertising online, Bahl points out that in the first generation of the internet, it has evolved more as a performance medium than a brand medium.

''But I think that is a factor of time, with more bandwidth coming in, the advertiser base increasing, that percentage is surely going to change'', he says.

''If you see the current set of advertisers, vis-à-vis advertisers from a year ago, larger spends came from dot com or transactional or commoditised kind of advertisers. There was not that much spend from FMCG or the brand guys. While I'm not saying that performance is going to go away, it is a fact that we will have to accept that the internet or mobile, or digital when said in a combined way, is going to create enough performance based opportunity, brand building opportunities, and is the most high engagement medium as of now.''

''Every advertiser will have to, when they work out their split between spends on digital, will very clearly know what percentage of spend is going into each of these opportunities. So, if anyone thinks its all going to be CPA, that's not true. If anyone thinks CPM alone can survive, that also is not true. All of them are here to stay'', he says.

(Also See: The time has come for online video advertising)
The need for standards and norms for the next wave of growth of the internet
Five imperative's for online industry's growth in India