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Perspectives

The war on ad fraud: Why publishers need an armory to win the battle

It’s difficult to track the true cost of ad fraud, with estimates varying from $5.8 billion to $23 billion in 2019. But no matter what the estimate, fraudsters are taking advantage of the programmatic ecosystem’s complexities to funnel ad dollars to fake websites that should be going to legitimate publishers.

Yet digital publishers have power in the fight against ad fraud. In fact, the websites that are doing everything right can be a major part of the solution to the digital ad fraud problem. Publishers can take steps to reduce fraud and get rewarded for their quality content and audience.

The impostor problem

Media buyers have thousands of sites to choose from when buying ads programmatically. Their problem isn’t a lack of options; it’s having assurance that the sites are legitimate with human audiences. Fraudsters can create bots to look like humans, and fake sites to look like premium sites.

That’s where the fraudsters are winning. They enter the advertising ecosystem with an army of bots that look legitimate enough to fool media buyers into believing they’re placing an ad in front of their target audience at a lower cost than a premium site. Quality sites end up competing with illegitimate sites that look legitimate, though they don’t offer advertisers human audiences.

Fake websites and fake users give advertisers no return on their investment. Both publishers and advertisers lose because the money intended for a legitimate publisher is diverted into the pockets of bad actors.

One solution isn’t the solution

There are many valuable anti-fraud tools available today including fraud detection software and inventory/seller verification initiatives such as ads.txt. While it’s important for publishers to incorporate accredited solutions into their anti-fraud arsenal, it’s also important not rely solely on any one solution.

For example, the 2019 ANA/White Ops Bot Baseline report revealed that less than half of all ad impressions are able to be fully, transparently validated by measurement tools. Fraud detection companies use different methodologies that produce varied results whether the ad campaigns or the publishers’ pages are tagged.

As another example, sourced traffic may be engineered to pass through fraud detection technologies. A publisher may think that the ad fraud detection tools they have in place are preventing fraud from occurring on their website, but sourced traffic may introduce bots unknowingly.

Since there are many angles to the ad fraud problem, it takes a multi-layered, integrated approach to confront the problem as well. Publishers have opportunities to go beyond current solutions and stand out as quality publishers.

What publishers can do

It’s important that publishers use a holistic approach to ad fraud prevention and detection that incorporates a variety of solutions to ensure all aspects of a website are covered from traffic sources to ad delivery. There are several steps publishers can take to limit their exposure to ad fraud and reduce the risk to their media buying clients.

Follow best practices for driving traffic to your site

Take advantage of your content that attracts human audiences and promote it through legitimate marketing methods such as paid ads, e-newsletters or social media. Don’t source traffic, which can invite invalid traffic to your website. Monitor traffic sources to identify any suspicious patterns. Filter traffic from bots and data centers to prevent ads from being served to invalid traffic.

Educate your clients

Communicate how your quality content gives media buyers a greater return on investment. Inexpensive ads may generate lots of clicks at a lower CPM than ads on premium websites, but nonhuman clicks will never convert into paying customers. Quality content attracts human audiences. Next time you have a client meeting, simply ask, “Are you sure you are advertising on quality sites?” An educated advertiser will understand the value of investing in human audiences and quality publishers will get rewarded for their hard work.

Implement industry solutions

While no one solution can solve the entire ad fraud problem, integrating multiple tools into your overall fraud protection plan can go a long way. Adopt tools such as ads.txt, IAB Tech Lab’s OpenRTB Version 3.0, and accredited ad fraud detection software.

Engaging in an independent, third-party website audit can identify areas of risk and help publishers make improvements. A website audit also assures advertisers that steps are being taken to provide them with the highest level of transparency and a safe place to reach their target audience that will provide a greater return on their media investment.

Learn more about what you can do to help minimize ad fraud by downloading the AAM white paper: Three Truths That Help Confront the Digital Ad Fraud Crisis.

Perspectives

DCN’s must reads: week of June 13, 2019

Here are some of the best media stories our team has read so far this week:

Perspectives | Revenue

How publishers can unlock outcome-oriented advertising models

For anyone working in ad tech for more than a few years, the publisher monetization challenge comes as no (major) surprise. Ever since the ecosystem divided itself into demand-side and supply-side with the “impression” as the primary currency traded over automated exchanges, it was only a matter of time until the side “closer to the money” would overshadow the other.

