Reflecting on a decade long journey of verification and measurement companies: what lies ahead?
This year marks a major milestone for digital advertising, it has been 25 years since the very first digital display ad that appeared in 1994. The ad was purchased by AT&T on Wired Magazine’s hotwired.com as a part of their larger “You Will” campaign.
That particular banner ad received an almost unbelievable 44% click-through rate (CTR)! But while modern CTRs sit at fractional levels, brand marketers realised along the way that CTR is far from the best measure of success for their objectives. As it turned out, ad clicks don’t make for a good proxy for brand resonance and message cut-thru.
25 years later, advertisers know that we need to go far beyond the click to understand if we are truly resonating with audiences and capturing their attention, but even today there is a debate on how to best do this. Let’s take a look at the evolution of our industry to understand how we got here:
Along with the first banner ad came a path to a two-way dialogue between brands and people.
Digital transformation empowers new marketing opportunities
Along with the first banner ad came a path to a two-way dialogue between brands and people. Instead of one-directional communication which was the signature of mass media through the ’70s and ’80s, by the mid-1990s brands were now able to have a somewhat two-way conversation with consumers through email and chat.
A couple of decades later, this multi-directional dialogue has exploded with the advent of social media and consumer review platforms. Consumers now commonly speak to brands, they commonly speak to each other about brands and experiences and they do these things at a massive scale.
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For the retail category, this has progressively morphed towards ‘direct-to-consumer’ (DTC) business models where ‘brands’ (or, more often than not, products with a distinct lack of brand) can promote their product or service straight to its target audience and own the entire path-to-purchase - all the while capturing valuable first-party data.
Digital advertising has allowed marketers to target consumers more precisely with more personalized, relevant information, in real-time on multiple-devices and on-the-go. Businesses are truly putting the consumer at the center of all strategy and activity, meeting their increased demand for authenticity and control. This agility to adapt has augured well for the marketers and the overall digital ecosystem.
According to recent reports, digital ad revenue in the US surpassed $100 billion for the first time in 2018 and it’s on an upward trajectory, all set to overtake traditional media ad spends globally.
So what caused the ‘Wild West’ digital ecosystem?
As any given new medium is adopted by people, advertising budgets quickly follow; ad spend follows eyeballs. We saw this with the original desktop internet, we’ve seen it with mobile and we are starting to see it in new environments like connected television (CTV). The problem here is that not only do ad dollars follow eyeballs, but fraudsters follow where the ad spend goes as they try to capitalize on nascent systems.
With digital ad spend continuing to boom and gain even more scale globally, the industry is becoming laser-focused on being accountable and transparent. P&G’s Marc Pritchard (who also happens to be steward of the world’s largest advertising budget) has said that the digital media supply chain can be “murky at best and fraudulent at worst.'' While the wealth of data available can make digital advertising far more accountable, a lack of transparency, viewability, and an increase in fraudulent activity and invalid traffic threaten the integrity of the complex ecosystem between brands and people.
Digital advertising’s highly personalized nature should make it more relevant to audiences, but ad blocking, low response rates and privacy concerns are causing barriers. As the complex story of digital advertising continues to unfold, many companies are still struggling to respond effectively. Amidst all the turmoil, industry players have been taking a stand to impose media quality standards and re-build confidence in the ‘Wild West’ digital ecosystem.
Role of verification companies in cleaning up the digital ecosystem in the last decade
As advertisers expanded their reach into the unknown digital territory, marketers found that their brand was unintentionally and unknowingly being exposed to risky placements. Marketers, publishers, and platforms have turned to ad verification technology to help mitigate the risk associated with digital advertising. With IAS’s inception in 2009 began the rise of verification and measurement for the industry, marketers could now verify if they were reaching real people with viewable ads in suitable environments.
A few key players on the media and tech side of the table have been stepping up with joint initiatives and commitments of their own to address Marketers pressing media quality issues such as:
- How do I satisfy my chief executive that advertising dollars are well-spent?
- What resources can I deploy to help address advertising fraud?
- How can I measure engagement?
- How can I better control where my organisation’s brand shows up?
- How can I navigate through digital advertising barriers to get results?
Not surprising that eMarketer data suggests that delivering marketing efficiency in this complex landscape is the top priority of CMO’s globally.
The next decade of growth for verification companies
Bad actors and fraud aren’t going anywhere - and they may even continue to trend upwards in the digital advertising space. But brands using verification solutions can guard against these issues and even increase their campaign performance and return on investment using time-based metrics and ad buys with quality impressions.
Looking back to the days of rampant credit card fraud, customers guarded their cards and account information with all their might, knowing that there wasn’t another, safer solution. But in time, banking and credit companies made significant advancements like multi-layer authentication, verification, 24/7 customer support, card blocking and more. This shift in focus from ‘negative’ to the ‘positive’ and taking care of the basics has led them to enhance customer experiences, which has served them well.
The same will hold true for the digital ad verification industry. The future success of verification and measurement companies will depend on their ability to predict, protect and proactively steer marketers away from poor media quality buys towards delivering ROI and helping them achieve business results.
Verification will continue to be the quintessential foundational step, but the process will not end there. Verification companies will be more like partners in the quest for connection with consumers, enabling brands to achieve their business and campaign objectives.
Stephen Dolan is the managing director for Asia Pacific at Integral Ad Science. The Drum will be reflecting on 25 years of digital advertising at the upcoming The Drum Digital Advertising Awards APAC and Programmatic Punch APAC.