This article, written by Lewis Rothkopf, General Manager of Supply at MediaMath, originally appeared on LinkedIn.
Like many of you, I read with interest Augustine Fou’s piece, “What a Concept! Buy Media As If It’s 1995,” in which he shares some disturbing examples of middlemen subtracting disproportionate value from media transactions. Also like many of you, I consider Dr. Fou to represent the very best of our industry — he’s a much-needed independent voice in cybersecurity and fraud research and someone whose perspective I hold in the highest regard.
Our opinions differ, however, when it comes to some of the solutions advocated in his latest piece. To be sure, there is no legitimate place for vendors who add no value to the ecosystem — they are a drag on publisher RPMs and do not promote better business outcomes for marketers. Simply put, if you don’t add value to the media transaction, you don’t deserve to be a part of it.
But to paint all intermediaries — “from agencies to ad tech vendors” — with the same brush would be a mistake. When looking at those entities who play a role in the value chain, it is important to separate Black Holes from Shining Stars.
• Roll up, or aggregate publisher supply without adding a layer of value or differentiation such as data enrichment, geolocation or fraud protection
• Misstate the provenance of the supply or their right to resell it
• Are highly discrepancy-prone
• Are often several layers separated from the underlying publisher inventory
Whereas Shining Stars:
• Offer a layer of protection for buyers by offering assurance — and sometimes a guarantee — that the supply is legitimate, safe and fraud-free
• Add value to otherwise-commoditized supply with the addition of data
• Help identify the most appropriate demand for particular inventory
• Innovate on formats with marketers and publishers
• Normalize disparate pools of supply to make them addressable across channels
• Improve measurement and accountability
• Work to keep costs low
Additionally, though it can be tempting to dispose of baby along with bath water and flee from programmatic and its defense mechanisms (and the associated costs of same), doing so is not without significant risk. Dr. Fou acknowledges this in his piece, in which he says, “Of course, the publishers have to be vetted…” and that marketers shouldn’t simply take their word for it.
To this point, I’ve spoken with several publishers in recent months who have a strong understanding about where invalid traffic comes from and who have taken the necessary steps to avoid it. But we’ve interacted with many others who do not yet have such an understanding. One media property whom most would consider to be of the highest quality recently told us that invalid traffic is not preventable by publishers. This is most certainly not an accurate statement, and it was asserted in response to a suspicious traffic inquiry that we raised on behalf of our customers. Of course, when you buy inventory you are also effectively transacting with everyone from whom that publisher has sourced traffic in the past!
Dr. Fou raises several important — and downright horrifying — examples of non-value adding middlemen sucking trust and credibility out of the ecosystem. But turning back the clock to a time when there were no intermediaries facilitating media transactions is not the answer. Lots of things must happen in order to make a transaction possible, safe and effective — including things that can’t be taken for granted, such as data-decorating inventory to make it more addressable, ensuring that the inventory is free of fraud and that the supply source has a right to sell it, and intelligently marrying the right supply with the right demand. These things cost money, and should be considered every bit as much a part of a marketer’s investment in “working media” as the final act of displaying the ad on the web page.
It is in the interest of every legitimate actor in digital media to eliminate Black Holes from the ecosystem. By working together, we can continue to reduce costs and remove points of friction from media transactions, and reach a near future state in which good actor intermediaries are able to compete on their technical capabilities and their ability to drive business outcomes, and not only on their existential legitimacy relative to bad actors.