While digital-native publishers quickly embraced these models and optimized their traffic for automated buying, traditional publishers (typically in print negotiating the “digital transition”) faced a different story. Most assumed that brand and editorial quality would ensure buyer competition to lift prices. However, this intersection of traditional and digital publishing ultimately diluted the value of these brands given the surge in digital inventory and resulted in disappointing “fair market value” in a CPM world.

Publishers are now in a race to (re)create value for their content, as we see two main trends emerging:

1. Creating alternatives to platforms by aggregating scale and data

To better compete with the scale and data capabilities of the Google-Facebook duopoly, premium publishers in various global markets, including the US, have formed alliances. The jury is still out on whether this model will ultimately succeed, forcing competitors to work together while balancing “infighting, lethargy ,and incompatible data and systems.”

2. Aligning business models with editorial expertise – content and experiences

Publishers have recognized that advertising revenue is not linear with content “quality” particularly with the emergence of programmatic buying as quality has given way to reach and data targeting. Therefore, publishers are diversifying their revenue and incorporating subscription models to be paid on their own definition of quality.

Beyond creating various flavors of paywalls for their readers, something deeper is happening. Publishers are rethinking their approach of the digital ecosystem to their advantage.

The next generation of publisher direct sales

Similarly, on the advertising front, publishers can now leverage technology, data, and AI to unlock new opportunities and empower their sales teams to better compete against the duopoly and challenge legacy ad transaction models.

Publishers can and should move beyond the traditional CPM model and move towards advanced outcome-centric models (i.e., CPCV, CPiV, vCPM, etc.) to compensate for intrinsic scale limitations while better meeting the true goals of their advertising clients. Combined with premium context which results in better ad performance and engagement, these new models should become part of publishers’ core strategy to reinvigorate their advertising revenue and maximize the value of their content.

How do we move towards this new model?

Moving “closer to the money” and further up the value chain requires publishers to start a deep, cooperative discussion with advertisers. They will then need to create packaged, scalable solutions to address their specific challenges. To succeed with highly qualified but limited footprints, these solutions need to leverage all possible optimization levers towards advanced, advertiser-centric KPIs (i.e. leads, completed video views, etc.).

For example, to run a successful CPCV (cost per completed view) campaign, optimization starts with the creative itself (along with the data set, user-definition and targeting) to AI that will model reader behavior to identify the most probable combinations that will lead to video completion (which ultimately limits inventory waste).

Looking beyond the supply side view

Unfortunately, most publisher ad tech stacks solely aim at optimizing the supply-side view of the world, while most of the high-value operations occur on the demand-side platforms. Publisher technology typically stop at the “CPM wall” leaving out most of the optimization levers that help drive the most conversions from a given impression.

Publishers need to adopt tech stacks that use AI to also compute demand-side data-points, similar to those used by DSPs to extract the most value from their inventories. In addition, these tech platforms also need to support outcome-centric optimized transaction models beyond CPM.

Only a limited number of ad tech companies have a comprehensive vision that spans across both demand-side and supply-side visions of the world. And even fewer have the scale to make their capabilities relevant or share them directly with publishers instead of to their own benefit. The publisher ad tech stack of the future will ensure that advertisers can deliver advanced KPIs while preserving and optimizing the publishers’ inventory.

About the author

Federico Benincasa is SVP Product for Publisher Solutions at Teads leading the Teads Publisher Suite initiative, a full-stack solution leveraging all the company’s proprietary technological assets. Former adtech entrepreneur, Federico is a recognized industry veteran and recently led the Product team for the StickyAds video SSP before becoming SVP of Product for Freewheel’s Digital Video full stack.

Perspectives

DCN’s must reads: week of June 6, 2019

Here are some of the best media stories our team has read so far this week:

Featured Post | Perspectives | Policy

Behavioral advertising: The mirage built by Google

Important new research was recently presented at a major economics conference and reported on by the Wall Street Journal. The comprehensive study was conducted over nearly five years by Veronica Marotta, Vibhanshu Abhishek and led by Alessandro Acquisti, who is globally recognized for his work studying behavioral economics and the impact of privacy on digital society. The bottom-line: Acquisti’s team found that behavioral advertising, as measured and delivered based on third party cookies, increased publisher revenues by a mere 4%.

