JEFF GREEN: This topic is interesting, as it relates to the P&G announcement and our success in Q1. There’s a trend that often gets described as brands insourcing and taking over media themselves, and I don’t think that’s typically true.
What’s happening is brands are recognizing they want a closer relationship with technology partners, but they still want agencies to manage those. We are getting closer to brands, but only through their agencies, and in all cases, we’re suggesting the brand leverage the breadth and scale of the agency.
How do those new multi-stakeholder relationships tend to come about?
They can arrive in all forms. We get inbounds from brands sometimes and then we bring in the agency. Or the agency comes to us because of what we can add to their pitch. Sometimes the brand definitely goes to the agency and says, “We want to talk to them.”
We’re benefiting now from the trust we’ve developed with agencies over years. It’s mostly within the ad tech community where people say, “Oh, wow, you’re working directly with the brand,” and then we have to clarify.
We try not to get caught up in just the noise that too often exists in the ad tech community.
There are a lot of industry initiatives that are worthy of support. I’m super intrigued by that consortium, for instance. I think it’s a very interesting prospect. So, we’re certainly in those kinds of discussions, but we’re not afraid to be different and it as an advantage that there’s a degree of independence.
In a previous call you discussed The Trade Desk’s take rate, which has been a hot-button topic for public ad tech companies. Are those margins changing?
We’ve told the street and shareholders that our margins will be between 15% and 20%. We don’t expect that to change for as far as we can see into the future.
We disclose our take rate and gross revenue figures annually, but not on a quarterly basis. We don’t want to alarm investors or clients, because it does bounce around quite a bit based on who we’re working with, the quarter or the geography. In Q1, for example, we typically have a higher take rate because we offer better discounts –lower margins for ourselves – on quantity, and the biggest buys come later in the year.