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AudienceScience on the challenges and merits of launching an ad tech business in China

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By Charlotte McEleny | Asia Editor

August 18, 2016 | 4 min read

AudienceScience has today announced the opening of its China operations, as it opens the doors officially to its new office in Shanghai.

AudienceScience China

AudienceScience launches in China

According to AudienceScience, it’s the the first and only western-based, fully integrated data management and programmatic buying platform operating in mainland China. It will have locations in Shanghai, Beijing and Guangzhou.

This claim is likely to be hotly contested as many western ad tech businesses are starting to become operationally on the mainland, after long periods of planning.

Richard Huo, VP of the AudienceScience China business, spoke to The Drum ahead of the announcement about the journey the business has taken to become operational in the country.

According to Huo, the Chinese programmatic market is either about to or already has surpassed markets like the US in terms of mobile video consumption, making it a very appealing market for an established Western business to launch in.

However, he said that it’s been a tough country to set up shop; “The market is very tight-knit and almost all companies in the programmatic space are local to China, and many of them are either owned by or have partnered with the largest media companies in the country. So being a US-based company has been challenging in finding the right partners and learning the local laws, customs and practices. And many laws that would make it easy to work in APAC or Europe (like a data Safe Harbor provision) do not apply in China. Fortunately we have amazing clients and partners helping us and have built a local team (primarily in Beijing and Shanghai) with extensive local experience that have helped us establish the right relationships and progress.”

In terms of partnering, Huo says getting the platforms and exchange partnerships in place was critical for launch. He says it would have been “virtually impossible to succeed in China without local partners” both for inventory and data. He plans to grow to over 20-30 inventory and data partners over the next year.

While AudienceScience is putting its flag in the ground from a Western platform point of view, Huo does acknowledge that the race is on for the rest of the competition.

“Due to the opportunity that the China market represents, almost every Western ad technology company is trying to make inroads in China. Most of these foreign competitors are either based in Hong Kong or somewhere else in APAC, which means they do not have the local presence and expertise and relationships we have. As a result we can say that we are not directly competing with any foreign competitors that are physically based in China,” he says.

However, the domestic competition is strong, particularly in people that excel in their part of the ecosystem; as publishers, ad networks or platforms. However, Huo remains optimistic that AudienceScience can offer “breadth” as a differentiator.

“China is clearly one of the critical global markets for advertising and technology, and as a result we see China being in the top two-three largest markets for AudienceScience in the world. We are committed to success in China as a core part of the global AudienceScience platform,” he says.

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