If you’re nodding your head unsurprised by this statistic, then you’re likely in the 67% of publishers surveyed recently by Digiday who answered that behavioral advertising doesn’t help their business. But make no mistake, the findings are profound as to how they inform the future of digital advertising. They will also have a strong influence on the next steps in US privacy legislation. Put simply, nearly all of the growth touted by the industry benefits intermediaries rather than the publishers who provide the news and entertainment. And for the first time ever, there is empirical research to dismiss long-touted industry arguments that privacy rules will kill the golden goose that pays for free content.

Implementing new rules

This empirical study makes it clear that the absence of rules has overwhelmingly benefited intermediaries. (This would also explain the market caps of a few of the biggest intermediaries.) And now, there remains a singular challenge: No individual publisher can change tactics unless all significant publishers move in lock step. That’s because individual companies would lose significant revenues moving on their own, even on behalf of consumers. Therefore, the bar must be raised equally, through a combination of tech and regulation.

Google is the most critical company with the most to lose and will have a seat at the head table no matter where the market or regulators take us. It will be critical for individual publishers to be able to move in the best interests of consumers and their fellow publishers without being held back by Google’s stronghold. Reuters reports that “Google has repeatedly said that it acts in the best interest of its users and offers sufficient warning to industry partners potentially affected by its moves.” We’ll see.

Recent experience suggests that Google will not cede ground. A friendly reminder that when GDPR rolled out last May in order to better protect the privacy interests of EU citizens, Google waited until the final days to push through its own interests. Global publishers had to send a formal letter of concern to Google’s CEO. They also filed a copy with every major competition authority in the western world.

Built on a shaky foundation

Much of the digital advertising marketplace and Google’s business have been built on direct-response advertising in which clicks and audience targeting are valued more than the media that surrounds it. This presents a challenge for media companies which have invested heavily in high-quality, premium news, and entertainment environments. Unfortunately, the largest part of the digital advertising market was whittled down to little more than an efficient delivery vehicle for cookies auctioned off to the highest bidders. And little has been done to dismantle this poorly-built foundation. Rather, our entire industry – data brokers, ad tech platforms, agencies and publishers have fueled these direct-response metrics by doubling down on them through behaviorally-targeted advertising.

The premise? That the new capabilities to collect and use browsing data across the web eliminate the waste in advertising, giving marketers their long-sought dream of one-to-one targeting with real-time measurement and publishers a share in the spoils to help fund their digital growth. And, through these same data reservoirs, advertisers could focus on cherry-picking consumers as efficiently as possible. This spawned a slew of sites optimized not for long-term relationships with loyal audiences but instead for their ability to create diverse cookie pools for these real-time markets.

The 800lb gorilla

Google was a company built for the direct response economy post-2009. Due to several years of belt tightening after the 2008 financial crisis, chief financial officers had more pressure to ensure that marketing investments met the quarterly demands of shareholders. And boy did Google deliver. Google did everything it could to maximize the personal data in its coffers and to minimize friction for advertisers who wanted to micro-target people based on it.

Some history:

  • When web browsers were on the cusp of consumer privacy innovation by restricting tracking cookies, Google lobbyists hindered industry progress.  At the same time their own browser, Chrome, took a dominant seat in the market.
  • When consumer ad blockers became a risk to Google’s data collection, Google began a series of secretive deals and payments in order to whitelist their own data collection tags and later commandeer a browser solution to protect its own ad formats. This saved the company billions in revenue while everyone in industry took a hit.
  • When a more privacy-focused mobile environment emerged from Apple, Google continued investing in its privacy-porous Android device. It earned a $5.1 billion fine for its efforts. Google also launched its own code layer in AMP. This provided the company deeper influence on what can be on publishers’ websites.
  • Google wrestled control and influence over the ad tech supply chain used by competing publishers through a series of targeted acquisitions.

Market dominance

The fruit of its labors is an advertising market optimized for its own interests.

  • Who conducts the most bids to buy advertising in these real-time markets? Google.
  • Who offers up the most bid requests to sell advertising in these real-time auctions? Google.
  • Who operates the most negotiations between buyer and seller? Google.
  • What is the most valued asset in digital advertising? Personal data.
  • Who owns the most personal data? Google.

