As someone who as long managed campaign delivery for publishers, it has always irked me that in the IAB’s standard terms and conditions, publishers and advertisers ignore any discrepancy under 10%. Once the discrepancy climbs higher, the advertiser’s ad server acts as the metric of record, which puts the publisher at a disadvantage. These terms and conditions are about 15 years old, as long as I’ve been in digital advertising.
The discrepancy burden on publishers is so ingrained in the system that in a recent study, the IAB actually put a positive spin on what would normally be seen as a terrible finding:
“However, on the brighter side, more parties are becoming aware of this [discrepancy] issue and working together to find sustainable solutions. For example, in this year’s survey 53.7% of respondents reported that agencies were willing to help troubleshoot issues with discrepancies.”
In a situation where agencies help solve discrepancies only half the time with no repercussions, publishers are often left with a difficult choice; provide a make good without reconciliation or risk being dropped from the next media plan. In mobile, where average discrepancies are between 10% and 20%, that’s a huge tax that publishers must factor in.
Over time, I have seen the tax on publishers multiply significantly. EMarketer reports that CPMs have hovered between $10 and $11 since at least 2012. Yet as many others have noted, the increasing number of middleware technologies taking a cut of that CPM leaves publishers with less every passing year.
Viewability: Taxation Without Representation?
Viewability threatens to be the straw that breaks the publisher’s back. It makes sense that advertisers would embrace viewability – it’s a metric that shines a light on the dark corners of digital inventory. Yet, leaders like Augustine Fou argue that buyers are putting undue pressure particularly on premium publishers when it comes to viewability.
The 4A’s as well as many brands and agencies have latched onto viewability as a problem that inventory providers need to solve, but have failed to define exactly what it should mean or how it should be measured. Many buyers have argued for stringent viewability standards of 100%. Publishers have largely started to shift their offerings to accommodate 100% viewability campaigns and premium publishers have increased CPMs to account for the more stringent standards, but the problem of viewability is still not solved.
The Make-Good Problem
For publishers, there are still two issues with managing viewability. First is an added “tax” of managing multiple vendors, creating new reports and projecting the right delivery schedule. The second is the problem with make-goods. The already ingrained practice of make-goods creates a perfect opening for how agencies deal with viewability discrepancies. Instead of creating an objective auditing standard, many buyers blame the chain of vendors for using the “wrong” metrics and demand more make-goods.
Thus, the ecosystem continues to operate in a way that pushes the problem downhill. In fact, AdYapper, a fraud and viewability vendor, aligned itself completely with brands after they saw first hand how loath agencies were to actually try to reallocate advertiser dollars effectively or work with publishers to understand the issues, relying instead on the make-good process. AdYapper has argued that make-goods for discrepancies and viewability are terrible for advertisers, even if agencies don’t give them much thought.
Change Incentives, Change The Ecosystem
With the right incentives, advertisers could persuade agencies to minimize make goods, which would certainly increase their collaboration with publishers. Additionally, advertisers and publishers should push for viewability and discrepancy metrics that are truly separate and objective. Relying on vendors who have lucrative deals with agency trading desks, ones which profit from volume, is the worst possible scenario, and it needs to change. Finally, it is time that advertisers work with publishers, not against them. Both entities have always and will always need to exist in the advertising ecosystem, while the ad tech vendors and agencies that feed of them do not. When advertisers and publishers are willing to provide transparency to one another, many of the problems that actually fund ad-tech can go back into working media.