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Criteo's India MD on competing with Google and Facebook, focus areas and more
![Criteo's India MD on competing with Google and Facebook, focus areas and more](https://assets.techcircle.in/uploads/article-image/2019/03/images/18046-siddharth-dabhade-gm-criteo-india.jpg)
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French advertisement-technology company Criteo is among the few companies that have been able to take on the might of Google and Facebook. Among its Indian competitors are InMobi and Vserv.mobi. Started in 2005, Criteo floated an initial public offering in 2013 and delivered consistent revenue growth over the following years.
However, the European Union's General Data Protection Rules (GDPR), which came into effect in 2018, affected the company as concerns arose over its data collection practices. For 2018, the company's revenue was little changed at $2.3 billion. It is projecting a recovery this year, though, and has a strong list of clients such as Walmart and Alibaba.
Siddharth Dabhade, Criteo’s India managing director, spoke with TechCircle on the increasing role of the company’s local office and what differentiates it from the competitors. Edited excerpts:
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Could you tell us about the company's India operations?
We have an ad operations centre that support all the countries in Asia Pacific from India. It is a fairly large operation. We are looking at adding more ad operations for other regions from India as well. We will become the global hub for ad operations.
In the future, we plan to grow our tech team here as well. Mobile is big in India and hence we had a large team in India and now we are looking at growing that team. Tata Cliq, Shopclues, Yatra, Flipkart, Paytm and Nykaa are among the Indian customers. India is the fastest-growing country in Asia Pacific for us. India [revenue] grew 65% [in 2018].
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How does an ad operations centre help you personalise ads?
We have advertisers on one side and publishers on the other. We have inventory on one side and our customer’s budget on the other. While the data are anonymous, we know that this is a customer who went from Flipkart to a news website or a product review website. So we know he is interested in that. We show relevant ads and, in that process, make recommendations that we discussed before or offer personalisation.
The ads different customers see are different. This requires some manual intervention at times [which the ad operations centre does]. Some of it is automated, but to release that campaign we still need manual intervention. Brands have templates for banner ads and we seek their approval before releasing the campaign.
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Do you focus on certain sectors where you have an advantage over competitors?
We focus on retail, travel and classifieds across the globe. Walmart in the US and Alibaba in Asia Pacific are among our clients.
Technically, e-commerce is part of the retail vertical. We work with the e-commerce arm of offline retailers in India like Arvind Group or Aditya Birla. We are expanding into areas like pharmaceuticals, education, media and banking, financial services and insurance. These are the verticals we are interested in as of now.
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In India, we are strong in the travel segment. We work with MakeMyTrip and Cleartrip, while Booking.com is one of the largest customers globally for us. In classifieds, we work with 99acres.com and Housing.com among others.
Is e-commerce your largest segment in India and how do you differentiate?
Yes, it is one of our largest verticals in India. Our core strength is retargeting and that is very relevant in the Indian market now. If you look at e-commerce, which is more than a decade-old industry, it was good to add new customers earlier while now you also have to create a loyal customer base. Retargeting plays an important role there.
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We have certain differentiators and we are the leaders in this space for recommendation, multi-device targeting or personalisation.
For example, this is how our recommendation engine works. If a customer was trying to buy a pair of shoes on a website and did not check out but went to some third-party website, we can show you the ad for the same product on the same website the customer was looking at earlier. It could be best-selling shoes or some other relevant shoes in that category.
Around 28% of products sold were ones that customers had not seen earlier. So we can upsell new products for our advertisers. E-commerce is among the largest revenue generating industry for us. In Asia-Pacific, around 25-30% comes from e-commerce.
You recently opened an artificial intelligence lab in Paris. What is the role of AI in what what you do?
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Our entire technology is based on analytics. We take into consideration almost $700 billion worth of e-commerce transactions. We keep adding categories. We keep investing in our algorithm and [offer] the right recommendation and personalisation across multiple devices.
The input from the analytics team goes into the AI and machine learning algorithms for enabling these features including video ads. We take encrypted email IDs from advertisers and find the devices linked to the same email addresses, and thus create a shopper graph.
Since this is all anonymous, there is no privacy concern. Being a European company listed on the Nasdaq, we are compliant with the GDPR and US rules.
We have more data on e-commerce than Amazon. We get data on multiple devices, browsers, categories, apps etc. We understand consumer behaviour based on such data, which is dynamic. Then we improve the algorithm using the vast data. Globally, we have a 700-member analytics team.
The top players in the industry like Google, Facebook, Apple and Amazon are increasingly getting bigger. What are your challenges?
That is actually an opportunity because publishers are not getting their due share. We are helping them get more value for their inventory. They (Google, Facebook) are effective, too, and that is why they are able to do it. But our algorithm is focussed on publishers and open internet. Their (publishers') dependency on a few players goes down.
For us, the biggest challenge is to ensure customer privacy while being transparent on how their data is being used. How do we make the most of creativity while increasingly using automation and AI at scale?
Google has search intent, Facebook has social intent, Amazon and Alibaba have the purchase intent. The role of e-commerce players is getting bigger in the advertising space because purchase-intent is stronger. The industry dynamic itself is changing.
India’s first unicorn was in this segment (InMobi) and was also founded around the same time as Criteo. There were several other players, too. What did they do wrong?
You need to have a minimum viable scale in the sector. If you are restricted to a few geographies, it becomes difficult. There are not many other large players even today. If you can't play at scale, you are not able to invest in the algorithm.
We expanded in Europe fast and in the second year of operations itself, we went to the US market and Japan soon after. Good presence in such lucrative markets helped the company to continuously invest in the algorithm, helped Criteo to scale. Another important factor is how differentiated is your product.