Fraud

Local Food.

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Leave it to Mike Shields of Business Insider for taking a position and calling out marketers and agencies for the faux shock they are expressing on issues of fraud and supply chain corruption.  Not since Tom Phillips of Dstillery famously evoked HBO’s “The Wire” has culpability been served in such substantial portions.

I’m sure that many in our industry will have nits to pick with Mike – honest people can disagree.  But come on people!  At very least, the optics are terrible.  Marketers publicly crying foul, agencies and tech companies pointing fingers at one another… it’s enough to give one the vapors!

As my small contribution to the debate, I’m offering a new way to look at the issues of quality, transparency, viewabilty, etc.  Set aside all the tech speak and financial-bubble metaphors:  the discussion is really about the quality of the internet food supply.  Welcome to the concept of local food!

The Drift is proudly underwritten this week by Digital Remedy, a digital marketing and technology solutions partner to publishers, advertisers, and influencers. Digital Remedy delivers performance-based and cross-channel solutions to increase monetization and operations potential of any organization while exceeding standard KPIs. Visit Digital Remedy to learn more.

Rather than continually backpedaling on issues like the percentage of viewable impressions and acceptable fraud levels, might we instead start to compete on the basis of quality – on how much we do know about the inventory we serve?  Might we now start talking about the exact source of inventory – where it was born – and exactly what hands its passed through on its way to market?  No shady rail depots or slaughterhouses.  No grain silos tainted by GMOs or banned pesticides.  I know the where all of my impressions came from and you are getting the cleanest shipment imaginable – USDA prime!

Think this is all a bit much?  Or perhaps that I’ve gotten soft in the head from living in a farm state – Vermont – all these years?  Maybe you’re right.  But consider for a minute the plight of the small publisher who’s struggling to get fair compensation for high quality inventory?  Is she really all that different from the organic farmer who’s now able to charge a premium for a purer, cleaner product?  Or think about the volume publisher or platform operating in a bottomless pool of inventory:  Isn’t he a bit like the big packaged goods company trying to drive up the price of commodity staples by appending organic, gluten-free or non-GMO to every possible product?

Maybe it’s not as simple as asking the advertiser do you know exactly how that got on your plate?  But maybe it’s not such a bad way to start the conversation.

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The Scourge of Abundance.

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The Scourge of AbundanceThis week I’d like to double down on a theme I raised last month: ad blocking. (“Another Pox on Our House!”) It’s not that it’s a particularly new topic, or that I get some perverse kick out of piling on. It’s just the latest symptom of an affliction that’s plagued online marketing for years: the Scourge of Abundance.

Who remembers brand safety? It seems we were talking about that particular ailment just a few months ago. But since then we’ve seen outbreaks of non-viewability, fraud and now – like the comeback of a retro disease like scurvy or consumption – the resurgence of ad blocking software.

This week’s Drift is underwritten by Krux, which helps marketers and publishers worldwide deliver more personal, more valuable advertising, content, and commerce experiences, improving revenue performance and deepening engagement across all consumer touchpoints. Clients include companies like Kellogg, Time Warner, Meredith, BBC and Ticketmaster, with enterprises achieving 10x return or higher on their investment. Visit krux.com to learn more. 

What these all have in common is that they stem from a business that’s been built on a set of faulty premises: the proposition that more ads are always better; the idea that we should be maximizing the fill rate of all available ‘inventory;’ and that somehow our fortunes are to be mined from a future where our already-unimaginable supply of ads gets even bigger. Even McDonald’s has stopped focusing on the “billions and billions” of hamburgers served over the years, talking instead about the unique experience you may have with one of their products or restaurants.

We digerati love to carp about how television is getting more than its ‘fair share’ of ad spending (as though ‘fairness’ were even relevant, but that’s another post). But one thing TV has been really good at is establishing and managing scarcity. On one level – available inventory – it’s a much smaller business than ours; on another – advertiser investment – it’s still a behemoth.

I think even the dead-enders among us realize now that “more ads” is not the answer. Instead, we need to identify those things in that are scarce – a ridiculously valuable audience segment, a unique brand experience, a smart integration – and work backward from those points of value.   We’ve had 20 years of doing less and less with more and more:   It might be time to start doing more with less.

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Programmatic: All Grown Up Now?

