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ShareThere are certain ideas which are disruptive, yet simple. They typically take a lot of time to grow into commercially viable and alive ecosystems. One such idea is the Last Minute Inventory (LMI), an online media trading exchange. Though the thought process was on for nearly two years, the idea(some call it a revolution) finally saw the light of the day in April this year. It took off amidst fears of advertising rate information getting leaked and apprehensions about the roles of intermediaries (or lack of it) and downward pressure on advertising rates, among others. But, going by the business generated by the online exchange in September, all such fears have been put to rest for the time being.
Sandeep Goyal, chairman, Last Minute Media Pvt Ltd, shared with DNA Money's Anoop Chugh details about the portal, whose inventory draws from over 80 media owners including Zee Network, The Times of India Group, Hindustan Times, India Today Group and Discovery.
LMI was conceptualised in 2007 and went live in early 2009 (with transactions starting from April 2009). In September this year, LMI saw a business of $2 million. Are you satisfied with the numbers?
I am very happy. It has taken a lot of effort and hard work. Evangelising a new idea is not easy, and seeing it succeed makes you happy. We are looking at a much bigger market emerging over the next 12-18 months. In any new enterprise, especially, something as path breaking as LMI, the initial period of business development is long.
For us, at this stage the quantum of transaction/value is of less importance. The successful implementation and acceptance of the portal and the concept is the mission-critical. And we seem to have got that right.
There were similar (not so successful) attempts by Madison Media (Adnova) and Exchange4media.com in the same space. What will make LMI click?
We are not fully aware of how they approached the business, hence I cannot comment on that. As far as we are concerned, we have developed a unique proposition, wherein we create value for all the constituents of the ecosystem, which makes the product attractive to all. Besides, we are adding many more new concepts on the portal, which will enhance the value of the portal for all parts of the ecosystem.We believe, our offering is unique, clients have tested this and have found it to be delivering value, and that's what will make it click. We are an operational portal, a live transactional portal with visible traction, not just a concept.
Industry experts also fear these ventures failed to take off because clients were worried about information on such ad rates ending up with rivals. How have you ensured confidentiality of the rates?
We have built in very stringent security systems into the portal. Each client and media house has a unique password and a login id, which is fully encrypted. The password strength is benchmarked to international best practices, utilising the complete ASCII character range of 128 characters -- which means it is fully protected from brute force attacks (i.e. an account cannot be broken into easily). All client-media dialogues are through secured path, which cannot be accessed by anyone else.
All data, post log in, is encrypted using Verisign SSL (secure server login), which is the leading encryption service for financial transactions. That means we ensure that the data transactions in our system is as secure as financial information stored by banks/credit cards etc. It means, just like in banking services, in our portal too, no one from outside can view the data/or hack into the database. In fact, our information security protocol adheres to the guidelines of ISO/IEC 27002 standards.
There were fears that LMI might dis-intermediate media experts out of the buying-selling process in the long term, especially if advertisers are ultimately allowed to deal directly with the Dentsu portal online and save media commissions otherwise payable to the media buyer. How have you addressed this issue?
The value that media experts bring into the entire media planning and buying process is much more than just getting last-minute value deals. Thus, we are unlikely to usurp their role in near future or even in the long-term perspective. Yes, we will definitely add value to their service offering.
So, is it a win-win for advertisers, media and media planners?
It's a win-win for all. The media gets an additional channel to offer its inventory to buyers at a short notice, reaching out to geographically diverse and a spread-out market. Any of these can be the potential buyer of the offered inventory, and in a short span, it's impossible to reach out to all, in a cost-effective manner. The advertiser gets one-stop solution wherein he can look for spot deals (maybe just for 10% of the ad budget) where he can get value deals (not only cost-effective), which helps in improving the media ROI (return on investment). Besides, the portal will offer many unique communication options to the advertiser, which may not be on the immediate radar of the advertiser, but can be very, very relevant. He/she can explore them, have dialogue with the media owner efficiently, and close deals if found attractive.
From the price perspective, wouldn't LMI put a downward pressure on advertisement rates?
The media houses will offer only limited inventory -- the stuff which remains unsold till the last moment. A client is unlikely to have his entire buying strategy based on such limited inventory where one can't fully guarantee availability as per need. Therefore, the normal buys will continue to take place at regular rates. The top-up inventory buying will happen through LMI at an attractive rate -- the quantum of such buys can be 5-10%, depending on the client strategy. Once seen from this perspective, one shouldn't fear about any downward pressure on rates.
