Transparency: The New Table Stakes
•Download as PPTX, PDF•
0 likes•530 views
This document discusses the need for transparency in digital advertising to rebuild trust. It summarizes findings from a 2016 study that found rebates and markups were prevalent and sometimes obscured. The study highlighted that loss of trust was the biggest issue and that agencies can no longer deny transparency issues exist. It also notes that only 25% of ad targeting was accurate for common demographics. The document advocates favoring transparent partners and amending contracts to standardize metrics and thresholds. It predicts agencies will need to increase transparency on margins, brands will build more in-house capabilities, and DSPs will consolidate with demands for inventory and fee transparency.
Recommended
Recommended
More Related Content
What's hot
What's hot (14)
Similar to Transparency: The New Table Stakes
Similar to Transparency: The New Table Stakes (20)
More from MediaPost
More from MediaPost (20)
Recently uploaded
Recently uploaded (20)
Transparency: The New Table Stakes
- 1. TRANSPARENCY THE NEW TABLE STAKES ALEX SUTTON III Global Director, Digital Acquisition
- 2. TRUST IS A BELIEF THAT ONE’S VULNERABILITIES WILL NOT BE EXPLOITED
- 3. “Our inventory is brand safe and mostly viewable” “Our audience targeting and bid strategies are award winning” “Our first party data is unique and relevant” “Our CPM’s are fair” IN THE ABSENCE OF EVIDENCE, TRUST HAS TO BE ASSUMED
- 4. TO BE MAINTAINED, TRUST NEEDS OCCASIONAL CONFIRMATION AND TO DO THAT, WE REQUIRE TRANSPARENCY
- 5. TRUST IS ERODED WHEN THERE IS EVIDENCE TO CONFIRM YOU HAVE BEEN EXPLOITED
- 6. WHAT’S ERODING OUR TRUST IN THE MARKETPLACE?
- 7. MARKUP METHODOLOGIES REBATES & KICKBACKS GROSS, NET, MARKUPS. OH MY!
- 8. “REBATES ARE REAL AND THEY ARE PERVASIVE” • Cash rebates from media suppliers were provided to media agencies, with payments based on the amount spent on media. • Rebates in the form of free media inventory credits. • Rebates structured as “service agreements” in which media suppliers paid media agencies for non-media services. Sources told K2 Intelligence that these services “were being used to obscure what was essentially a rebate.” K2 Intelligence study, conducted on behalf of the ANA, July 18, 2016 • Markups on media sold through principal transactions ranged from approximately 30 percent to 90 percent. • Media buyers were sometimes pressured or incentivized by their agency holding companies to direct advertiser spend to media bought through principal transactions. • There were reports of dual rate cards. • Non-transparent business practices sometimes resulted from media agencies holding equity stakes in media suppliers. “AGENCY CONDUCT WAS CONCEALED BY PRINCIPAL TRANSACTIONS”
- 9. THERE WERE SEVERAL IMPORTANT LESSONS FROM THE K2 INTELLIGENCE STUDY: • The loss of trust was the most significant and important manifestation of the issue. • Agencies can no longer deny that the “rebate issue” exists in the United States, along with a host of other transparency-related issues. To continue that denial would seriously undermine any hope of restoring the equity in the client/agency relationship. Detection, distraction, and denial are not the strategic pillars that will bring resolution. • Advertisers must rethink their collective set of media management practices. The deterioration of accountability and oversight — particularly with respect to contracts — cannot continue. Advertisers must establish their primacy over the process to increase the ability to optimize client/agency relations in the future. Media management governance needs to be rethought and reconsidered. K2 Intelligence study, conducted on behalf of the ANA, July 18, 2016
- 10. MIDDLEMEN WHAT IN THE… MEDIA SUPPLY CHAIN? “PROGRAMMATIC” INDUSTRY STANDARDS DATA SOURCING PETER AND PAUL INVENTORY BID ALGORITHMS BRAND SAFETY
- 11. ONLY 25% ACCURACY ON DEMOGRAPHIC TARGETING? Source: “The Next Frontier in Ad Quality: Targeting Accuracy” Whitepaper published by Quantcast. May 2015 “Media agency Mediasmith conducted a study testing the demographic targeting accuracy of 11 data vendors and used Nielsen and comScore to validate accuracy in reaching common demographic segments – such as males 18-34 and females 25-54 – through programmatic display inventory.”
