The Guy Under the House.
Many homeowners share the experience – or the fear – of the guy under the house. He may be that exterminator who emerges from that dark crawly place under your fixer-upper and says “I’ve got bad news…worst case of termites I’ve seen in a long time.” Or he could be the contractor who rips down the sheetrock from a single wall and solemnly utters the two words you dread most: “Mold. Everywhere.” These moments with “The Guy” are so terrifying because they deal with an attack on the very foundations of the place we live.
Internet advertising – at least that part of it that relies on highly networked or exchange-based long tail impressions – may be having its own visit from “The Guy” just about now. The issue is “viewability.” And if some of the current estimates of the problem are true, we may just need to take this place down to the studs in order to get rid of it.
The Drift is proudly underwritten this week by PubMatic, which helps premium publishers take control by giving them a real-time media selling platform for managing revenue and brand strategy.
For those unfamiliar with the concepts behind “viewability,” the story line goes something like this: Once we move beyond the tightly controlled world of structured media and vertical websites – out onto the long tail where all sorts of bulk audience buying and retargeting are taking place – things get dark and crawly. For lots of reasons – ranging from ads appearing “below the scroll” to rogue players jobbing the system by “stacking frames” of ads on top of one another so that a huge portion are never even technically viewable –big numbers of ads never even come into the view of consumers. How many? I’ve heard estimates that 30-40 percent of today’s available exchange impressions can’t be seen. I’ve also heard it said by other sources that that number can range into the mid-90s. Do I believe either of these numbers specifically? I have no idea. But do I believe that there is some number of non-viewable impressions in the water supply? Yes I do, and I think it’s probably substantial. But then I think any number beyond a trivial rounding error is too big.
Anything that calls into question the integrity of the basic inventory supply can’t be good. It hands one more weapon to those who’d like to slow the pace of change and the growth of the online marketing channel. We’ve been through this many times in the past: bogus website user counts because of search engine spiders and robots….ads landing on questionable content pages…..discrepancies in syndicated research…..just one thing after another. I have no doubt we’ll get this fixed and put the whole thing behind us, provided two things don’t happen:
- First, we can’t afford to deny the problem or waste time defending the undefendable. If we’re selling stuff that has no possibility of being seen then we have to fix it. Hard stop.
- Second, if a dozen different standards emerge for measuring the problem, followed by 6 dozen mutually exclusive ‘solutions,’ that will be a recipe for disaster. We can’t let this issue spawn an opportunistic tower of babel. If we do, the problem will simply linger and fester.
Some percentage of ad impressions is not in view. But the problem that creates clearly is. Time to move on it.
Ahmen!
[…] Upstream Group’s Doug Weaver takes on the topic of the "viewable impression” on his company’s blog. He’s a skeptic and writes, "Anything that calls into question the integrity of the basic inventory supply can’t be good. It hands one more weapon to those who’d like to slow the pace of change and the growth of the online marketing channel. We’ve been through this many times in the past.” Read his proposal. […]
Here, here. Nice timing as always, Doug, since as you know we’re discussing this topic in an afternoon session of the IAB Ad Tech conference today in NY (heck, you’re probably leading one of the breakout sessions). Time for us to come up with one standard of measuring the % by property & set a field for every impression coming through exchanges, get it set across the supply ecosystem, and give all buyers the same view to drop bids/entire sites that do this. Need to hear of course from the Exchanges/SSPs, but either we do it thru the IAB or the best supply source that has this already recognized as a variable from their publishers gets to claim they had it first and everyone else rally around it, so it’s just the way business gets done going forward.
Doug, this is kind of like being the boy who has the guts to say that the emperor has no clothes but, in this case, it turns out that nobody actually cares that he is naked – especially the emperor.
The real buyers of this inventory already know this is crap and they are not motivated to change. They are incentivized to to push even harder. Here’s what I see:
Most ads that can’t be seen are sold on a CPC basis or on a CPM basis that is so cheap the buyer has to know something is wrong. Unethical ad networks are able to generate clicks on ads that are more or less invisible.
If you have looked closely at many of the automated buying services, what you find is that the biggest driver of lower CPC as an output is a lower CPM as the input. Cheaper impressions, not smarter impressions are the real drivers of this slice of our industry.
(There are elite, blue chip behavioral targeting solutions for sure. These solutions struggle because they don’t win on CPC or CPM and many marketers are overwhelmed and under-motivated to sort them out. It’s just easier to rank them by CPC.)
The bottom feeder ad networks tend to improve CPC over time because they get better at bidding on the exchanges for inventory that nobody wants. Invisible inventory is at the top of the list. To a degree, they do tend to optimize towards the tiny slice of the population that is super-heavy clickers but this optimization has nothing to do with better behavioral targeting that is specific to the brand/consumer model.
Some would say that they optimize towards “people” who click so heavily on ads that it is impossible that a real human being is on the other side of the IP address. But, they won’t say that for attribution because the buyers need this choice for some of their campaigns.
There are digital executives on the client side who are experts at the arcane buying tactics that lower CPC. These people often report to marketing executives who know nothing about this non-transparent part of the digital media industry and guess what? – they create incentive compensation packages for digital buyers so that they can earn bonus compensation if they beat CPC targets.
Every year, the bar gets higher (the CPC gets lower) if you are going to collect this bonus.
These executives never set out to behave unethically or to cheat their own company but nonetheless, they are highly motivated to use the least ethical ad networks because these networks know how to generate phantom clicks on ads that are essentially invisible. You need to slide a little more of the budget towards these solutions each year if you are going to lower your CPC every year.
You might be surprised how many marketers use online advertising as a core tool for direct response marketing but do not invest heavily in tracking the long term value of a click to their home page. A click is a visit and that’s that for many companies.
This is a race to the bottom that I’ve come to respect for its incredible ability to re-define the bottom every time I think that a hard landing is inevitable.