Supply chain complexity, a varied understanding across metrics that measure ROI, brand safety, and, in particular, transparency are some of the pressing issues that hinder brands and marketers from executing their digital advertising strategies and achieving the desired business outcomes. Thankfully, steps are being taken in the programmatic industry which aim to address those issues.
The growth in content consumption in social media, video streaming platforms, and mobile apps has encouraged brands and advertisers to shift their attention to digital media. While this shift opens opportunities in digital advertising, the growth in the adoption of digital ads also brings a host of challenges.
In response to advertisers clamoring for clarity over inventory cost and brand safety, programmatic has been looking at the potential for improving digital ad and media effectiveness using cutting edge data technologies. By leveraging, artificial intelligence (AI) and machine learning (ML) technologies, advertisers are able to achieve cross-device targeting, audience reach unification, 360-degree measurement, and other advanced marketing strategies. With the emergence of AI and ML technologies in the programmatic space, digital media advertising is getting the boost it needs to address supply chain transparency issues and adapt to growing market demands.
Transparency: the path to optimizing resources
Lack of transparency has been a part of the ecosystem since the dawn of digital media advertising. Fraudsters and bad actors have found a way to exploit this flaw, which bleeds the industry dry. As programmatic advertising expands, there is an opportunity to address transparency issues with the use of advanced digital media measurement tools. While ad verification tools and platforms are available to ensure that advertisers get quality, brand-safe, and suitable inventory, advertisers still unknowingly abdicate their control over digital campaigns to intermediary companies in the supply chain.
Due to a lack of understanding of the available measurement tools and techniques, advertisers end up wasting marketing resources. Supply path optimization (SPO) is now becoming common practice when buying digital media inventory. The technique works by deliberately choosing a specific supply-side platform (SSP) or ad exchange to procure inventory. Advertisers will then deal directly with the publisher or broadcaster through a private marketplace (PMP) and clear the transaction through the publisher’s SSP seat. Using this technique brings more control over domain transparency for programmatic buyers.
How the industry deals with transparency issues
Transparency issues are discussed within the industry around the need to stop ad fraud. Ad fraud impacts advertisers in two ways – cost and ad quality. Without visibility on ad spend, buyers end up paying more for the inventory than what it is really worth. Similarly, the lack of transparency makes it easy for fraudulent media buyers to sneak into the supply chain and fabricate impressions.
The latest report from the Association of National Advertisers (ANA) states that one-third of advertisers have made updates with media agency contracts in the past year due to transparency concerns in media buying. Sixty-nine percent of the respondents also share they have updated their contracts in the past three years as part of their efforts to clear up murky billing practices.
To address fraud and transparency issues, the Internet Advertising Bureau (IAB) introduced ‘ads.txt’. The solution works by placing an ads.txt file on the publisher’s domain that includes a list of authorized resellers of their inventory. Sellers need to do the same by showing publishers the list of authorized inventory for sale. For applications-based environments,
IAB announced the app-ads.txt, which provides transparency for the mobile and OTT programmatic advertising ecosystem. Ads.txt and app-ads.txt help eliminate the unauthorized resale of inventory, flag domain spoofing, and other dark and deceptive fraudulent practices. Ad fraud is a billion-dollar problem that the industry has been trying to solve. These steps create transparency in the supply path and allow advertisers, publishers and ad tech providers the ability to optimize ad spend and reap the maximum ROI.
The Future of Programmatic
To prepare for the future, players in the media advertising world are looking for ways to use the latest technology to uphold the integrity of transactional data and strengthen the transparency model for digital marketers. One of the tools being considered is a cryptocurrency, a digital currency built on blockchain technology.
The technology has a strong potential to decentralize the digital media ecosystem. To introduce a consensus on verification and audit, multiple brands have already started to build workflows, using blockchain technology to eliminate fraud and drive advanced log level analytics.
The use of programmatic ads to achieve efficiency, maximize campaign success, and avoid ineffective inventory will continue to grow. With the help of AI and ML technologies, programmatic ads are creating an environment that enables advertisers to reach the right audiences and deliver the best business results.
Authored by Dimpy Yadav, Head of Client Engagement, Xaxis India.