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Below is a roundup of last week’s notable industry news, with summaries and our opinions. The industry is cleaning up its act!

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Top Story 👁️ 

Marketers’ digital waste declines yet DSP transaction costs rise🔒
December 12th, 2024
Source: Ad Age

Summary: Programmatic media buying is becoming more efficient, according to the latest update to the ANA's 2024 Programmatic Transparency Benchmark Study. The trade group that represents advertisers found that more ad spend is reaching consumers in quality environments as fewer dollars flow to made-for-advertising (MFA) sites (which are essentially low-quality, clickbait websites). In 2023, the ANA estimated that MFA sites captured 15% of US ad spend, but that fell to 6.2% this year. Another critical stat: marketers advertised on nearly 50% fewer websites and apps in 2024, which generally implies that programmatic “clean up” efforts are working.

That's progress to be sure, but it's too soon for the industry to pat itself on the back. Still, less than half (43.9%) of ad spend is actually reaching consumers (last year, 36% reached consumers). And transaction costs are rising, with demand-side platform (DSP) costs increasing by 0.8%, reaching 16.8% of ad spend. However, DSP costs for connected TV are considerably lower, at 8.8% overall. Advertisers are also working with more supply-side platforms (SSPs)—19—than ever, which goes against the ANA’s recommendation to work with fewer SSPs, not more.

The study was based on log-level data from advertisers and platforms including TripleLift, Yahoo, and Google’s Display and Video 360. The data encompassed $235M in ad spending from April to September of this year. The ANA compared this data to ad spending from September 2022 to January 2023.

Opinion: Frankly, this is awesome. It may not be sexy as M&A or as provocative as antitrust, but it’s incredibly impactful.

That said, the job is not done. Publishers aren’t reaping the benefits of increased efficiency. In order for advertisers to drive even better outcomes and for more dollars to flow to publishers, progress must continue in the following areas:

• Lowering technology costs

• Reducing bot traffic

• Cutting inefficient supply paths

• Eliminating MFA inventory

How will we get there? By ensuring marketers get full transparency into their supply chain, and are knowledgeable enough to know what to do with the information. The ANA, and others across the industry, are doing the hard work to shine a light on the issues and help marketers take action. Let’s all support the cause! (we’re looking at you, ad tech companies)

It’ll lead to better outcomes from programmatic advertising, which will lead to happier advertisers, which will lead to more programmatic spend, which will lead to more revenue for ad tech companies, which will lead to more revenue flowing to high quality publishers, which will lead to … a healthier open web.

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That’s It For This Week 👋

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