Understanding the Evolution of Transparency in Digital Advertising

In digital advertising, it looks like the industry can’t afford its own standards when it comes to real transparency. From brands to agencies to platform vendors, all parties say that transparency in brand-suitable placements and fees are fundamental values, but their actions leave these views somewhat pointless.

From a brand’s point of view, the concept of transparency in digital advertising could not be more simple and straightforward – all they need to tell is:

• Where the ads appeared?
• How much the company paid for those placements?
• How much of their budget went to media and vendor fees?

The fact is that these answers need analysis and reporting, and considering the extent of campaigns today, this is a considerably intricate task to accomplish. Moreover, this complicatedness makes them expensive.

Let’s begin with reporting first.

The first task is to get precise reports, and considering the number of placements in an average campaign, this is no easy achievement. For instance, platforms such as YouTube offer comprehensive reporting, but every minute video content worth 500 hours is uploaded on the platform, which makes reporting somewhat a moving target.

At the same time, programmatic display campaigns are accomplished on a never-ending chain of sites that classify themselves as one thing or another. Now all this can be recorded on a report – but what’s next?

This question takes us to the next challenge – analysis.

Who will review the hundreds of thousands of YouTube videos and URLs of display placements that ran through programmatic media?

Companies expect to get that analysis from their media agencies who expect to get it from their tech partners who again expect to get it from the platforms which, by the way, are not even prepared to do that analysis.

Transparency into fees is another tricky aspect. For example, a brand and agency might agree on the price of 10 bucks cost-per-view. However, it is understandable that the underlying price of media fluctuates; i.e., it is a variable. While some placements might cost just 5 bucks, some might cost 15! Considering the market’s dynamics, agencies actually take up quite a risk when they agree to a fixed price. The pacing and fulfillment criteria will always compel them to spend more than what they agreed to for a lot of impressions, but if they are lucky, these high costs will be counterbalanced by lower cost impressions. It is probable for media agencies to easily make a margin of 40-50% on a few inventories, a figure that might bother or anger a brand. So it’s better to sum the total fees paid simply.

Why Is Tech Not Getting In?

Capturing placements and analyzing brand suitability and fees are tech problems, and well, it’s no secret that today machine learning, artificial intelligence, data science, etc. define this industry. Taking all of these into account, you might be wondering if tech plays such an indispensable role in this industry, why do these problems still exist? Well, we suppose that it’s the industry that does not want transparency because it will reveal some really inconvenient facts.

Online platforms such as Facebook and YouTube are enormous, making it almost next to impossible to ensure brand suitability. A post’s content might be perfectly suitable for a brand even then, within a couple of minutes of publishing it, an irrelevant yet highly toxic discussion can start in the comments, turning the placement into a troublesome one for some companies. Plus, wicked players know very well that social media platforms have reviewers and systems in place, paying attention to specific language and pictures. These players are ambitious to stay a step ahead of them. They might be able to dodge and deceive a detection system by just tweaking the spelling of a hate word. A 99.9% accuracy rate, by all means, is an incredible feat, but given the extent of placements today, even that 0.1% means there are bulks of bad placements out there.

In addition to this, even if these platforms started conducting a one-by-one placement analysis, what about their Section 230 protection of the Communications Decency Act?

If not the platforms themselves, the agencies might be able to do this but are they motivated or incentivized for the same? For example, an agency carries out a campaign targeting adult males (age 30 to 55 years old), and while analyzing the campaign performance, they found that 22% of the ads were placed with minor’s content. Now the agency will have very little motivation to tell its client that they missed their targeting goal by that mark. However, even if let’s say the agency is eager to inform the client about the misaligned targets, it is a strenuous task to finish. Therefore, they will rightly want the client to reimburse them for their endeavor.

In contrast, companies want to achieve a campaign scale at the lowest possible cost. And this mindset does not leave a lot of wiggle room to invest in the contextual alignment technology, which helps companies with brand-suitable placements. From their point of view, brand suitability needs to be presumed. Just the same way, one presumes that the food in a grocery store or meal in a restaurant has been screened by the owner already and is, therefore, safe to consume. However, the truth is that there is a lot of infrastructure built into food safety and quality assurance, and hundreds of inspectors visit these processing facilities daily. Since that cost is distributed among billions of consumers, it is hardly noticeable. Moreover, consumers value the safety and assurance that those inspectors and processes provide them.

Conclusion

Transparency in the digital advertising industry still needs to evolve. All of us want companies to have confidence that their ads targeted the right audience in their brand-suitable placements. But the real question is, how will we get there? Once again, it will be done the same way it has always been working in our industry – communication will drive innovation. Now, this is a pure difficult-to-have conversation among so many components with varying motivations. Extent and sincere transparency can counteract each other, and harmonizing them will require all the parties to make financial commitments and deal with the inconvenient facts fairly that are otherwise easier to keep under wraps. Once this conversation takes place among us, innovation will follow.