Commentary

MRC Audits Of Facebook And Google: What's At Stake?

With Facebook and Google agreeing to undergo audits in order to get accredited by the Media Rating Council (MRC), it’s clear that third-party audience measurement of digital media has shifted into high gear.

In recent weeks, Google said it would agree to a third-party audit for YouTube -- and Facebook, after some measurement missteps, decided to be audited as well. Perhaps Procter & Gamble chief brand officer Marc Pritchard’s public comments in January helped hasten the process. Pritchard is also chairman of the Association of National Advertisers (ANA).

In any case, RTBlogchecked in with George Ivie, CEO and executive director of the MRC, to learn about the auditing process and what’s at stake.

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RTBlog: How did this issue get to such a fever pitch?

George Ivie: A couple of years ago, the ANA published a white paper that essentially asked the platforms to be more transparent. That generated activity. Google and Facebook had already been talking about auditing.

Earlier this year, Facebook disclosed an issue with its video duration metrics. Facebook placed all seconds of the video ad view in the numerator, and only views that were three seconds or longer were in the denominator. That inflated the average view time and made it look like people were spending more time with Facebook videos than they really were.

That disclosure caught a lot of attention and lit a new fire. The ANA stepped forward again and asked for an audit. We’ve been working with Facebook informally for quite some time.

We’ve also worked with Google on accrediting its ad-serving products. Its ActiveView viewability product is accredited. Google came to the realization that it wanted to expand the audit to metrics on YouTube. The question is, how do you do it? It entails some of YouTube’s internal metrics and the data it provides to third-party measurers.

The main thing is, the marketplace wants the metrics to be validated via third-party measurement providers we typically use—companies like  Moat, Integral Ad Science, DoubleVerify, Nielsen, etc.

RTBlog: What makes measurement more challenging with large platforms?

Ivie: What these large digital enterprise have in common is, they don’t allow the application of tags to their sites or their apps. For example,  small publishers are tagged directly by measurement organizations that they work with like Moat, etc. The organizations apply their tags, and measurement occurs.

If you’re a Google or Facebook, you have a lot of companies wanting to tag your site. If you have, for example, 15 measurement tags on the site, it would take a long time to load the home page. Latency is a huge issue.

Platforms like Google and Facebook prohibit tags on their sites, so measurement vendors like Moat won’t get the signaling data from their tag. So they rely on Google and Facebook to communicate what’s happening on their pages. How many pixels are in view? Is the ad viewable? And so forth.

So they communicate through a stream of data via a third party, instead of it originating with a tag that the vendor controls.

RTBlog: So what’s the goal of the audit?

Ivie: We have to audit the originating data. Is it accurate? And how do we do it? Right now, we’re looking at how to audit YouTube, and what does the audit cover? For example, Google could decide to constrain the data it sends to the vendors, but that would be bad. We want to understand what the communications path is.

For example, Moat might have 50 metrics it reports on, but a key metric is viewability and the length of time an ad appears. We have to make sure that the data that’s transferred from Google has enough signaling information to report on the metrics.

RTBlog: What metrics are most important to these companies?

Ivie: I would say viewable impressions is what they’re looking to have validated. For YouTube, it’s video ad impressions that are served and viewable, and duration metrics—those are the most important ones.  Facebook has a news feed interface and that drives metrics differently, so there might be different metrics that it chooses to submit.

RTBlog: What is the audit process like?

Ivie: Our audit process is voluntary. Companies can choose what metrics to submit and what not to submit. Advertisers that are MRC members, like P&G, can look at the audit reports. They can see what metrics are accredited or not. My impression is that Google and Facebook will go with the metrics that we suggest and the ones the marketplace wants.

Our 157 members form into audit committees based on products they have an interest in. We audit over 100 products annually. The members get audit reports and help us make accreditation decisions.  It’s a very difficult process; it’s not easy to be accredited.

RTBlog: Who pays for the costs of an audit?

Ivie: We use certified public accountants (CPAs). Google and Facebook pay the MRC for the audit costs, which is the cost of the CPAs we hire. And then we pay the CPAs. In this process, the MRC is the client.  A pre-audit and an audit can run into the six figures. We use Deloitte and Ernst & Young. The MRC doesn’t charge for an audit; we are funded by our  membership dues. 

RTBlog: Are there other independent third parties that conduct audits?

Ivie: There are other entities. The Alliance for Audited Media (AAM) and BPA Worldwide do independent audits, but they don’t do what we do. We call our process accreditation. We use independent CPAs to conduct an audit and provide oversight of the process. Then we take the CPAs’ opinions to our members and they render a decision. It’s a unique process.

RTBlog: What should the industry take away from this?

Ivie: You hear a lot of people talking about large digital enterprises and a lack of transparency. Here you have two of the biggest ones that have agreed to be audited. We write digital audience currency standards all the time; you don’t have to be a member of MRC to participate in that process. Anyone can join the process of how standards are set. Right now is a good moment to participate in the process, as well as become a member of the MRC.

It’s great that the ANA has taken a leadership position here.

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