This post is by David Angell, TrinityP3 General Manager and Head of Media. David has extensive commercial and media experience gained through a fifteen year career in media agencies, which he uses to help drive optimal results for TrinityP3 clients.
Commentary regarding the various issues facing the digital advertising industry continues to grow. Dishonesty, corruption, complexity, lack of knowledge, inadequate marketing, inadequate agencies, inadequate measurement…the list goes on.
Based on the work we do with our clients, these issues are certainly becoming more recognised – even if many advertisers are still extremely challenged in their understanding of who, or what, they need to look at.
The trouble is, so much of the commentary lacks objectivity.
Cutting a far better path is Marc Pritchard. Here’s a repeated but still refreshing sentiment from P&G’s CMO, in his recent speech to the ANA conference in Orlando, Florida.
[Media-agency relations] have become frayed by too much complexity, murkiness and waste in the supply chain that all of us have had a hand in creating.
What I like about this is that, first, he references media agency relations – not media agencies, not marketers, but the quality of relationship between them. Secondly, the phrase ‘all of us have had a hand’. The unbalanced agenda, so prevalent in this fraught and on-going debate, is largely absent.
Of course, Mr Pritchard has become relatively famous for his own recent admission that P&G had themselves been behind the 8-ball, at least contractually speaking. This further commentary shows that he’s actually ahead, not behind, when it comes to apportioning responsibility and considering the implications.
In short – we’re all responsible. We’re all to blame.
Media agencies and their Holding Company parents and affiliates
…are to blame for pushing a low-cost, high volume inventory model, ultimately designed to generate maximum commercial returns for the agency, rather than the client. They’re also at least complicit in the construct of the much talked about ‘murky supply chain’ by failing to create properly transparent cost structures.
The media agency problem is a part of the greater ‘media agency transparency’ debate, referenced repeatedly over the last 18 months and led by the industry-shaking K2 Intelligence report commissioned by the ANA which alleged systematic practices – opaque at best, corrupt at worst, by agencies in the US market.
Various technology providers
…are to blame, complicit as they are in contributing to the ever-expanding network of intermediaries that sit between buyer and seller, accounting for the WFA’s estimated 60c in the client’s media dollar being taken in undisclosed fees.
Clients and industry bodies are finding it increasingly difficult to isolate the actual value being provided by the plethora of advertising technology (ad-tech) suppliers (examples of ad-tech include ad-serving and ad-verification technology stacks, marketing analytics software, DSP providers, DMP providers, SSP providers, Ad Exchanges) that can sit between buyer and seller.
Venture Capitalist groups
I read another interesting theory from Judy Shapiro, writing in Adage. Judy’s contention is that it is actually Venture Capitalist groups, with limited marketing and media knowledge but a distinct liking for ‘cool ad-tech’ who are actually bankrolling a group of engineers (who also don’t have much understanding of marketing) to produce ever-more derivative ad-tech solutions, which also drive a lowest-common-denominator approach to purchasing digital inventory (low cost, high volume, debatable quality).
The media sales networks
…are to blame for over-protection of quality inventory from day one, for walled gardens and lack of independent or consistent measurement metrics, and for releasing sub-standard inventory in large quantities into the open market, to be hoovered up by the CPM-chasing traders.
We only have to look at the recent measurement issues suffered by Facebook to see that even the biggest networks are not immune – in fact, in Facebook’s case, it has been a massive fail which has fueled the fire for a single source, global and independent system of measurement, based on viewability guidelines such as those offered by the US-based MRC (Media Ratings Council).
With regard to sub-standard inventory – well, various ‘private exchange’ deals now exist that provide greater access to programmatically traded premium inventory. And you can’t wholly disagree with the advertising networks for wanting to protect their revenue base.
But sub-standard inventory is not just about ‘premium’; it is about control of who is able to access the advertising supply chain and as a result, put spaces on their sites for brands to fill.
The recent challenge faced by Google is the biggest single example of this problem, and has resulted in major UK advertisers removing budget from the Google Display Network until Google can guarantee that their brand advertising will not appear in completely inappropriate environments.
