The Trade Desk has named its first general manager for China in Calvin Chan as the publicly listed ad-tech company bids to further placate investor demand for growth, with its market cap hovering above $10 billion.
The appointment represents The Trade Desk’s intention to accelerate its presence in China after the announcement of its official launch there earlier this year as programmatic spend in the world’s second-largest economy nears $30 billion in 2019.
Chan joins from AdMaster—a China-based ad-tech company—operating out of Shanghai (this is in addition to The Trade Desk’s existing Hong Kong operations) and reports to the demand-side platform’s svp for North Asia Troy Yang.
Speaking with Adweek, Chan declined to comment on the company’s existing headcount on the Chinese mainland, although he did claim The Trade Desk intends to double its headcount there by the close of 2019 with an emphasis on hiring business development and sales staff as well as media traders.
“Earlier this year, The Trade Desk pioneered a new China strategy that helps global advertisers access the world’s largest emerging middle class, and Calvin’s appointment will help accelerate our growth with major Chinese partners and advertisers,” said Yang.
“Calvin brings considerable expertise and experience to The Trade Desk but also a well-established network that is critical to success in China.”
“The Trade Desk has developed a unique solution for the China market that helps global companies tap into local demand and helps Chinese companies grow internationally,” added Chan.
International players need to ‘add value,’ not ‘compete’
Speaking with Adweek, Chan also discussed the localization necessary for international companies to make a success of a Chinese launch, a challenge that has presented some of the industry’s largest names with difficulties in the past. This includes providing assurances that new market entrants bring net-new value to the market and are not competing for existing spend with established players.
“The Trade Desk has been positioning itself as an independent, objective and transparent programmatic partner across the globe, and this is exactly what is needed in China,” he said.
“I’ve lived and worked here for 14 years and, in my opinion, I don’t think there’s a comparable venture here … you also have to think about the local network and ecosystem partners.”
This includes furthering relations with local internet giants such as e-commerce giant Alibaba, search engine Baidu and Tencent—a conglomerate with interests in online gaming, messaging app WeChat plus online video.
In addition, Chan’s team will adapt The Trade Desk’s global “agency-first” approach to the nuances of China, which will necessitate outreach to local media buyers such as BlueFocus as well as making inroads to the international holding groups’ operations there.
“What we are also doing right now is engaging with the local industry associations such as the China Ad Association, which is like the IAB plus MRC and ANA … we’ve applied for membership of the CAA and are already involved with some of their committees,” explained Chan.
Adapting to local data laws
During its quarterly earnings calls, The Trade Desk’s leadership frequently highlights its efforts to further international expansion with China, often raised in such conversations with the company’s CEO Jeff Green, who was based out of Hong Kong for the majority of 2018.
Also speaking with Adweek, The Trade Desk’s CRO, Jonathan Carson, emphasized the need for the DSP to build further relationships with local inventory suppliers as well as gain a better understanding of the technical complexities of the local market.
“In most markets, the inventory sits with a lot of the global players … in any market, there are always local powers, but in China, those local powers are a much bigger percentage of the market,” he explained.
This localization also required a sizable investment in adapting The Trade Desk’s platform to comply with the intricacies of local data laws, especially as its business model will (initially) center upon helping global businesses tap into local demand.
“All of this makes for quite a complex environment to do business … the focus thus far has been to build relationships with key players … you have to establish trust and show them how you can add value as well as have an understanding of the technological complexities,” added Carson.
The Trade Desk made its most recent quarterly earnings filing earlier this month with the DSP reporting revenues of $159.9 million and its market cap subsequently remaining above $10 billion since then. This is compared to 12 months prior when its valuation circled the $5 billion mark with some questioning whether or not it could continue.
However, since then it has continued to bolster its revenue numbers; its latest filing showed income was up 42% year over year, as it rolled out a number of initiatives such as its Unified ID solution, which it has positioned as an alternative to the industry’s walled gardens of Facebook and Google.