Interview with Judy Shapiro with Business Impact Leadership Series
Conversations about trust and transparency in ad tech are vexing because complexity in the ad tech supply chain makes accountability excruciatingly tough.
Within this complex culture, 50 shades of ethical gray exploded into our consciousness that implicates the entire ecosystem.
- Media buying platforms like to talk the “Contextual” talk yet these platforms fall far short of matching ads to contextual relevant web content. These platforms use “interest category targeting” or keyword targeting which is very limited by either being too broad (the former) or too narrow (the latter). Either way, ad tech ventures overstate their contextual targeting capabilities so marketers spend more ad dollars than they would if true contextual targeting was achieved.
- Agencies face huge margin challenges to compensate for the heavy ad tech tax that cut directly into their profits. In response, they arbitrage across the ad tech supply chain without transparency to their clients, creating a host of ethical issues that erode the trust bonds between agencies and clients over time.
- Publisher and ad networks (even premium ones) use lots of shady tactics to amp up their traffic numbers so they can sell all their traffic – organic and paid – at the highest possible CPMs. In this environment, tonnage trumps marketer KPIs.
- Ad tech platforms (ie SaaS platforms) prefer to sell to advertisers directly leaving agencies to pick up the operational labor gap without any potential to recoup this cost. Platforms are perfectly happy with this arrangement overlooking the gross unfairness leading to friction between tech and agencies to the ultimate detriment of the client.
- Data Management Platforms (DMPs) buy and sell data – 1st, 2nd and 3rd party data – so it gets really murky really fast. Recent Facebook and Google’s egregious user data failures with respect to GDPR are the tip of the ethical data iceberg.
- Traffic authentication platforms are in the business of scoring as much traffic as possible – good and bad so they have no interest in reducing fraud as this Ad Age article explains: “Traffic authentication is the most nettlesome issue in ad tech.” https://adage.com/article/digitalnext/traffic-authentication-nettlesome-issue-ad-tech/309485/.
- Social ad platforms deserve an ethics-challenge call-out when one considers how far they’ve fallen from their high, idealistic social perch. The recent revelations about the inner working of Facebook is representative of ad tech’s general “profits over principles” mantra (Source: New York Times – https://www.nytimes.com/2018/11/15/business/media/facebook-advertisers.html).
This dismal state of affairs is likely to leave one disheartened realizing that great marketing was always about quality, human scale connections– not tech scale. Advertisers are challenged to overcome all these tech obstacles but the landscape is changing. Next Gen platforms are centered on transparency so that advertisers understand what their ad investment is generating.
With that perspective, here’s a few practical steps advertisers can adopt to fight the ethics-challenged culture that now dominates.
- Use acquisition platforms versus performance platforms. Performance platforms charge on a CPA basis (Cost per acquisition) that they then can arbitrage as long as the client is willing to pay the arranged CPA. This incentivizes performance platforms to keep CPA costs as high as possible thus improving their arbitrage profit. Acquisition platforms, on the other hand, use tech specifically to drive acquisition costs down because their fee is transparent.
- Activate long tail publishers for acquisition campaigns. The labor is higher but long tail publishers represent quality traffic that will convert better than even premier publishers because these smaller bloggers/ publishers can’t afford to buy traffic. The juice is definitely worth the acquisition squeeze.
- Beware the seduction to bring marketing functions (ie – programmatic media buying) in-house. On first blush, hiring an in-house person to manage a platform is cheaper than hiring an outside firm to manage it but this severely underestimates the high labor costs and expertise needed to optimize these platforms. By the time the labor costs are fully understood, marketing has lost a lot of productivity, time and money.
The next few years will continue to challenge the industry because it remains with individual marketers to get as educated as possible to hold ad tech platforms accountable. Once that happens, we’ll be able to clean up ad tech town. Welcome to The Trust Web.