Put another way. Google is the largest buyer, seller, and transaction vehicle for digital ads that leverage personal data. And Google has by far the most personal data. At this point, it should hardly be a question whether this is a rigged market.

The numbers are startling. In the past decade, Google’s SEC filings show that the advertising revenues Google delivers across its vast network of millions of publishers have barely doubled, having grown from $9 billion in 2010 to $20 billion last year. However, in the same ten years, Google has quadrupled its owned and operated advertising revenues from $28 billion to a whopping $116 billion last year.

Search was (and is) the monopoly that privileges entry into any other business by Google. However, the rich interest profile that can be assembled by harvesting personal data across its operating system, browser, ad services, analytics, and its own properties comprises a behavioral advertising fortress.

The anticipated Department of Justice decision to investigate Google is the company’s worst nightmare in terms of timing on these issues. Already we’re seeing influencers and former competitors begin to open up about bad conduct in Mountain View. Inevitably, there will be more details and more reports. It’s critical to the process—and the future of digital media—that light be shone on their activities.  

Without a doubt, the investigation means that Google will have a harder time finding friends in the publisher and ad tech communities. However, it’s unlikely you’ll hear publicly from many of them. And therein lies the ultimate symptom of antitrust: No company wants to cross Google. But the word “frenemy” will cut in a different direction now: You won’t find anyone watching your back when you’re under the regulatory microscope.

The rise of ad tech intermediaries

All of this said, Google wasn’t alone in its attempts to reap the spoils of the behavioral advertising marketplace. In the period between 2010 and 2016, hundreds (if not thousands) of new companies spawned in the ad tech wild west. By my count, there were 78 ad tech companies starting with the letter “A” in 2016 and today 64 of the 78 have either been acquired or disappeared from the industry. History will determine whether most (if any) of these companies had a lasting impact on the industry.

The core proposition of nearly all of them was to serve a burgeoning programmatic marketplace in which third parties could be inserted into the supply chain in return for value. The typical webpage went from dozens of third parties to hundreds. This triggered a real-time competition for eyeballs, most often represented by third-party cookies.

Personal data was collected by these third parties without consumer knowledge or control. The data was then used to target consumers across the web, as cheaply as possible. All of this was done outside of consumer expectations which led to the “adtechlash” with the rise of ad blockers, various levels of tracking protection launched into Chrome’s “competition” web browsers Safari, Brave and Firefox, and new privacy laws like 2018’s GDPR and CCPA rolling out in 2020.

Now we find ourselves on the eve of new laws globally to better align with consumer expectations. Publishers need to be fierce defenders of these consumers and protecting their experiences. Ultimately, the fight to defend behavioral advertising likely isn’t worth it. At the very least, every publisher and their representative organizations should make certain whose interests they’re fighting for. This will determine who benefits over the next ten years.

Industry-Research | Perspectives

Chartbeat spent more than 400 hours analyzing subscriptions—here’s what we’ve found

Chartbeat has immersed itself in research around reader revenue and subscription models this year. This work has taken various forms including data analysis, comparing historical trends, and distilling insights from past use cases. However, we’ve found that the best way to create actionable reader revenue solutions has been going to the source—publishers.

In the last month, as part of our work to go from publisher revenue pain point to solution, we spent time with users across all sorts of roles. These include editorial, consumer marketing, audience development and membership management, data science and analytics, events marketing, user research, and product management, all as part of our work to go from publisher revenue pain point to solution.

After more than 400 hours of subscriptions research, here are some of our early takeaways:

Current infrastructure doesn’t match paid model ambitions

We have found that the infrastructure for user segmentation is critical for publishers to effectively market their offers and content. Yet time and again, we’ve witnessed a core infrastructure built on growing advertising revenue. In this case, the customer relationship is less important than the reach across platforms and sites. On top of that, this customer data is still tied up in legacy systems.

Therefore, modernization, consolidation, and centralization across systems is crucial for publishers. With one structure to rule them all, greater cross-team alignment can be achieved.

No need to change the channel

It’s no surprise that email is one of the most effective ways to engage consumers. Yet the publishing industry still lags other sectors such as retail in wider adoption.

The energy behind email’s return is that it remains the most cost efficient way to test conversion and retention strategies. There’s little risk and plenty of reward for readers to opt-in to newsletters and other distribution lists. That’s why those numbers could be in the tens of thousands. However, segmenting these email lists is often a manual data pull, and the content is often painstakingly curated.

