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Category Archives: Marketing Accountability

Has Programmatic Been Poisoned Beyond Repair

05 Oct

gsk decision ignites firestormWhen it comes to programmatic digital the rush to employ new technology, without proper vetting or oversight combined with the number of layers between the advertiser and the content provider (i.e. agency, trading desk, DSP, exchange,SSP, publisher) was a recipe for disaster. Toss in a healthy dose of greed and the potential of programmatic was compromised from the onset.

Excellent piece from Tim Burrowes at Mumbrella on the fallout from Martin Cass’ panel discussion at Ad Week in NYC and professor Mark Ritson’s perspective on the future of programmatic  Read More

Scathing Review of Programmatic & Media Agency Standing

03 Oct

cautionIn the recent edition of Marketing Week, writer Mark Ritson profiled a recent Advertising Week panel discussion featuring Martin Cass, CEO of MDC Media Partners and his stated view that clients simply do not have a “grasp of ad tech.”

He believes that: “They don’t understand it. We have become experts on the top of a pinhead and there are probably 1,000 people operating on the top of that pinhead. It’s so utterly bewildering and confusing. If you sat down with a CMO and asked him what most ad tech does he would not have a clue.” Read More

Agency Head Cites Client Trust as a Concern

30 Sep

digital media viewabilityIn a panel presentation at Ad Week in New York, Martin Cass, CEO of MDC Media Partners stated that; “The way major holding companies have been treating clients’ media money without their knowledge is the key factor in the loss of trust by marketers in their agencies, a senior industry executive has claimed.” Are agencies in fact taking advantage of clients’ “lack of understanding: regarding the complexities of digital media … Read more

Financial Times Warns Advertisers of “Jaw-Dropping” Levels of Fraud

27 Sep

fraudAn investigation by The Financial Times (FT) uncovered domain spoofing activity by fraudsters that it found to be “shocking.” The scale of the fraud was broad reaching with over 300 accounts selling inventory alleged to be FT.com’s totaling approximately $1.3 million per month. Anthony Hitchings, the FT’s digital advertising operations director shared his concern; “The industry continues to waste marketing budgets on what is essentially organized crime.” Read More

 

Lawsuits Expose the Seemly Underbelly of Programmatic Digital

25 Sep

fraudsterAt the rate things are progressing in digital media and programmatic trading, the tenuous relationships between advertisers, agencies, ad tech providers, exchanges and publishers are about to come unglued.

While many in the ad industry have had their doubts about programmatic digital, this sector has grown unabated for the last several years. According to eMarketer in 2014 advertisers invested 28.3% of their ad budget in digital media. Their projection is that this will grow to 44.9% in 2020, likely topping $100 billion in total spend. eMarketer estimates that 80% of U.S. digital display activity in 2017 will be transacted programmatically. 

Interestingly, since 2014 the industry has become much more attuned to the risks encountered by advertisers when it comes to optimizing (or should we say safeguarding) their digital media investment. Yet in spite of the findings regarding unsavory practices emanating from the ANA’s seminal 2016 study on “Media Transparency” advertisers continue to pour an increasing share of their advertising spend into this media channel.

However, not all advertisers are continuing to embrace digital media quite as readily as they once did. A handful of progressives, namely Procter & Gamble, have begun to rethink the share of wallet being allocated to digital media and programmatic trading. Marc Pritchard, P&G’s Chief Marketing Officer, has been very outspoken in summing up his company’s position quite succinctly; “The reality is that in 2017 the bloom came off the rose for digital media. We had substantial waste in a fraudulent media supply chain. As little as 25% of the money spent in digital media actually made it to consumers.”

Given Mr. Pritchard’s comments it has been quite intriguing to monitor the legal developments in two high profile lawsuits that have recently been filed.

In the first case, Uber is suing Fetch Media, its digital agency suggesting that it had “squandered” tens of millions of dollars to “purchase non-existent, non-viewable and/ or fraudulent advertising” on its behalf. Uber has further alleged that the agency “nurtured an environment of obfuscation and fraud for its own personal benefit” and that of its parent company, Dentsu Aegis Network. To be fair, Fetch Media has denied what it says are “unsubstantiated” claims by Uber which it claims is designed to draw attention away from their “failure to pay suppliers.”  Allegations include that the agency acted as agent for Uber in some markets and executed principal-based buys in others and that they earned and retained undisclosed rebates tied to Uber’s media spend.