Granted, the internet is vast and control is difficult. But Sir Martin Sorrell is, in my opinion, completely correct in his recent statement that “They (Facebook and Google) can’t just say – look, we’re a technology company, we have nothing to do with the content that is appearing on our digital pages.”
Sorrell maintains that digital providers should be held accountable to the same environmental standards as traditional media platforms, and it is very hard to argue with.
…who have created a multi-billion dollar ad-fraud industry are to blame for…well, for being criminals.
There isn’t much more to say here, other than the fact that the size of the ad-fraud industry – common forms include fake or ‘ghost’ websites that carry paid advertising, and bot-net fraud, whereby a computer poses as a human and clicks on banner adverts, creating fake traffic paid for by the advertiser – is only expected to grow in size, as cyber-crime becomes more sophisticated.
But consider this: if the industry had not evolved towards automated purchase of predominantly low-cost inventory, traded on volume terms, would ad-fraud have become so successful?
Anyway: this particular part of the mess is no longer just about the media world; it’s a matter of macro-economics, because it is robbing billions of dollars from the economy, and as such, it requires global legislation and a step-up in law enforcement, as some commentators have noted.
…are to blame for having their heads in the sand, for signing opaque agency contracts without applying due governance, and for persisting with outdated ways of determining advertising effectiveness. It’s not always the agencies persuasion; sometimes, it’s the marketer’s desire.
It must be extremely challenging for marketers, as the pressure increases and tenures shorten, to be motivated or brave enough to really break with traditional forms of agency agreement, metrics and measurement. But it’s needed. Marc Pritchard has said that only by getting ‘into the weeds’ was he really able to understand, as a CMO, the size of the issue.
Head in sand mentality at senior level just won’t cut it in terms of attempting to improve, evolve and solve.
Procurement, the C-Suite
When they are involved, these parts of corporate organisations – procurement, the C-Suite – are to blame for pushing a cost over value agenda when it comes to external supplier arrangements, for leaving marketing to its own contractual devices, and for failing to understand or respect the intricacies of what they’re dealing with in the media space.
In addition, it’s worth considering that Marketing as a discipline is, generally speaking, often not given enough airtime or seniority within the C-Suite. If marketers had been properly empowered, as well as being better guided from a compliance perspective, perhaps the marketer problem I’ve talked about in this article would not be so acute.
Various industry commentators and journalists
…are to blame for exploiting an ‘us versus them’ mentality, or for pushing a ‘digital’ or ‘anti-digital’ agenda when, for pity’s sake, surely there should be more balance – in strategy, in opinion, in content production, in tactical advertising channel decisions.
Despite the work they’ve done more recently, industry bodies are to blame for not acting quickly enough over the last ten years, and in some cases, for lacking true independence.
And finally, consultants are to blame for doing too much talking, not enough listening. Which, clearly, I am probably guilty of in this article. But self- recognition is the first step to recovery and I apply this to myself, and to my square in the jigsaw, as much as to anyone else.
When is this industry going to wake up and self-recognise?
Let’s face it, from whatever lens we care to look through, the bright shiny thing that is digital marketing has seriously lost its sparkle.
As reported in the recent ANA conference, overall US sales, aided by the bright shiny ball that is digital advertising, have declined since 2014 rather than increased. The light of brave new world promised is flickering at best. People are realizing that the promise may not be there – at least not in the way that they thought, using the methods that they are.
With all the challenges we face, coupled with huge advertising entities like P&G starting to make serious threats, the digital advertising industry could, quite conceivably, collapse in on itself. But that is not what we should want.
My best guess at a solution is first, for more people like Marc Pritchard to get themselves on that road to recovery, starting with self-recognition and progressing to the kind of balanced, honest thinking he has exhibited. And secondly, for this to be more than talk; for it to trigger the bottom-up change required to reset what seems to be an inescapable course we’ve set ourselves.
This article was originally published in shorter form in Campaign Asia magazine.
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