• by Laurie Sullivan , Yesterday

Transparency in media-buying auctions based on technologies that few understand has become one of the most sought-after fundamentals for the advertising industry.

While the Media Rating Council (MRC) focuses on measuring the delivery of ad impressions -- not how auctions work -- Ben Hovaness, chief media officer at OMD Worldwide, an Omnicom agency, convinced Ron Pinelli, senior vice president of digital research and standards at the MRC, that executives should at least know the “rules” of any specific auction.

Beyond the rules for setting the price of the ad impression, Hovaness also wanted more information on how actions determine what an advertiser wins, as well as how the system works -- at least on a high level.

Other factors are considered, Pinelli said, such as whether the company scores the brand’s creative based on the likelihood of success or report on other projections to thoroughly report on the auction process.

“The proposed framework seemed more about transparency and disclosure and not about dictating practices,” Pinelli said. “In the middle of 2024, we polled our members asking if this is something we should devote our time to, and they overwhelmingly said 'yes'."

Discussions around the framework surfaced because every day there is a new closed-loop ad auction, Pinelli said, and all retail media networks and connected television (CTV) providers have their own ad auction now.

The framework suggests companies should have someone to spearhead general guidance and governance for closed-loop or programmatic auctions that monitor quality and changes, including guidelines on available inventory and creative.

Transparency around OpenRTB specifications for the open web is being considered. Not many programmatic supply-side platforms (SSPs) and demand-side platforms (DSPs) use certain optional specifications that could provide additional insight, Pinelli said.

“If they did it could really help with transparency like the transaction and global placement IDs, as well as the use of multibid, where DSP review all the bids, not just the highest,” Pinelli said. “It would mean taking the RTB bid and making it reportable and useable for the users.”

Closed-loop disclosure requirements would mean providing insight on how the auctioneer determines the price of the impression and the winner of the ad auction, which has been a source of contention in Google’s monopoly trials.

“There might be guaranteed deals that circumvent the pricing,” Pinelli said. “What ever the rules are, just be transparent about them. The MRC does not want to set them. And, if you do any scoring on creative, just report on it.”

Changes in scoring and algorithms also should be reported. The framework is meant to inform those using the auctions.

MRC will run this as a voluntary audit. Some will find it easier to comply than others. Pinelli said he did get pushed back by some companies based on the auction’s complexity.

“To those folks I said isn’t that the point,” he said, declining to disclose those participating in the framework. “If it’s too difficult to explain, maybe you should challenge it.”