How will auction packages address some of mobile advertising’s big challenges?

As part of an ongoing series about the impact of auction packages by The Drum and PubMatic, we asked industry experts what this technology will do to help mobile advertising.

There has been a perception in the industry that mobile advertising is somewhat of a wild west - where has this misconception come from?

Dominic Barnard, head of programmatic, GroupM APAC: Considering the vast amount of mobile inventory, there are plenty of opportunities to interact with consumers in their intimate digital space. So much so that mobile ad spend reached $288bn globally in 2021. The scale of the mobile ecosystem, coupled with significant investment, means that inventory quality is paramount if we are to build trust with advertisers.

In previous years, the mobile ecosystem has struggled with consistent standards and quality formats. In addition, measurement and targeting have experienced unique challenges given that approaches such as cookies historically have limited use on mobile devices due to frequent cache clearing.

In the past, these factors have sometimes led to questionable mobile app/site-lists being bid on if buyers have set loose targeting parameters on the open marketplace. However, mounting consumer privacy concerns and advertisers’ desire for improved quality have resulted in significant improvements in mobile advertising standards and methodologies over the last few years.

Lashanne Phang, senior director, mobile, PubMatic: The mobile ecosystem is fairly complex and fragmented. With thousands of in-app publishers surfacing every year, it’s hard to keep track and recognize which are the premium ones. Also, the history of fraud cases in mobile has contributed to a negative impression of the quality of mobile inventory. Having said that, all players in the industry are becoming more aware of the need for better transparency and control – resulting in the roll-out and adoption of IAB initiatives such as app.ads.txt and Supply Chain Object (SCO) to determine supply path, and ‘Open Measurement SDK’ to allow for better measurability.

Elaine Tan, head of sales, South East Asia, international business department - advertising, iQiyi: The mobile advertising industry faces several issues, including transparency, brand safety, and fraud. Advertisers need to gain good insights into the consumers who are engaging with their ads, and whether their investments are truly maximized.

Brand safety is also an issue, as ads could appear next to objectionable content which could erode the brand. The mere fact that their ad appears next to such a news story could cast them in a highly negative light that significantly damages their brand perception.

Ad fraud is perhaps the most significant mobile advertising problem. Advertisers are concerned with impression fraud, when ad impressions are falsely generated to inflate some impressions, causing advertisers to spend more money than they should. Advertisers also face the problem of click fraud.

Mobile is closer to individual users, has more functional permissions, and many derived application scenarios. Especially with the establishment of big data, the improvement of data application awareness has also allowed more industry players to see the value of data. Therefore, more unfavourable applications and acquisitions are derived. Coupled with the increasing data privacy protection topic of consumers, cookieless, user opt-out etc, have driven players in the identity field to invest in creating a universal ID circulation scheme that replaces IDFA and AAID. It is safe to say that we are still in the early days of a new era of mobile advertising, and there are many other variables that may have led to this perception.

How do solutions like auctions packages instil more trust in mobile?

Dominic Barnard, head of programmatic, GroupM APAC: Auction packages, which are essentially private marketplaces (PMPs) set up by the SSP according to pre-agreed parameters, can provide buyers with more control over the inventory they’re bidding on in the open exchange. The nature of a private marketplace means advertisers can benefit from being able to make more informed decisions about their content, placements, and formats – this results in improved ad quality and brand suitability. This solution equips publishers with stronger trust metrics while cutting out targeting to fewer desirable apps, which in some cases pull in traffic due to questionably high engagement rates.

As methods like auction packages are used more frequently in conjunction with ad verification technology and improved brand safety practices, perceptions of buying in the mobile space will improve, along with channeling investment into quality publications and apps.

Lashanne Phang, senior director, mobile, PubMatic: As the programmatic players in the industry get more sophisticated, technology platforms are able to provide increasingly innovative solutions, offering granularity in media selection and audience targeting through solutions like auction packages. An auction package is a collection of open marketplace inventory specified by targeting criteria set by a media buyer or a supply-side platform (SSP). The targeting is applied at the SSP level and passed via a deal ID which typically represents a multitude of app domains.

Not only do these addressability features improve user experience by bringing more relevant ads to them, they increase brand engagement with the target audience, and hence advertiser ROI, too. Most importantly, auction packages give buyers more control, which means reducing risk around brand safety, and increasing the option to access only quality mobile in-app inventory.

Elaine Tan, head of sales, South East Asia, international business department - advertising, iQiyi: Auction packages offer transparency and control when buying open market inventory. Buyers can customize and select the publishers, demographics, and environments they wish to target. Buyers know what they’re bidding on and they can utilize premium, omnichannel inventory across premium publishers. Auction packages help publishers, like iQiyi, to monetize their inventory effectively and efficiently. iQiyi actively builds our accurate user data platform in the walled garden ecosystem, and this is the advantage of premium OTT platforms with large user bases. Of course, we will also actively cooperate with industry partners to connect the possibility of universal ID, all to provide advertisers with more accurate and efficient auction packages.

What more can the industry do to elevate the perception of mobile programmatic?

Dominic Barnard, head of programmatic, GroupM APAC: To build further trust in programmatic mobile buying, we need to prioritize the balance of consumer privacy and personalized, non-intrusive advertising. To achieve this balance, there must be increased awareness of the consumer-advertiser value exchange. If advertising is delivered in a way that complements the mobile ad environment and dovetails with the consumer's values, there will be less objection to interacting with ads, especially when free content is the reward.

Given recent announcements such as Google’s plan to introduce the Privacy Sandbox initiative to Android, it is clear the increased focus on creating a privacy-safe buying ecosystem for consumers will continue to be a key priority for the industry.

Lashanne Phang, senior director, mobile, PubMatic: Advertisers are already seeing the value of programmatic mobile app – we recently commissioned a study from Forrester which looked into the state of in-app advertising in APAC, and it found that 80% of APAC advertisers or media buyers use programmatic in-app in their media plans frequently or every time. And for good reason…. Mobile app inventory offers advertisers incredibly rich data that comes from app and handset usage, and can be used to deliver more relevant, targeted advertising. Meaning better user engagement, less wastage and better campaign ROI. Coupled with programmatic technology, this targeted advertising can be delivered at scale, and with more accuracy and granularity.

But that’s not to say that hesitation from buyers doesn’t still exist, it does. Mobile app publishers have been slower to adopt the industry standards that helped to clean up the programmatic web ecosystem – things like ads.txt, SCO and Sellers.json, and it’s meant advertisers still have some legitimate concerns about ad fraud and murky supply chains. But things are changing – increased awareness of these app.ads.txt, OM SDK etc. across the industry means adopting these standards is quickly becoming best practice for any mobile app publisher looking to compete for global programmatic demand.

As an industry, we need to continue to push for widespread adoption, so advertisers can be sure they’re buying what they think they’re buying and their ads are being seen by real humans.

Elaine Tan, head of sales, South East Asia, international business department - advertising, iQiyi: The viewability of ads is a challenge for mobile programmatic advertising. Advertisers will naturally only want to pay for the impressions that have been viewed, and not for the ones that are served but not viewed. For mobile programmatic advertising to be successful, there is a need to strive for 100% viewability.

The industry also needs to band together and adopt methods to mitigate ad fraud. To prevent inefficient mobile ad spending, brands and agencies need to demand transparency. Overall, the mobile programmatic ecosystem will improve if the industry continues to set specific standards, and advertisers demand more clarity from their agencies and partners. Mobile has great advantages on both personal targeting and interaction when compared to other devices, and mobile programmatic advertising is expected to continue to grow from strength to strength.