50 shades of AdTech ethical gray.

Judy Shapiro

Judy Shapiro

Editor-in-Chief at The Trust Web Times
Judy Shapiro

Judy Shapiro

Editor-in-Chief at The Trust Web Times

Conversations about trust and transparency in ad tech are vexing because complexity in the AdTech supply chain makes accountability excruciatingly tough. Within this complex culture, 50 shades of ethical gray exploded into our consciousness that implicates the entire ecosystem.

  • Media buying platforms like to talk the “Contextual” talk yet these platforms fall far short of matching ads to contextual relevant web content. These platforms use “interest category targeting” or keyword targeting which is very limited by either being too broad (the former) or too narrow (the latter). Either way, adtech ventures overstate their contextual targeting capabilities so marketers spend more ad dollars than they would if true contextual targeting was achieved.    
  • Agencies face huge margin challenges to compensate for the heavy adtech tax that cut directly into their profits. In response, they arbitrage across the adtech supply chain without transparency to their clients, creating a host of ethical issues that erode the trust bonds between agencies and clients over time.
  • Publisher and ad networks (even premium ones) use lots of shady tactics to amp up their traffic numbers so they can sell all their traffic – organic and paid – at the highest possible CPMs. In this environment, tonnage trumps marketer KPIs.    
  • Adtech platforms (ie SaaS platforms) prefer to sell to advertisers directly leaving agencies to pick up the operational labor gap without any potential to recoup this cost. Platforms are perfectly happy with this arrangement, overlooking the gross unfairness of this arrangement, leading to friction between tech and agencies to the ultimate detriment of the client.    
  • Data Management Platforms (DMPs) buy and sell data – 1st, 2nd and 3rd party data – so it gets really murky really fast. Recent Facebook and Google’s egregious user data failures with respect to GDPR are the tip of the ethical data iceberg.   
  • Traffic authentication platforms are in the business of scoring as much traffic as possible – good and bad so they have no interest in reducing fraud as this Ad Age article explains: “Traffic authentication is the most nettlesome issue in adtech.”   https://adage.com/article/digitalnext/traffic-authentication-nettlesome-issue-ad-tech/309485/.
  • Social ad platforms deserve an ethics-challenge callout when one considers how far they’ve fallen from their high, idealistic social perch. The recent revelations about the inner working of Facebook is representative of adtech’s general “profits over principles” mantra.

This dismal state of affairs is likely to leave one disheartened if not for a new, emerging sensibility that understands great marketing is always about quality, human scale connections– not tech scale. With that perspective, here’s a few practical steps advertisers can adopt to fight the ethics-challenged culture that now dominates.  

  • Use acquisition platforms versus performance platforms. This sounds like a subtle difference but understanding this difference can mean success or failure in your acquisition ROI programs. Performance platforms charge on a click basis leaving them plenty of room to arbitrage the cost they pay for a click versus what they charge a client. The key strategy for performance providers is to buy the crappiest traffic possible in a, “throw everything at the wall to see what sticks,” that has some level of CTR. As long as the Client is willing to pay the arranged CPA, performance marketers pay the lowest CPC they can get away with.  This incentivizes performance marketers to keep their CPA costs as low as possible while telling the Client the highest cost for a CTR as possible. At no point does a performance marketer disclose the actual CPC cost to the Brand. The upshot is that an Advertiser will never know if the cost to acquire a marketing qualified lead should be $1 or $10.  Acquisition platforms, on the other hand, use tech specifically to drive acquisition costs down because their fee is transparent.

The key strategy for performance providers is to buy the crappiest traffic possible in a, “throw everything at the wall to see what sticks,” that has some level of CTR for Advertisers. As long as the Client is willing to pay the arranged CPA, performance marketers pay the lowest CPC they can get away with.

  • Activate long tail publishers and direct buys for digital ad campaigns. The labor is higher but quality and long tail publishers, like B2B, represent real people traffic that will convert better for Advertisers.  
  • Beware the seduction to bring marketing functions (ie – programmatic media buying) in-house. On first blush, hiring an in-house person to manage a platform is cheaper than hiring an outside firm to manage it but this severely underestimates the high labor costs and expertise needed to optimize these platforms. By the time the labor costs are fully understood, marketing has lost a lot of productivity, time and money.  

The next few years will continue to challenge the industry because it remains with individual marketers to get as educated as possible to hold adtech platforms accountable. Once that happens, we’ll be able to clean up adtech town. Welcome to The Trust Web.

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