Jason Fairchild, co-founder at OpenX talks to M&M Global about the current state of programmatic and digital.
What are your views on the current state of transparency, quality and trust in the programmatic advertising industry?
We’re at a very interesting point in the evolution of programmatic because for the first time quality, clarity, and trust are becoming ‘must haves.’ A CMO Council report found that many CMOs still have significant trust concerns about the quality of programmatic advertising and that’s not surprising given the challenges facing both advertisers and publishers – fraud, domain counterfeiting and hidden fees, to name a few.
Over the years programmatic has brought a lot of benefits to publishers and advertisers, but a wild west of sorts has emerged where hundreds of new companies were created in pursuit of the programmatic gold rush, creating an ‘anything goes’ environment. Today, we’re in the middle of a normal industry maturation process where the ecosystem is being narrowed down to a handful of scaled, high-quality players. That’s a good thing for everyone.
What does the industry need to do to raise the bar on quality and restore trust?
The most important step for the industry is to have all players commit to quality based on well established and documented third-party standards for what quality actually means. When I say commit to quality I don’t just mean companies that include a slide on quality in their pitch decks, or hang nice banners touting transparency at industry conferences, but companies need to make the serious investments and take the necessary steps to truly be high quality partners.
Quality is a choice. Everyone from brands to agencies, DSPs to SSPs and publishers need to do their part to close the gap on fraudulent and non-transparent practices, and restrict technology partnerships to only those that meet clear third-party standards. Ad tech providers either invest in TAG compliance, or they don’t. Exchanges are ads.txt certified, or they aren’t. Companies either comply with GDPR, or they don’t. We need to hold everyone accountable to these industry and regulatory standards to bring actual trust into the supply chain.
How can tech providers improve openness and fairness throughout the supply chain?
Tech partners must take total responsibility for the quality of the inventory they make available to buyers. This requires investment in people, process and technology, including implementing protocols for the number of ads per page, passing placement level viewability data in the bid request, or partnering with third-party verification companies to ensure standards are met. Partners must be honest about the relationships they have with publishers and ideally source inventory directly rather than relying on reselling, whether authorised or otherwise.
Tech partners must also be transparent about the mechanics behind the programmatic auction process – including the methods used to optimise performance – and make it clear which auction type operators they are using. By operating in a well-lit environment, tech providers can help to ensure a fair and open marketplace.
And what good is openness if bad actors are not held accountable? Again quality is a choice. Brands, agencies, DSPs and publishers must hold non-transparent, low-quality companies accountable for their actions by choosing to not work with them.
How successful have initiatives from industry bodies – such as the IAB’s ads.txt – been in the fight against fraud?
The industry is making progress around the fraud and ad quality issues by developing standards that can help buyers choose quality.
IAB’s ads.txt is a great example – it’s the fastest adopted standard in the history of ad tech. Based on our global audit of comScore 1000 publishers we saw adoption grow from 7% to 54% in under six months. Several major DSPs have also made it clear that they will only buy inventory through sources authorised in a publisher’s ads.txt file when one is available. At OpenX we actually recently announced that we are the first major global exchange that will block all reseller traffic that is not authorised on a publisher’s ads.txt file from entering our exchange.
At most there are four or five exchanges that have made the requisite quality investments for brands to know with confidence that their ads are appearing in brand-safe, consumer-friendly environments. We’ve seen this to be true from the handful of scaled exchanges that are consistently the most listed in ads.txt files.
Another way to see how committed your exchange partners are to reducing fraud is to check for TAG certification. After analysing over 6.5 billion display and video impressions in campaigns run through TAG certified channels, The 614 Group found that fraud was 83% lower than the industry average. Both sides of the ecosystem can drastically reduce their fraud challenges by choosing tech partners who are committed to the highest quality standards and have clear protocols and third-party verification in place.
Lastly, what do you think the future of programmatic transparency will look like? What needs to be accomplished in 2018?
I’ll leave you with one thought – clarity in programmatic is not hard. If every buyer made two changes to their contracts they could eliminate the vast majority of fraud and waste. First – work only with exchanges that are TAG certified against fraud. Second – only buy inventory from ads.txt approved sources. We as an industry need to recognise that quality is not only a choice, but one that the future health of our ecosystem depends on.