To make experimentation productive, publishers need to take a page from retail marketing by taking advantage of automated services and creating dynamic lists that reflect its diverse audiences.

Get time (and sanity) back with better alignment

Industries throw the concept of “better alignment” around frequently, but its applications are often lacking in clarity. The result is fragmentation, which leads to conversions being tracked in different ways by each team in organizations. A centralized reporting system is key for everyone to understand the role they play in reader revenue. Then they can join together towards a common strategy.

Time is a scarce resource, so spending less of it on tracking and interpreting conversions for multiple stakeholders also means publishers can focus more time on improving their core products.

Be the master of your domains

Technology companies care about (and invest vast resources in) data collection. Publishers, in contrast, have not devoted a great deal of attention to how their data is managed, integrated, secured, and made available. Suffice to say, this points to a major gap in the industry’s data governance practices.

Consistent and understandable data is foundational to a successful business strategy. Data governance hasn’t always been a core competency of publishers. However, it directly influences their ability to quickly prioritize company-impacting decisions. Better data governance makes it faster and easier for publishers to synthesize and act upon trends.

Lean in to content strategy

Content attribution is disconnected from a publisher’s CMS and other internal tools in their system. Developing a content strategy for conversions (or retention) is dependent on editorial intuition plus an understanding of what the data is telling you. As publishers shore up their brands and continue to build products that appeal to consumer interests, content marketing attribution is the missing link for proving ROI.

The time is now to build out the right attribution model will support investments across both editorial and marketing. Publishers can rely on the same resources as marketers across retail and other industries, which have been growing in sophistication around mapping content strategy to ROI. Attribution is crucial to support (and justify) the additional resources that have been devoted to editorial and marketing teams.

Editorial, meet product

As we mentioned earlier, there’s been a notable shift among large publishers that no longer see editorial strategy and product strategy as two separate functions.

Product strategy is most successful when you can pull from multiple teams to build towards an outcome that actually serves the needs of end users. However, this requires a cultural change that many publishers are still navigating. There’s a push and pull at play—collaborative decision-making requires balance between competing business needs and existing revenue goals. We’ve seen this theme consistently throughout our research. Understandably so—culture change is a challenge for all kinds of organizations.

Subscriptions: What we’ve learned so far

Our early subscriptions research findings point to a familiar tie that binds cross-functional organizations and revenue goals: data. Whether we’re talking about attribution or strategy, the common thread is the data that informs the intuition that has guided publishers for decades.

Yes, publishers will continue to navigate the cultural evolution taking place in the industry, but a composite metric might be the missing link. Unite everyone in the organization to tackle their respective roles in reader revenue and support those goals with actionable data. There’s a better chance to see positive results, or at the very least, build upon the findings.

Perspectives

DCN’s must reads: week of May 23, 2019

Here are some of the best media stories our team has read so far this week:

Perspectives

Google Chrome cracks down on tracking cookies. But who should make the rules?

Google has joined the likes of Apple Safari and Mozilla Firefox on the privacy front by offering users of Chrome the chance to disable or remove third-party tracking cookies. Last week, the company announced three protections that will soon be coming to the world’s most widely used web browser:

  1. In order to access consumers, developers will be required to specify – with attributes – which cookies contain user tracking and cross-site capabilities.
  2. Chrome users will be able to access this information and delete all cookies without affecting those which are active on a single domain (e.g., login, settings, site preferences).
  3. The browser will “aggressively restrict” fingerprinting techniques used by websites to identify browsers without a tracking cookie, though Google is vague on what this entails.

In today’s environment, it shouldn’t come as a surprise that one of the biggest players in online advertising and data-tracking is coming down hard on third parties (even if they don’t have a stellar track record with tracking). Let’s take a critical look at this new direction, starting with the positives.

The good

In the past, measures to crack down on data privacy abuse have swung between ruthless and milquetoast. Safari’s Intelligent Tracking Protection (ITP) has been called “nuclear” [by pundits for crippling trackers right out of the box, a measure that users rarely bother to disarm.

As a cornerstone of the digital ecosystem, Google understands the importance of data tracking for online publishers, acknowledging on its blog that cookies “play an important part of the web experience today,” It went on to add:

“Blunt solutions that block all cookies can significantly degrade the simple web experience that you know today, while heuristic-based approaches—where the browser guesses at a cookie’s purpose—make the web unpredictable for developers.”

