Demand for SPO has picked up with a spike in digital adoption: Mukul Kumar, PubMatic

Supply Path Optimization (SPO) is a major focus area for programmatic marketers these days as they simplify the supply chain between advertisers and publishers by removing undesired intermediaries and redundancies. 

In the Header bidding of programmatic, which allows publishers to simultaneously offer ad space to multiple supply-side platforms (SSP) or ad exchanges at once leading to a situation where many ad exchanges end up selling the same inventory. In some cases, the marketers receive up to 20 or more bid requests for the exact same ad impression. This confuses buyers about how to pick the best exchange to buy through.

“Buyers are constantly looking to optimize their ad spends. Supply Path Optimization (SPO) reduces auction duplication and offers premium ad inventory helping both publishers and buyers to improve ROI,” says PubMatic's Co-founder and President, Engineering, Mukul Kumar. PubMatic, an ad-tech company, is considered a pioneer in the SPO that seeks to ensure media transparency by offering ways to get premium ad inventory.

Kumar says, “We had developed the SPO solution a few years ago. Its demand picked up during the covid-19 pandemic as the adoption of digital accelerated. We leverage our massive data asset and sophisticated machine learning algorithms to increase publisher revenue and advertiser return on investment (ROI).”

“Our SPO partners grew 44% between 2020 and 2021. Moreover, our omnichannel approach enables us to serve our buyers with more than 300 billion ad impressions a day,” says Kumar.  

The company is known for its suite of solutions like OpenWrap, real-time bidding (RTB) technologies, private marketplaces, and ad quality that are meant for publishers. For buyers, it offers inventory quality, media buyers console and private marketplaces apart from customized solutions. 

PubMatic, which has its genesis in Pune, has made it big globally, particularly in the US market. Co-founded by Rajeev Goel, Amar Goel, Anand Das, and Mukul Kumar, it went public by listing on Nasdaq Global Market in 2020. 

“At the time of IPO, our market share in the ad-tech industry was 2-3 %. Now, it's 3-4%, which is significant. We have seen 54% growth in the entire financial year 2020,” says Kumar, adding that PubMatic's omnichannel solutions help buyers to scale up impressions for all formats including CTV, mobile, and OTT platforms providing high ROI. 

SPO will go up further as more and more buyers want to consolidate supply paths for advanced targeting solutions and best ad inventory, believes Kumar. 

About the upcoming Pune Engineering hub

"I love talking about the Pune engineering hub that is coming up in the Aundh area, next to Western Mall. The 14-floor building has the capacity to house 800 employees in a hybrid setup, says Kumar. It will be an iconic, environment-friendly, and colorful hub with a large terrace consisting of gardens and chairs where employees can relax, work, meet or hold sessions. Inside, there will be 12 meeting lounges, high-quality office spaces, seats, and high seats", Kumar said.

"We will use solar panels to meet some of our energy requirements. For sustainability, we have separated out sections so that AC can be turned off when not needed. “The building will be connected to the Western mall. Employees can walk down there, watch movies, have food, and shop. Our people who have been working from home are really excited to come back to the office now which feels good,” chuckles Kumar. 

Ad frauds

Referring to the concerns like digital ad fraud prevailing in the industry, Kumar says his tools ensure a fraud-free environment for buyers. “We have different tools that enable programmatic fraud-free solutions, efficiency, and privacy. We ensure that there is no fraud, at any given point of time. If it occurs, action is taken against it. Third-party tools can easily tell us if this is a fraudulent inventory.”

Our growth rate has been tremendous due to the infrastructure model and user-based software model, says Kumar, adding that many of his products are the ideas generated at Hackathon organized by the company.  

Cookieless world

Audience addressability is a long-term strategy of PubMatic to prepare the programmatic system for the cookieless world where contextual marketing will rule, says Kumar. A bunch of third-party data owners and contextual partners are currently working with PubMatic to scale up contextual solutions. 

Identity Hub is their umbrella IT solution that helps to manage, integrate and configure the consumers' data. “Adoption of Identity Hub has also gained momentum in the past 12-18 months as more and more media buyers are preparing themselves for the cookieless world when targeted marketing will not be available,” Kumar says. 

PubMatic is working with San Francisco-based IT company LiveRamp which uses authenticated traffic solutions that double the CPM for publishers and triple the fill rate in Safari and Firefox, says Kumar. Our solution 'Audience Encore' allows us to operate in a privacy-safe environment. First-party data owners can scale up their data in billions of impressions in a privacy setting. 

Expansion Plan

We have decided to reinvest our 2021 profits in developing infrastructure for the company at Pune. We will double the headcount in the next 12-15 months, build the office and hire engineers for future technology, enhancement on media buyers' consoles, new video formats, enhance contextual and first party data, machine learning, and data processing.

Also, India has surpassed the US in OTT subscriptions. Compared to 235.3 million OTT subscribers in India in 2020, the US had 220 million, Kumar says. “India’s OTT market is growing by 8.8 % annual growth rate compared to 2.3% in the US. With OTT players such as Zee5, Voot, Sportskeeda as our partners, we are innovating and finding more ways to do header bidding,” he added. 

Kumar explains that buyers want to work with fewer high-quality omnichannel Supply-Side Platforms (SSPs) such as PubMatic. “By omnichannel I mean, working with multiple channels in a very seamless fashion. We provide our reporting and controls in a very seamless way across different types of media such as display, mobile, OTT, and video.”