From the dawn of the programmatic era, advertisers and publishers alike have condemned the murkiness of the programmatic supply chain and asked for greater transparency.
We’re calling on all marketers to stop asking for transparency and start demanding it. Refuse to work with any ad tech company who can’t provide it. That’s the only way we’ll change the status quo.
Transparency in programmatic advertising means that marketers know exactly where every cent of their campaign budgets goes. That is, they would know how much makes it into the pockets of publishers, versus how much goes to the various ad tech providers who keep the supply chain moving.
Very few marketers have this level of transparency – and most don’t know what the fees are - which makes it virtually impossible for them to fairly evaluate their programmatic partners and eliminate the ones who can’t justify the fees they extract. This would be considered an outrage in any other industry, but not digital advertising.
Some marketers may think they’re better off moving spend away from programmatic or not embracing it at all. But with programmatic forecast to reach 55.1% of digital advertising next year, opting out of programmatic would mean cutting yourself off from a big chunk of digital ad inventory, not to mention the emerging types of inventory that will primarily be transacted on programmatically.
This is, however, a solvable problem. All the data generated by programmatic transactions – including the prices paid to publishers and the programmatic providers – is logged and available for marketers. They just need to demand it, and refuse to work with those who can’t or won’t provide it. But first, marketers need to know who the intermediaries along the programmatic supply chain taking pieces of their budget are - and the new third parties who can help quantify those pieces.
Think you’ve got transparency? Probably not
Many marketers think they already have an adequate understanding of where their programmatic budgets are going because they know how much of a cut their agency or DSP takes.
But the programmatic supply chain stretches far beyond the DSP before it reaches the publisher. Below is a list of the other types of intermediaries who sit between marketers and publishers.
- Ad blocking service
- Ad server
- Data segment providers
- Data management platform
- Viewability partners
If you can’t name the partners you work with in each of these categories, describe the work they do for you, and name the exact percentage they take from each of your programmatic buys, then you haven’t achieved transparency.
How can you fix this?
Now that you know who the intermediaries are, you can start the process of auditing them.
- Ask your current agency or DSP. Ask who you work with in each of the categories listed above and how much they make on each individual ad buy. If they can’t give you an exact breakdown, then you need to get in touch with those companies yourself and ask how much they take out of each programmatic transaction.
- Reach out to a transparency provider. If you can’t get transaction data from your programmatic intermediaries you can also work with one of the ad tech transparency providers that have surfaced in recent years. These companies use blockchain and other new technologies to audit the programmatic supply chain to say with certainty how much of your budget goes to which intermediaries and how much goes to the publisher. Examples of these providers include Amino Payments, AdFin, and Lucidity.
Most importantly, refuse to work with anyone who doesn’t give you this basic and readily available information. There’s no reason they shouldn’t provide it.
Transparency is the key to a better internet
At AppNexus, our mission is to build a better internet, and we firmly believe that programmatic is at the foundation. By creating an open, real-time market for digital ads, we can give more marketers greater access to their audiences, put more money in the hands of high-quality publishers, and give users a more positive, relevant digital ad experience.
But first, we need to solve the transparency problem. Advertisers can’t continuously improve their programmatic campaigns if they can’t fairly evaluate all the providers involved. The data they need is out there – so demand it now.
By AppNexus lead solutions consultant Niki Banerjee