Chrome’s new privacy features differentiate themselves by providing, in outline, a standard for transparency that eliminates guesswork and ostensibly leaves users in charge of their web experience.

This approach is both more balanced and precise than the wide bat swung by some competitors. These approaches challenged publishers to take inventory of the cookies they drop, and to use them in a more responsible way.

But not everyone is convinced that Google should wield its power over the web this way.

The bad

With a natural vested interest in its own data-driven products and services, some wonder whether the new privacy standards will apply to Google itself. While the company insists that they will, its power to act otherwise points to a larger problem.

We have heard time and time again that “data is currency,” and that’s true. Organizations depend on it for every step of the business cycle, from lead acquisition to customer service. However, with customer bases collectively exceeding half the global population, tech giants like Google  and Facebook have as much data as they could possibly want.

Even assuming the best of intentions on their behalf, we still must ask: Should privacy standards be determined and enforced by the very organizations who stand to benefit the most from them?

The battle for control

The drive for more and more data has given rise to the advertising crisis as we know it today. In the face of invasive third-party trackers, malvertising, performance issues, data breaches and other privacy infringements, consumer trust is at an all-time low.

One thing is increasingly clear: The industry needs oversight, and many contenders have stepped up to fill the vacuum. From emerging legislation like GDPR and CCPA, to Google, Mozilla, and other browsers, publishers have no shortage of authorities trying to dictate their relationship with clients—both consumers and brands/advertisers.

Awash in downgraded content, poor segmentation, and privacy agreements galore, end users are the casualties of this struggle, and the battle for privacy governance has quickly become a case of too many chefs spoiling the pot.

So, here’s a thought: What if organizations were equipped to set their own rules? And instead of concentrating power in the hands of Silicon Valley giants, what if the relationship between businesses and advertisers could be self-governed?

A better way forward

Publishers and media organizations are on the cusp of winning the future of digital. With historical direct relationships with brands and ownership of coveted first-party data, there’s never been a better time to take control of the digital revenue channel. The first step to winning is knowing the parties that contribute to your supply chain and verifying compliance with publisher policies covering data, security, quality and performance.

In most cases, more than 90% of their code is third-party generated and the veil of mystery surrounding a third-party’s identity has been a significant obstacle to content moderation. If Google did one thing right with the new Chrome updates, it was forcing developers to identify the purpose and scope of their cookies to the end user.

As long as businesses can vet the partners executing on their platforms, vulnerable and abusive code can easily be censured, creating a better digital supply chain for users, ad exchanges and publishers alike.

In this future, Digital Vendor Risk Management (DVRM) can arm organizations with the information they need to govern their digital assets. With built-in regulatory compliance, DVRM not only identifies risks, but ensures that the proper response is taken in any jurisdiction.

The best solution for customers and the best solution for business always go hand in hand. Rather than bringing them under an iron fist, DVRM creates a sustainable digital ecosystem by empowering businesses to protect their customers while driving revenue.

About the Author

Chris Olson co-founded The Media Trust with a goal to transform the internet experience by creating better digital ecosystems to govern assets, connect partners and enable Digital Risk Management. Chris has more than 15 years of experience leading high tech and ad technology start-ups and managing international software development, product and sales teams. Prior to The Media Trust, Chris created an Internet-based transaction system to research, buy and sell media for TV, radio, cable, and online channels. He started his career managing equity and fixed income electronic trading desks for Salomon Brothers, Citibank and Commerzbank AG.

Marketing | Perspectives

Video advertising in on the rise. But it isn’t for everyone

It’s no secret that web-enabled video is booming. Driven by the combination of an increasingly sturdy infrastructure to support its delivery and the growing popularity of online streaming services like Netflix, Amazon Prime, and Hulu, consumers of all stripes are spending more time watching video on personal devices. So, advertising budgets are being adjusted accordingly, as brands seeks to take advantage of the shift in behavior and make online video a larger piece of their media mix strategy.

New research from Brightcove – Video Advertising Trends and Preferences – demonstrates many positive developments for online video promotions: solid through rates (~60%), modest error rates (~25%), and manageable blocking rates (~20%). Yet, for all of the positive momentum surrounding online video, I frequently find myself advising clients to tread carefully when it comes to embracing the tactic.

