Transparency in Media Buying and Programmatic Marketing

In our latest piece from the IAB’s Display Trading Council, Berit Block, marketing director for Europe at DataXu, sheds light on the meaning of ‘transparency’ in media buying and programmatic marketing.

While researching for this piece, I was reminded just how many meanings one term can have to different people. To most consumers, ‘transparency’ in advertising means being made aware of what data is being collected, by whom, and how companies intend to use it. Often this is related to cookies. The youronlinechoices initiative is a great start when it comes to explaining behavioural advertising to consumers, especially with recent news about increased use of ad blockers. Education and transparency are both deeply involved in winning (back) consumer trust.

Transparency is also necessary on the buy and sell side when it comes to programmatic marketing across all channels – from display, mobile and video, to social media.

As with any relationship in life – if you want partnerships to prosper and flourish, you need to be honest. And no matter if you apply this principle to personal matters or relationships with agencies and technology companies– it is the foundation for a long-lasting, successful partnership. I feel very strongly about honesty and transparency and I don’t think it’s possible to claim that a business operates transparently unless it does so in absolutely every area of that business.

Programmatic marketing, and the media and ad technology companies that enable it, offers a number of value propositions to marketers: cost efficiencies, operational scale, a consolidated view of customer touch points and increased transparency. While most of these benefits are self-explanatory, ‘transparency’ has become quite the malleable term of late.

The IAB US states in a recent whitepaper about transparency: “To scale the market and create value for all, the digital advertising industry must ensure increased transparency in the programmatic auction ecosystem – over fees, net CPMs and the bidding process itself.”

In order to demystify the marketplace confusion around transparency once and for all, I’ve broken the topic down into four distinct areas: media, tactics, management, and price.

When it comes to tactics, clients deserve full visibility into campaign set-up and how budgets are divided by tactic — as well as how unique tactics (e.g. retargeting versus prospecting) are performing. This is the only way to learn more about which campaigns are working—and what to do more of in the future.

When it comes to media transparency, clients retain the right to ask partners for site-level reports that include impression volumes, clicks and action counts. Media or ad tech vendors who refuse to provide this most likely have something to hide.

Management transparency is crucial to ensuring campaigns are managed according to the original client brief. Most (if not all) programmatic partners have a proprietary interface that they can and should be able to export monthly reports and screenshots from to validate all campaign actions being taken.

Finally, price is perhaps the most crucial piece of the transparency puzzle. A 2014 ANA/Forrester survey entitled ‘Media Buying’s Evolution Challenges Marketers’ revealed that two of marketers’ top five concerns regarding media transparency center on price. “Uncertainty of agency profits from media buys” ranks as their second biggest concern, while “agencies arbitraging inventory purchase/sales” ranks fifth.

Clients should have visibility into the price of media and be able to see what technology or agency fee has been charged in addition to the cost of the inventory. I have heard the argument before that if good results are achieved it doesn’t actually matter how much margin was charged. I think everyone in the chain should disclose their margins. Being transparent about everything, and not only self-selected areas, will ultimately lead to more trust between advertisers, publishers, and technology partners.

The technical nature of programmatic trading is not inexorably linked to obscurity. Many SSPs act ethically, but some bad apples abuse the lack of control associated with real time bidding and, therefore, the degree of transparency offered in the deal. These may include blackboxing, artificial floor pricing, abnormal price fluctuations, or any degree of manipulation between the bid and the clearing price. Transparency, therefore, can be a deciding factor for buyers when choosing which supply-side platform’s inventory to bid for. For example, Sociomantic’s supplier quality index makes a real-time assessment against factors of transparency, inventory quality, and performance at the point at which the bid is made in order to ensure an advertiser’s budget is being spent transparently.

Transparency may mean many different things to different people or organisations, but regardless of how the term is translated into business, it remains an underlying value that helps to address issues such as brand safety and fraud, among other hot industry topics.

Advertisers turn to programmatic because it offers a way to address precisely-defined audiences in a personalised way, yet with unrivalled reach and scale. But in automated transactions – just as with manual ones – there remains the need to be transparent by ensuring that those on the buy-side have a clear view of where and how their budgets are being spent.

For the opportunity to hear more on the subject of transparency and to air your views please join us at the IAB for our Transparency debate on October 17th – full details are available here

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Lars M. B. Anthonisen is Global Account Lead @ Google. Previously, he held various digital marketing positions at media companies across Europe and Asia including Regional Digital Director at MediaCom APAC, CMO at Adform and Digital Manager at Universal McCann Worldwide.

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