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September 27, 2019, Article

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Up To Half Of Ad Spend Still Wasted: MediaMath’s Gerszke

This article originally appeared on Beet.TV.

The outcry over “transparency” in the digital ad ecosystem grew to a crescendo three years ago now, when the ANA’s K2 Transparency Report accused agencies of operating a system of rebates and kickbacks that worked against brand clients by hiding substandard effectiveness.

That was just one piece of the problem. Ad-tech vendors also stood accused of obfuscating “ad-tech tax” fees siphoned away from real advertising spend.

Since then, the barely a week has gone by without various companies mooting solutions to the problem.

But, whilst a consensus has gathered that progress has been made, one of the leading ad-tech companies thinks the problem remains chronic.

“Surprisingly little progress has been made since, I think, two or three years ago,” Konrad Gerszke, president of MediaMath, says in this video interview with Beet.TV.

“The ecosystem has evolved into a situation where there’s a lot of fraud across various steps in the supply chain because of a lack of transparency. As a result of that, there’s a lot of money wasted that the brands and the agencies are investing.

“What we see in certain test we are driving is, between 20 and 50% could be wasted.”

That estimation will shock many in the industry, who believed that matters were improving.

“A lot of the advertisers were starting to get on the barricades to hold the industry accountable for all the spend that is going in the industry.

Gerszke thinks the ongoing problem needs solving through three “pillars” of accountability, addressability and AI. Specifically, through three measures:

  1. “Transparency, end-to-end, (so) that we know who the players are across the supply chain.”
  2. “We know what the fees are across the entire waterfall.”
  3. “And we know who the bad players are and who the good players are.”

MediaMath operates data management platforms, omnichannel DSP, audiences, supply and intelligence services.

This video is part of a series of interviews conducted during Advertising Week New York, 2019.  This series is co-production of Beet.TV and Advertising Week.   The series is sponsored by Roundel, a Target company.  Please see more videos from Advertising Week right here

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