Here are the three key issues that are top-of-mind with marketers when it comes to video advertising, and how publishers can respond.

1. It’s Easy to Do Video Advertising Badly. To be sure, it’s never been easier to create videos. However, while the means of production is readily accessible for just the cost of an iPhone, the other requisite – and costly – inputs haven’t changed. Sophisticated videos still require a multifaceted team comprised of a copywriter, art director, talent (performer), editor, and post-production expert to create a quality asset. Any attempt at cutting corners typically results in a shoddy asset that has the potential to hurt a brand’s marketing efforts more than it helps. That’s not to say there are exceptions – there are, and they get a lot of attention. But they are just that: exceptions.

Implication for publishers: Due mainly to its price tag, but also because of the relative complexity required to do video well, the domain remains the purview of large companies with deep pockets and the means to create quality assets, either using internal resources or with the help of agencies. And that’s where publisher sales efforts should be focused. Otherwise, sales groups can find themselves spinning their wheels for months trying to woo small companies with tight budgets to pull the trigger on a video campaign, only then to have it stall or perhaps worse, and push something out to the marketplace that winds up being problematic. For publishers focused on building out their video advertising offerings, providing video production resources to brands can be a meaningful – and potentially game-changing – tactic.

2. Video Is The Champagne of Online Marketing Channels, But Most Companies Can Do Just Fine With The House Table Wine.
Video is a major attraction to both senior marketing managers and also non-marketing executives, and for good reason. Only over the past decade or two has video become a viable advertising option for the mainstream. For most of the second half of the 20th century, video advertising (with all of its barriers to entry) was almost exclusively the purview of household consumer brands like Coca-Cola, General Motors, and Nike.

The development of reliable wireless broadband and the emergence of platforms like YouTube and Instagram have changed all that, of course. And this has democratized video advertising. However, just because it’s available doesn’t necessarily make it a good fit. Indeed, for most small and mid-sized companies, alternative digital channels such as search and display offer more options by way of speed-to-market, testing, and optimization.

Implication for publishers: Though video can be used as a direct response tactic – think of all the late night infomercials and class-action-lawsuit-recruiting pitches – it’s most effective as a component of a multichannel, sustained campaign. In other words, it’s part of a solution, not the solution. In this kind of a use case, video reinforces messages and offers being delivered via complementary channels, both online and off. For years, I worked on acquisition campaigns for a big telecom company. We used video as an upper funnel tactic to establish awareness, and reaped the benefits later on in the lower funnel area of the customer journey. Publishers that can offer these multi-touch point solutions know how and when to add video to the media mix, and do so in a way that effectively sets expectations and creates a roadmap to success.

3. Many Brands Want to Jump Into Video Advertising With Both Feet, But Markets Need Education. Even experienced and savvy marketers are prone to miscalculating what’s required to manage campaigns that rely on video to be successful. First and foremost, budgets get out-of-whack right out of the gate, as ‘workable media’ metrics get wonky simply due to what’s required to create the video asset. That’s not the case with brands that have been running TV spots for decades, of course, but rather for companies trying to move upstream in the online advertising value chain.

Accustomed to an environment where advertising units can be churned out easily in hundreds or even thousands of variations – as is the case with search, display and even content marketing – the usual rules go out the window with video advertising. So the entire digital marketing methodology that most active online promoters have adopted, which is based on a plan-design-launch-analyze-repeat methodology, doesn’t really work with video advertising, nor does that last-touch attribution metric which we’re all, however sheepishly, still embracing.

Implication for publishers: Media companies are in a unique position to genuinely educate customers and prospects on how to do video advertising successfully. Taking a measured approach to pitching video ad solutions requires some discipline and might also result in leaving short term money on the table, but given all of the potential pitfalls, it’s preferable to the damage that could be done with either existing, long-term (and profitable) customer relationships or potential new ones. Given the relative newness of video advertising.

