main

ARTICLE

Lost In Translation: Gaining Clarity Around Adtech Transparency

October 12, 2017 — by Amarita Bansal

This article originally appears in The Drum. 

Right now, ‘transparency’ is the predictive text after adtech.

It is the latest and likely the most enduring concern to hit the advertising industry in recent times. Adtech players have been scrambling to take the lead in defining to their benefit what transparency should mean in programmatic advertising.

In recent months a number of header bidding partners have flooded the marketplace — threatening conventional auction dynamics, launching products that promise choice and fairness through first-price auctions, and forming collectives that aim to work towards standardization in auction set-ups.

To make the bidding process more transparent, OpenX, has launched a new product which explicitly offers bidders a first-price auction option for buying programmatic media. Meanwhile AppNexus, PubMatic and Rubicon Project have joined forces to launch Prebid.org, an independent organisation with the aim of improving the performance of header bidding solutions for premium publishers.

Little wonder then that transparency has quickly become the new buzzword.

But what is really meant by the term? It can be argued that the meaning of transparency has been lost in translation. Depending on a key player’s position in the ecosystem, it can mean a variety of things. The Drum, in partnership with leading global advertising technology company Media.net, decided to get to the bottom of this confusion by comparing what transparency means from each of the key players in the market.

What does transparency mean anyway?

It is challenging to be “transparent” in an industry rampant with undisclosed fees, unfair auctions, data leakages, and agencies hiding rebates.

Transparency in fees across the supply chain: The seriousness of how money is channeled throughout the media supply chain and who eventually pockets what was recently brought to light with The Guardian’s dispute with ad tech firm Rubicon after claiming it failed to disclose fees earned from advertisers that appeared on the publisher’s site. An IAB study from 2015 revealed that less than half (45%) of programmatic revenues in the US reached publishers, while adtech firms ate up the rest.

Transparency in opportunity: In a fully transparent world, all parties have an equal opportunity to respond to every bid with no preferential treatment. Marc Pritchard has implored all facets of the industry to “come together, put down finger pointers, and solve these problems.” But cleaning up one’s actions requires full disclosure about their participation in the problem, according to Media.net’s chief operating officer, Namit Merchant.

“Let’s start by acknowledging complicity and the fact that programmatic can never be like the stock market it is often compared to because all of the participants (publishers, DSPs, exchanges, networks, and marketers) do not disclose how they operate in order to take advantage of the spread,” he says.

Transparency in placement and viewability: To make progress with the ad tech opacity problem, every player in the digital ecosystem needs to be speaking the same language. Ad placement and viewability rates need to be clear. For Ben Walmsley, digital commercial director of News UK, this means everyone should be clear about how advertising is measured.

“Transparency to us means that everybody should be graded by the same standard. There needs to be some clarity and consistency that applies to everybody and publishers have an obligation to accept the standards that they have agreed upon,” he says.

Tom Shields, chief strategy officer at AppNexus agrees. For him, transparency means being able to see exactly what is happening with your transactions in the marketplace, “where they go, if they were viewed, and who gets how much of the spend.”

Transparency in auction dynamics: According to MediaMath’s SVP of business development, Greg Williams, transparency is about looking at it holistically.

“This means looking at the entire supply chain and includes things like ad quality, load time, and latency that impact the customer experience. Is data represented in the right way? From the buy side, it means understanding auction dynamics, how you bid in those environments and what that looks like,” he explains.

If only it was that simple

But in the complicated programmatic supply chain, it is extremely difficult to be certain whether transparency is being honoured. As Williams notes in the context of fraud “it’s a game of cat and mouse in a system of bad actors that are trying to get around the system.”

Buyers feel plagued by hidden fees because ad exchanges and SSPs can use their undisclosed insights into the gap between winning and clearing the bid to arbitrarily inflate the buy-side fee they charge, on an impression by impression basis. This means potentially rigging the model of second-price auctions.

Moving forward, how can the industry adapt a more transparent model? For Walmsley it’s very simple: “The publisher has to take primary responsibility for investigating the contracts. Practices like soft flooring or dynamic flooring of programmatic pricing need to be understood and couched in a language that the buyer and seller understand, and are happy with.”

Merchant refers to the power of data — data that can fuel programmatic revenue and lead to significant yield optimisation.

“Your adtech partner should not just allow for but foster a practice of openness with data. A partner that gives you visibility into buyer and bidding data and works with you to build upon it can deliver real value. But that is exactly what is missing – enough players that encourage end- to-end transparency.”

To read the rest of the article, click here.