Smartphones are the growth opportunity for RTB in Japan: MediaMath

In 2014, RTB spend in Japan reached $710 million, according to research by Microad, which also predicted that 43 per cent of that spend next year will be in the smartphone market. This represents a golden opportunity for new market entrant MediaMath, as strong local players already dominate the desktop programmatic space, said Yokota.  

Furthermore, much of Japan's online traffic is directed towards Yahoo Japan, which remains closed to DSPs with the exception of retargeting firm Criteo, said Yokota, who joined MediaMath in January from iRep.

Despite the country's initially slow adoption of smartphones, usage of the devices has picked up. Now, smartphone penetration in Japan accounts for 46 per cent of the population. Apple is the clear leader with 30 per cent market share. 

"Last year, MediaMath integrated with Apple's iAd to run in-app ad campaigns, so the high usage of iOS in the market is an opportunity for us," said Yokota.

Furthermore, the Japanese are heavy social media users on their mobiles, particularly on Facebook and Twitter. This dovetails nicely with a recent MediaMath acquisition social media advertising optimisation platform - Upcast. MediaMath is also looking into in-mobile-game advertising as a next opportunity. "There's still room for growth," said Yokota.

Overall, while Japan is one of Asia's leading programmatic markets, its maturity in this space is largely mixed, said Yokota. "Marketers in Japan understand programmatic in different ways," he said. "Most think all programmatic is RTB. So the idea is common, but the market's understanding isn't that mature yet."

In the year ahead, Yokota's main challenge will be to build MediaMath's presence in the market, not just as a DSP but also as a marketing operating platform. "I will also need to develop relationships with local key agencies, such as Microad, Freakout and MarketOne, as well as clients. These local players have a strong presence in the market and also own SSPs [supply side platforms], so we will have to cooperate with them in one sense or another."

Then there are Japan's two advertising giants, Dentsu and Hakuhodo, both with offerings in the DSP and programmatic space. In the case of Dentsu, its digital marketing arm CCI partnered with American-adtech firm Rocketfuel in 2012, and the ad giant launched its own trading desk in 2013. 

Nevertheless, Yokota is confident that digital advertising in Japan, unlike offline advertising, is still a relatively open market. "MediaMath's advantage is its different approach," he said. "It has unique technology and focuses on client's results and goals. This coupled with global expertise and transparency sets it apart in the marketplace."