There’s no doubt about where video advertising is headed. Along with the voice/speech category, video is on an upward trajectory that will last for years. Everyone loves video: consumers, executives, B2C, B2B, domestic, and international audiences alike. There’s no better package for message delivery. And it’s why the entertainment industry (using TV and movies as its backbone) remains just about as relevant today as it’s ever been, even in the wake of the internet revolution that was supposed to decimate the category. However, just as it’s difficult to make a quality, differentiated TV show or movie, so is the case with online video advertising. It’s part art and part science, and requires a ‘secret sauce’ to be effective. Brands will be well-deserved by wading carefully and deliberately into this space, and savvy publishers that serve as their guides will be rewarded as well.

About the Author

Tim Bourgeois is a digital media consultant that helps brands optimize ROI on advertising, technology and agency investments. Connect with him on LinkedIn.

Featured Post | Perspectives | Policy

What policy makers can learn from privacy-focused products

The legal and policy community continues to debate the impact of General Data Protection Regulation (GDPR), the ins and outs of the California Consumer Privacy Act (CCPA), and how (or whether) Washington should regulate consumer privacy. While the debate rages on, we are seeing a stream of consumer-focused privacy-oriented product rollouts. It is interesting to look at what these controls actually do and how they might inform the policy debate.

In a concession to consumer privacy, Google recently announced that it would allow consumers to block companies from tracking them across the web when they are using Chrome. Specifically, they will differentiate between 1st party and 3rd party cookies. As such, they will allow consumers to delete 3rd party cookies while preserving the 1st party cookie, which, for example, allows a website to remember a consumer’s log-in information. In addition, Google will soon roll out features to prevent companies from identifying consumers via device fingerprinting, another method used to track consumers across the web.

Let’s be clear, Google is late to the privacy game given the long history of privacy protections offered by Apple and Mozilla. Apple has famously blocked 3rd party cookies by default in Safari and recently introduced Intelligent Tracking Prevention (ITP), restricting the ability of companies to access cookies when a consumer is not interacting with that company.  

Services that care for consumers

When a consumer visits YouTube on Safari, Google can access the cookies they have set on their browser. However, as soon as the consumer navigates to another website, Google can no longer access those cookies. ITP essentially breaks the ability to track consumers around the web.  Apple has also worked to block loopholes where cookies, set by companies like Google and Facebook, pretend to be 1st party but are then used for tracking and secondary use. Unfortunately, it is hard to muster much confidence that Google will be anywhere as diligent as Apple in closing loopholes, given its business model is built on its ability to expertly track consumers.

Mozilla, on the other hand, offers multiple ways for consumers to block third party tracking in Firefox. Mozilla is also considering rolling out a “Super Private Browsing” mode, which would incorporate Tor privacy features into Firefox.

Beyond the most commonly used browsers, a whole suite of new services have popped up. Duck Duck Go, a search engine, and Brave, a browser, offer strong privacy controls as their primary value proposition. As we’ve noted for several years now, more and more consumers are turning to ad blockers to protect themselves and/or improve their web experience. Forcing these massive platforms to once again compete on privacy will be good for everyone, particularly consumers. The question, of course, is whether some of these companies are simply too big to change at this point.

Policy implications

Back to my original question: What can policymakers learn from these new consumer privacy controls?

For starters, consumers increasingly demand more and stronger protections of their data and digital lives or the market wouldn’t be headed that direction. You can reasonably debate whether Google’s recent announcement went far enough. But the fact that a multi-billion-dollar company like Google did anything at all speaks volumes.

It’s also worth pointing out that all of these new controls, which curtail the ability of companies to collect consumer data at scale, are not actually breaking the internet despite the frequent claims of ad tech lobbyists. In fact, given this push to meet consumer demand for greater privacy controls, it’s funny and a little sad to look back at the hysteria from some of these lobbyists.

Meeting consumer demand

The big takeaway is how these companies and their engineers are designing services and features to meet consumer expectations for privacy. This new wave of privacy controls gives consumers the ability to stop companies from tracking them across the web. Yet, these services preserve the ability for websites and apps to collect and use consumer data when the consumer is interacting directly with that company.

This approach makes sense. Consumers share their data so that companies can use it to provide a service or content. In this fair value exchange, the consumer can choose to engage or not. Consumers do not expect companies to track them outside of that fair value exchange and doing so is simply bad business.  

It isn’t a question of whether consumers want their privacy protected, these market moves demonstrate the demand and inevitability. And, as policymakers consider how best to craft consumer privacy protections, it’s worth noting how today’s best engineers have attempted to meet consumer demand and expectations for privacy.

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