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Programmatic All Grown Up NowIf it’s all the same to you, I suggest we agree to write off the first five years of the programmatic era.   I mean, let’s face it:  these first few years haven’t been all that flattering.  It’s been a half-decade of adolescent excess, exaggerated fame, reckless experimentation and more than a little danger.  Who knew the B in RTB stood for “Bieber?”

Before all my Prog friends start hating, let me say what I’ve said all along:  Programmatic is not a phase and it’s not optional; it’s absolutely a hard trend that will reshape the entire business of marketing.  That it’s so fundamental and serious is all the more reason we’ll look back on these early years the way we look back at 80s haircuts and the contents of our old mixtapes.

This week’s Drift is proudly underwritten by Bionic Advertising Systems, an advertising technology company focused on delivering innovative software that streamlines and automates media workflow for marketers, their advertising agencies, and publishers.

When Programmatic first came on the scene, we went through a period of wild, unmitigated excitement… even though most of us couldn’t fully understand what we were so excited about.  All we knew was that anybody who could spell “RTB” got a spot on the LUMAscape and a pot of gold at the end of the journey. Call this period “RTBieberFever.”

After elation there is always backlash.  And so there was.   The technology and business was harder than we’d been led to believe, the revenues more sluggish and unpredictable.  We all learned to say “Programmatic is about more than RTB” but most of us weren’t really sure what to say next….beyond blurting out song titles like “private exchange” and “programmatic direct.”

Finally, of course, there was trouble with the law.  The exchanges became our own version of Dade County, filled with non-viewable and fraudulent impressions and – no doubt –sketchy guys on broadband houseboats jobbing the system.  Suddenly Programmatic was on trial in the media.

But I’m happy to say the story has a happy, if decidedly more boring, ending.  While technically complex, Programmatic was always a very simple idea at heart:  If you just agree that (1) two terminals will ultimately make an electronic trade of inventory for dollars and that (2) the decision to buy (and/or which creative to place) will be influenced by first or third party data, then congratulations…you’ve just defined Programmatic.  Everything else was about specific strategies, tactics and channels.  And that’s where the grownups come in.

Last week’s announcement that Group M will no longer buy on open exchanges — choosing instead to pursue private exchange relationships with publishers – is just the latest sign that Programmatic is settling in and becoming part of the background music.  In the three to five years ahead, I predict that Programmatic specialists on both sides of the table will fade away; that more than 90% of all online ad transactions will be executed programmatically;  that programmatic trading and buying will become vastly de-centralized; and that the word Programmatic itself will fall out of use.

It won’t be as exciting as RTBieberFever, but it will end up being a whole lot more important.

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Six Questions: Gian Fulgoni

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Six Questions Gian FulgoniGian Fulgoni, Co-Founder and Chairman Emeritus of comScore, has spent 40 years measuring and analyzing the use of digital devices and the consumption of digital content.  He’ll be our featured keynote interview at The Upstream Seller Forum on June 24th in New York.  This is an edited email interview;  for the complete, unedited transcript, go here.

1. For better or worse, ComScore has been closely identified over the past 20 years with the measurement and verification of web traffic and audiences.   As the herd moves to mobile devices and addressable TV, how much does that challenge your position?

Slightly more than 50% of consumer time online today is spent using a smartphone or tablet. Interestingly, however, there’s no evidence that time spent on desktops has declined — just its share of time. It’s not a zero sum game. It’s now clear that the more Internet-enabled devices someone has, the more time they spend online.

Beyond just digital, we are also now able to measure across traditional media platforms, including TV and radio…something that ESPN first asked us to solve more than two years ago. The system is now in the process of being syndicated beyond ESPN and we have high hopes for its potential.

This week’s Drift is proudly underwritten by Bionic Advertising Systems, an advertising technology company focused on delivering innovative software that streamlines and automates media workflow for marketers, their advertising agencies, and publishers.

2. I’ve heard it said that your VCE tools (and Nielsen’s competitive OCR standard) are leading us toward a multi-device GRP.  That’s too simplistic, isn’t it?

comScore is intent on providing multi-device GRP measurement. In fact, we do that today…But there’s another dimension to the GRP that I think is critical and which we also provide. One can’t just measure the audience for each device in a silo. One needs to know the unduplicated audience across every combination of devices at the content level. And build this knowledge into the GRP metric.

3.  ComScore lit up the IAB Annual meeting a couple of years ago with a call to arms about viewability.  What’s improved since then, if anything?