The second case involves RhythmOne, a technology enabled media company and its partner dataxu, a programmatic buy-side platform/ applications provider. RhythmOne originally filed suit regarding $1.9 million worth of unpaid invoices. Dataxu filed a counterclaim alleging that RhythmOne “used a fake auction to consistently overcharge” them and suggested that RhythmOne also “procured inventory from other exchanges, and then marked it up,” both violations of their partnership agreement. As an aside, for the $1.9 million in payments that dataxu admittedly and intentionally withheld from RhythmOne, going back to January, 2017, it is likely that dataxu’s clients had been billed and remitted payment to them. Which raises questions as to how and when their clients will be made whole.

Of note, both of these lawsuits delve into a range of topical issues that pose risks to most programmatic digital advertisers:

  • Agencies executing principal-based buys, rather than acting as agent for the advertiser.
  • The retention of undisclosed rebates tied to an agency’s use of advertiser funds.
  • Non-transparent fees and mark-ups being tacked on to the actual cost of media inventory by multiple middlemen (i.e. agencies, DSPs, exchanges).

These are issues that advertisers should familiarize themselves with and address through the development of a comprehensive client/ agency contract. In addition, advertisers must vigilantly monitor supplier compliance with the terms of those agreements to insure full transparency and, importantly, accountability when it comes to the stewardship of their digital media investment.

As these two cases highlight it is dam difficult for an advertiser to accurately assess the value of digital inventory that is being proffered on their behalf by their agency and adtech partners. Beyond establishing what percentage of an advertiser’s digital dollar actually goes toward media inventory, these separate, but related legal actions demonstrate that it is not just a lack of transparency that advertisers must worry about, but a lack of ethics. When it comes to programmatic digital media the American artist, John Knoll, may have said it best;

“Any tool can be used for good or bad. It’s really the ethics of the artist using it.”

There are steps that advertisers can take to both safeguard and optimize their digital media investment. If you are interested in learning more, contact Cliff Campeau, Principal of AARM | Advertising Audit & Risk Management at ccampeau@aarmusa.com for a complimentary consultation.

19 Sep

ISBA | The Practice – A Creative Digital And Marketing AgencyGlad to see the ISBA contract framework being more universally utilized. The terms and conditions recommended within this document absolutely provide media advertisers with the necessary legal and financial safeguards to protect their interests. This is, without question, the best “first line of defense” when it comes to transparency accountability Read More

In China, Ad Platforms Are Bypassing Media Buying Agencies

14 Sep

big dataInteresting article from Digiday profiling the fact that advertisers in China, seeking more transparency, are moving budget dollars from agency trading desks to Baidu, Alibaba and Tencent (BAT).

Not surprisingly, the agency community is a little less supportive of this approach due to the lower margins affiliated with BAT (i.e. 5%) versus the 50 percent earned from their trading desksRead More.

Is There No End? Deceptive Practices by SSPs Should Alarm Advertisers

13 Sep

risk-icebergCriminal. Is it any wonder advertisers are rethinking their digital media investments. SSPs optimizing yields (theirs and the publishers) by defrauding advertisers raises serious concerns centered, once again, around the lack of transparency.

Deceptive price price floors, misstated bidding methodologies lying about which publishers they represent and the unauthorized reselling of inventory are practices that must be halted. Advertisers would be right to ask; “Where is my media agency? Why aren’t they protecting my interests when it comes to preventing this type of abuse?” Sad state of affairs Read More.

Who’s Funding the Growth in Martech?

13 Sep

fundingScary article in Mediapost. According to WARC out of London, martech fees now represent 16% of marketing budgets.

Where does this money come from? Marketers aren’t increasing their budgets by this amount. Agency fees haven’t gone down by this amount. Third party vendor expenses haven’t decreased by this amount. Must have come directly out of advertiser message delivery…

Wonder why advertiser’s are questioning marketing efficacy in the wake of stagnant brand growth? Read More

Auction Price Models: Buyer Be Aware

06 Sep

transparencyInteresting article in MediaPost dealing with the vagaries of programmatic digital media auction methodologies.

Rogue players, operating with little or no transparency, without the agency buyers even knowing what auction methodology is being utilized to establish inventory pricing/ select winning bids… Is it any wonder why advertisers such as P&G, Unilever, L’Oreal and others are rethinking their digital media investments? Read More

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