Agencies shouldn’t try to be tech firms: Matt Harty

Harty will be moving from his current post as GM of audience solutions for Experian APAC to SVP of Asia-Pacific for The Trade Desk at the end of the month.

His advice goes both ways, as he also argued that tech firms should stop trying to be agencies.

“Culturally, it’s just a bad fit," he said. "Agencies are not used to having engineers, and engineers aren’t used to working with flamboyant media guys. It can be quite a challenge to get the two to work together.”

He speaks from personal experience, having co-founded the first pan-Asian ad network, SpaceAsia Media, in 1997 and then co-founding Activ8, a yield-management company that preceded today’s programmatic supply-side platforms. He has also held leadership roles at Omnicom Media Group Asia-Pacific, where he was GM of the giant's programmatic arm, Accuen.

Of all the agency holding groups, continued Harty, only WPP has made a real effort at building tech capabilities, and even it is backing away. “WPP was gung-ho about buying an ad network when it purchased 24/7, which has seen been folded into Xaxis," Harty said. "They have since divested themselves of keeping the DSP tech up-to-date, largely selling their ad-serving tech on to AppNexus.”

In general, he commented, agency holding groups are investment-averse and software building is all investment. “For agencies, if you can’t bill it straight to somebody, it’s not going to happen," he said. "Agencies are, however, investing in DMPs, which makes sense. The tech for DSPs, is largely quite fungible. The data in DMPs is not.”

Agencies are also under pressure to streamline. “The media business is being watched very carefully by procurement," Harty said. "They’ve got to be as efficient as possible to maximise the decreasing amount of revenue they can make.”

This doesn’t mean, though, that agencies have no place in the tech universe. “Agencies are here to stay," Harty said. "I’ve got a piece of proof I’d like to offer. We’ve been doing search for nearly 20 years, and it’s all still sitting in the hands of agencies. Very few clients have taken it in-house, and they usually wind up passing it back to the agencies. If it didn’t work for search it’s an even bigger challenge for programmatic.

“Mathematically, clients can’t take programmatic in-house. I just don’t see where the people to do so would come from. We’ve never had enough people for search and in total I’d estimate that there are about 50 really good people in programmatic in Asia. Just take the list of the Fortune 500 firms—that’s 10 times more companies than people who exist.”

Harty also firmly believes that The Trade Desk’s decision to work only with agencies is the right approach. “It differentiates itself by staying on the right side of the agencies—to not force them to work with a potential rival.”

Harty's decision to join The Trade Desk after less than a year with Experian was due to the ‘gravity’ of programmatic. “Just when you think you’re out, they drag you back in," he joked. "There are just so many senior jobs and I thought, well, I’d like to have an entire division to run.”

After looking around, Harty chose to work with The Trade Desk because it was a “business I would bet on”. “I think the big thing that separates our trade desk is that it’s more of an advanced trader’s tool than a beginner’s. The tech is superior. It has more levers to pull and buttons to push, as my ex-Accuen colleague Peter Burton would put it.”

Harty also took into account the small amount of VC funding that The Trade Desk has had to take and its swift move to profitability. “Plus, I get to work with the very wonderful Mr Andrew Tu [APAC managing director at The Trade Desk] and I hero-worship the founder, Jeff Green.”

As there is nothing Harty doesn’t overanalyse, he also added that after examining the culture at The Trade Desk, he found it to be a “hugely charismatic organisation”.

“It is!" he said. "It’s run charismatically. Everybody is fully engaged.”

Harty’s role at The Trade Desk will be focused on strategy and product, while Tu will continue to run operations. “One thing that was expressed to me about my new role is that a lot of companies seem to think one person in charge of Asia-Pacific is enough," Harty said. "But this firm believes that an entire management team is needed here. The way they see it, APAC is 75 per cent of the world’s population, and the company should be putting a huge focus on starting this properly. Client management will be broken out at some later stage.”

The tech firm established its first Asia-Pacific office in Singapore in July 2013 and, led by client demand, has since opened offices in Seoul, Tokyo and Sydney. Strategically, the markets Harty is eyeing next for The Trade Desk include China and Indonesia. “These choices are tied to the programmatic strength of our agency partners, of which Xaxis, Omnicom and Vivaki are the big ones,” he said.