In another indicator of the impact that weakening economics has had on the ad industry, payments to the media have grown increasingly late over the past two years, according to new data released by online ad-revenue exchange OAREX.
The data, which tracks digital media payments made both manually -- directly by ad agencies or clients -- as well as programmatically via ad tech middlemen, shows all forms of media-buying payments have been slowing down for digital media, but especially for manual ones.
While the percentage of late payments have grown to more than 40% of all digital ad buys tracked by OAREX in its report, the delta between manual and programmatic ones spread significantly, indicating that programmatic buys are indeed a more efficient system for paying the media during times of volatility.
The gap between manual payments -- those processed manually be ad agencies or clients directly themselves -- and programmatic ones processed by programmatic middlemen peaked at 13 points in June 2021, but has hovered between 8 points and 10 points through the end of 2022, according to the report.
Other factors may be at play in the trend, including the belief of many advertisers and agencies that more of their ad budgets go into "working media" when they buy manually vs. the "ad tech taxes" they pay when they utilize programmatic middlemen, but there's also a bottom line impact for their suppliers, which are seeing slower payments.
In fact, while only 3% of programmatic payments were more than 15 days late, according to the report's year-end 2022 data, 26% of manual buys were.
While the report does not delineate the late payments by specific agencies or clients, it does provide a breakout of major exchanges, DSPs and SSPs tracked by OAREX.
The data shows a wide range by programmatic payor, from 0% to 100% late (see below).