The speed of change in digital media has bred a magpie-like obsession with what’s new and shiny. And that’s been to the detriment of holding platforms to account, whether it be for effectiveness, measurement or ad serving.
That’s the view of a digital advertising veteran we interviewed for the latest edition of our Confessions series, in which we grant anonymity in exchange for candor. This ad exec has spent time on all sides of the industry: client, media owner, tech and agency, and shared frustrations of why the industry is in such a mess, and how agencies are over-reliant on rebates.
Excerpts lightly edited for clarity.
What irks you most about the current status quo in digital advertising?
The lack of interrogation people have with platforms. People just don’t apply good principles to anything. If it’s new, it’s fine, it’s fun. We should use it, despite the fact it’s unproven. Take Snapchat: People jump in it regardless of whether it has proved itself as an advertising platform, but clients want it because it’s new, so do agencies to keep clients happy, so do journalists, and investors. That’s all well and good, but we need to ensure these platforms are robust before we jump on them.
The logic being Snapchat users are the next-gen spenders.
Snapchat’s core audience isn’t the biggest in terms of disposable income. But the ad industry has an obsession with youth. It’s all newness for newness sake.
What are the ramifications of this lack of interrogation?
It’s what has got us into the mess we’re in now. We haven’t put rigor into our approaches to the platforms we use. There is no third-party verification on anything on Facebook. No other media platform that size would be allowed to have that. For the sake of the “new” people throw out basic principles. So platforms don’t have to conform to traditional values, whether it be measurement, accountability, ad serving or anything.
Meaning Google and Facebook.
I wouldn’t put Google in that actually because they are better than most. This YouTube thing is bit of a distraction. It’s not to say they don’t have a YouTube problem — they do — but YouTube isn’t typical of the rest of Google. General display advertising is where the real problem is, because that’s where there can be all the daisy chains of interactions and all the middle men taking a percentage, and no one is sure why.
That’s hard for publishers and clients.
Yes, clients tell me they don’t know what to ask. It has all got very complex from a technology perspective and a money one, as in who takes what, where and when. And some agencies are taking the view that they will only answer the questions they’re asked. That’s disingenuous. But that’s like going to a doctor and asking specifically if you have a certain illness. And they’ll reply no but not explain what else you may have.
What were your biggest frustrations when you were agency side?
People basing media planning according to where they get the best rebates, rather than what’s best for the client. The hardest thing was telling clients they had to be on certain platforms when really it was purely just for financial benefits for the agency. Is that better for clients? Probably not.
How would that play out?
Some old-style portals, for example, maintained market share way beyond the lifetime of their businesses in some ways, because they offered very good rebates. So, you could agree with a media partner to spend, for example, £10 million [$12.5 million] a year, and they give you a rebate of £500,000 [$625,000]. The following year you may know those aren’t the ideal platforms for the clients, but you have to find a place where you can spend £10 million and get the same rebate, which could mean having to use more suppliers and be more work. If that same company offers you £600,000 [$750,000] for £11 million [$14 million] a year, you’re going to take it. Because it’s easier, regardless of whether that’s the right thing for clients.
So what keeps you in this industry?
Markets will always adjust themselves in the right way eventually. We just need to put more value back on the strategy rather than leaning so much on the trading. The media strategy should be more important than the trading terms. The industry just needs reminding of its responsibility.