(Because early) viewability metrics focused on the media buyers, it initially put media sellers at a disadvantage in negotiations…So we responded to the need from the sell-side for viewability tools to assist in optimizing inventory (which) has helped re-establish a basis on which buyers and sellers can both derive the benefits of optimizing around viewable inventory…Today, I think that viewability is on its way to becoming accepted as a key metric that can help put digital on an equal footing with TV.

4. Programmatic, exchange-based ad trading has been with us for close to five years now.  Are you impressed yet?

I’m very impressed by the ability of programmatic to lower transaction cost…but it also comes with some of its own challenges…(A) big issue with the exchanges…is the prevalence of non-human traffic . We’ve seen the in-view rates for ad impressions be much lower on the exchanges than on the premium sites, with a large proportion of that being caused by ads being delivered to bots not people. The answer there might be for the buyers on the exchanges to insist on minimum viewability rates.

5. The biggest existential threat to a healthy digital ad ecosystem is….what?

I think the actions of legislators could have an unanticipated collateral chill on the industry. 

6. Tell us something that brings perspective and clarity to this crazy, seat-of-the-pants digital media world.

Ted McConnell at P&G once said: “We need to understand the truths that transcend change.” I think that’s a great point in today’s dynamic digital media world. When all is said and done, we’re still trying to communicate with consumers so as to build and enhance brands. Yes, digital provides us with many new media capabilities, but in addition I think we need to remember the marketing lessons of yesteryear that still apply today.

To reserve one of the final spots at The Seller Forum, contact us today.

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Flash Nerds.

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Flash NerdsMichael Lewis’s new book “Flash Boys: A Wall Street Revolt” tells the true (and, unfortunately, legal) story of Wall Street technology companies who discovered ways to see demand milliseconds before others and successfully job the system.  These companies would pay for physical access and proximity to the powerful financial exchanges where they would await incoming orders, read them, buy ahead of the unwitting customer and resell the shares at a profit.  The exchanges, the banks, the brokers and everyone else in the system either didn’t know what was happening or willfully turned a blind eye:  after all, the system was working and making everyone a lot of money.  The only losers were those who couldn’t be seen; the consumers and pension funds whose portfolios were less valuable because of this hidden tax.

As Mark Twain said, “History doesn’t repeat itself.  But it does rhyme.”

This week’s Drift is proudly underwritten by Bionic Advertising Systems, an advertising technology company focused on delivering innovative software that streamlines and automates media workflow for marketers, their advertising agencies, and publishers.

The online advertising business is going through its own version of the same saga.  For every display ad that can’t be seen, every video that auto-plays when it wasn’t supposed to, every fraudulent ad call that leaks into the system from the hackers den in Eastern Europe or the houseboat anchored off Boca, our credibility and forward progress take a hit.  And don’t think these issues are confined to the pages of insider industry websites and the stages and breakout rooms of ad tech conferences.  Just last Saturday The New York Times published “The Great Unwatched,” which served up the issue with healthy doses of outrage and shock.

“Flash Boys” features both villains and an underdog band of heroes who expose the problem and create a new era of transparency and an emerging standard for how trading is supposed to work.  So far, we seem content to chalk our “Flash Nerds” problems to a murky cabal of distant ne’er-do-wells.  In The New York Times article it was noted that TubeMogul “…reported that it had discovered three new botnets that were generating 30 million fake video views a day, earning as much as $10 million a month. TubeMogul said the culprits were well concealed and likely operating overseas.”  It’s convenient and a little exotic to once again blame it on Moscow, but it’s also disingenuous.

Edmund Burke once wrote, “All that is necessary for the triumph of evil is that good men do nothing.”  I’m not completely comfortable couching this issue in the language of good and evil, even though there is in fact a good deal of stealing going on.  But I do think there are far too many good men and women doing nothing.  A robust level of demand has brought on good times for an intricate, overlapping system of middlemen and technocrats; a ton of pressure is put on buyers and sellers to “just get the deals done.”  Yes, I know it’s all so much more technically complicated than this, but please don’t tell me that it’s so screwed up that a given company or CEO can’t say “We will always behave this way” or “We will never do that.”

Soon, I hope, there will be white hats and black hats passed out.  Whether you’re identified as a hero or a villain may be less about your overt actions and more about what you are willing to accept.

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