Matomy SVP Erez Gross on the Mobile Advertising Market – RTB, Native Ads and Mobile Media Buying

James Cooper

In Mobile Advertising

September 16, 2014

Erez Gross, is the SVP of Display and Mobile at Matomy Media Group and spoke with us about his views on the mobile advertising market and where it’s heading as well as some insights into how Matomy is positioning itself in terms of some of these trends.  
What are some of the new products and services you’ve been working on at Matomy?
It’s an exciting time at Matomy. Following our IPO in July on the London Stock Exchange, we have increased our capital investment and are making major investments across the company, with a particular focus on enhancing our mobile capabilities. In terms of mobile, we have been focusing on building out our independent RTB abilities and creating an internal technology that will allow us to seamlessly connect to publishers and SSPs, while simultaneously delivering quality, scale and performance to our clients. We are building upon theknowledge and expertise gained from our performance-based advertising model, while fully utilizing our data capabilities.
Another area in which we are increasingly focusing our attention is the connection between mobile and social. We recognize that a considerable amount of users’ time on their mobile devices is spent on social media channels, so we are continuing to work on ways to help advertisers take full advantage of this through campaigns that utilize a mix of what we refer to as Burst, Sustain and Monetize. Through Matomy’s multichannel performance media mix, we are able to offer advertisers and app developers a unique solution for rapidly reaching and acquiring new customers, growing and sustaining that customer base and, specifically for app developers, monetizing their user base.
You mentioned RTB and SSPs. These, along with the rise of programmatic buying and a number of ad networks repositioning themselves as DSPs, and an increase in exchange-based trading seem to be major trends in the industry right now. What do you think all of this means for mobile performance marketing?
What we are seeing is a fundamental shift within mobile advertising. The positioning, or perhaps re-positioning, process the mobile ad sector is now experiencing, where companies are presenting themselves as SSPs or DSPs, is similar to what occurred not that long ago with regard to web and display advertising. In the case of mobile advertising, we will likely see an ongoing move from closed ecosystems to a more open trading world.
In terms of mobile ad networks, trading has always been strong. What is occurring is an evolution, not a revolution, in methods and techniques. Matomy has been carefully watching the developments in the market, and rather than simply responding to every change, we have been strategically charting a course forward. This, in part, is what has led us to strengthen the technology behind our RTB capabilities and data, as well our professional team.
Another major trend in the mobile advertising space is the growth in native ad formats, with a number of companies launching products in this space. What sort of mobile ad format innovation are you focusing on at Matomy?
“Native ads” is a bit of a buzz word right now, and as with most buzz words, what people think it means and what it really is may be quite different. Native ads are not so much a singular thing as an idea based around incorporating the ad in a non-disruptive way within the broader user experience. Many things can count as native ads. The success of some forms of digital advertising is far better than others, and there are instances where it may not be beneficial at all. We have seen some positive results with native advertising, but it’s an emerging ad format and we are continuing to find new ways to integrate it where appropriate. Rather than chasing after every new trend that gains attention, we are taking a more strategic approach at Matomy by developing a broad range of multi-channel and multi-monetization mobile capabilities to best serve our advertising clients and publishers with their customer acquisition and monetization needs.
How is the AppNexus partnership working out and what else has been going on in the business?
We are happy with our partnership with AppNexus, which entails the development of a mobile media buying offering on the AppNexus platform. As one of the dominant players in real-time online advertising, AppNexus has incredible access to scale, something that our direct partnership with them has allowed us to offer our clients.
Does the recent news that Google Play is now classifying games featuring in-app purchase as ‘paid’ create a greater role for mobile games advertising?
My sense is that the main effect will be fairly short lived. It will take users some time to adjust to the new layout, but over time the effect will likely decrease. In the beginning, the organic push will be a little harder, so it is likely that clients will invest more in paid advertising. But, the market is fairly fast moving and adaptable so I think that users will get use to this before it will have any real lasting effect.
Some analysts such as Benedict Evans have suggested that chat apps such as Line or Whatsapp will play an increasingly important role in areas such as app distribution and discovery. What impact do you think the rapid growth in the usage of these aps will have on mobile advertising?  
There is no doubt that chat apps are becoming an ever more present part of users’ mobile life. “Chat” is not the proper definition for these apps. They have a broader appeal and should be defined as social apps. In fact, among today’s teens and millennials the use of these social apps has been increasingly replacing the use of traditional social media channels like Facebook. While their impact has been wide reaching, their effect on app distribution and discovery remains a bit unclear.
In terms of monetization, chat apps have begun to find a way to make money, with some of the Asia based platforms like Kakao showing some early signs of success. The most common chat app in the US market, WhatsApp, was recently acquired by Facebook for an eye-watering $16 billion, so what will become of it is still an open question. Based on what we have seen until now from Facebook and their approach to mobile it seems reasonable to assume that they may move in the direction of increased advertising. If they do, however, it is less clear how WhatsApp users, who are not use to any intrusions, will respond.
With over 300 ad networks active in the market right what is your advice for advertisers that are trying to evaluate the right media and distribution partner?  
Online marketing is growing at an exponential rate, and in a few years will surpass all other forms of marketing. Like in any large industry, there are a number of players in the field, Matomy included, and this is often advantageous for everyone. The difference with digital marketing is that because it is still a relatively new industry, people tend to not understand it as well as those of us who work in the industry would like. That’s not their fault; it’s on all of us who work in digital marketing to educate our potential clients, media partners and others on the immense benefits of performance-based marketing.mThere are many solutions available but the market can often be confusing for both publishers and the advertisers.
The advice I would give advertisers trying to evaluate who is the right partner is that you need to really know and understand the solution you need before you look for a partner. Invest in learning about your marketing partner – what is the company’s background, track record of success, specific areas of expertise and capabilities, etc. Be aware of your KPIs and the measurement tools that your marketing partner will need to provide you in order to effectively measure their work. If your marketing partner can’t clearly demonstrate how their work will drive real results and customer actions, then they likely aren’t worth the investment in your time and money.
What mobile devices are you using right now and will you be getting an iPhone 6 once it is released? 
iPhone 5. I tried switching to Android a few times, but in the end I always end up back with an iPhone. I can’t wait for the new iPhone to come out and plan on upgrading to it as soon as I can.
What’s your favorite mobile app and mobile game?  
In terms of apps, it’s definitely WhatsApp and Waze. I use both daily and can’t get around life and work without them. As for games, I have more than 100 on my iPhone. Most are for my son who is quite a few years away from having his own smartphone.
What’s the one thing in mobile advertising you would like to change and why?
I’m not so sure that I would choose to change the industry as much as I would change how users perceive mobile advertising and its contribution. Once users understand what mobile advertising does, the fact that it allows them to consume free content, apps and services. My hope is that it would significantly shift the horizon. Unlike the image advertising industry, we as an industry help users understand the value of the ads, we may just find a point in which users, app developers, and advertisers are all on the same side.
Thanks Erez for the interesting views on the way the mobile advertising market is heading. You can find out more about Matomy over on their website or on the Matomy profile in our directory