- 12. HOW ARE WE ADAPTING AND REBUILDING TRUST? 11
- 13. 12 FAVOR THOSE WILLING TO BE TRANSPARENT CONSISTENT RELIABLE LOYAL COMMITTED HONEST
- 14. HOW WE’RE RETHINKING MEDIA MANAGEMENT Standardizing KPIs and media thresholds across global teams and partners Amending contracts with Agencies and DSPs Staffing ahead of the curve 13
- 15. Agencies will continue to operate as they are masters of negotiation but they’ll have to evolve to increase their transparency to margins Brands will build in-house capabilities and expertise to deliver efficiencies THE NOT SO DISTANT FUTURE DSPs will consolidate with increased demand for transparency to inventory, fees, base prices
- 16. THANK YOU ALEX SUTTON III
Editor's Notes
- Today’s Agenda: Brand direct marketer’s approach to programmatic,ABG’s/Alex’s unique approach 2. Learn a bit about how transparency and trust are shaping programmatic as a whole 3. Tactics brands are employing to push transparency (something like that) At the end of the day, I am tasked with driving incremental renters through our paid digital marketing but like most companies our goals were a bit schizophrenic (we want go up the funnel but are anchored to high ROI), we want to use MTA, but ROI may look better under last click,
- In the absence of evidence to the contrary trust has to be assumed. With evidence to confirm you have not been exploited , trust is asserted. With evidence to confirm you have been exploited, trust is eroded.
- In the absence of evidence to the contrary trust has to be assumed. With evidence to confirm you have not been exploited , trust is asserted. With evidence to confirm you have been exploited, trust is eroded.
- Unfortunately, With ever increasing availability of information (transparency) in the programmatic world we’re seeing erosion of trust between brands agencies and vendors
- Rebates and kickbacks – I’ll cite the ANA/ K2 study and several of it’s findings about agency trading desks and vendor rebates
- Rebates and kickbacks –ANA/ K2 study and several of it’s findings about agency trading desks and vendor rebates
- Rebates and kickbacks –ANA/ K2 study and several of it’s findings about agency trading desks and vendor rebates
- Media supply chain is not easily understood by decision makers – there’s a lot of “middle-men” The spectrum between Advertisers (client) and Publisher The Jargon we use has no consistency (e.g., programmatic – ask 5 people) Black box agency and Media Vendors Inventory? Criteo? Audience and data sourcing Studies from Google or Comscore or Quantcast, looked at demographic data accuracy, simply between male/female. If you can’t trust them with basics, how can you trust detailed segments?
- Audience and data sourcing Studies from Google or Comscore or Quantcast, looked at demographic data accuracy, simply between male/female. If you can’t trust them with basics, how can you trust detailed segments?
- At the end of the day, I am tasked with driving incremental renters through our paid digital marketing but like most companies our goals were a bit schizophrenic (we want go up the funnel but are anchored to high ROI), we want to use MTA, but ROI may look better under last click, (add more)
- Adding language to contracts addressing transparency with agency and dsp contracts (rebates, value add should be pass through as savings to brands) Sharing rebates, NET vs Gross markup, and margins, line-itemed in contracts Share their data sources and attribution methodologies Guarantee viewable inventory
- Standardization of global KPIs and process for third party measurement across MTA and Viewability partners (speak to our global approach to standardizing measurement so we can compare apples to apples, building a body of evidence so EMEA peers don’t have to assume trust they can see it for themselves) For example, 50% viewability threshold, frequency capping, 40% incremental threshold for each partner ABG revised their contracts, added DV, adding Language to address transparency with agency, rebates and dsp contracts, Hiring ahead of the curve, in-house traders to guide execution
- Agencies will continue to operate as they are masters of negotiation but their margins will shrink with proliferation of the fixed fee model and increased transparency to margins. DSPs will consolidate and with increased demand for transparency to sites, fees, base prices, etc… Brands: Under increasing pressure for marketing dollars to deliver higher returns brands will build out in-house capabilities and expertise to deliver efficiencies (this is not as wide spread as some trade publications suggest but it will grow and the conversations are happening everywhere)