Over four years ago, UK advertiser trade body ISBA and PwC ran a landmark study into transparency in programmatic supply chains with two simple goals: figuring out what an average programmatic supply chain looks like, and how much of an advertiser’s spend ends up with each part of the supply chain. The headline figure which came out of the study was that 15 percent of all ad spend couldn’t be attributed to any specific part of the supply chain – an ‘unknown delta’ as the report put it.
This unknown delta sparked concern about where this cut of ad spend – accounting for a third of supply chain costs, was ending up. But a major takeaway from the report was the difficulty that ISBA and PwC had in running their supply chain audit in the first place. Many vendors didn’t provide log level data, and data often wasn’t standardised between different companies, making it very difficult to follow the flow of money for specific impressions from buyer to publisher. This in itself likely was a big contributor to the unknown delta.
A follow-up study last year found significant improvements. The process of running the audit, while still not perfect, was smoother than it had been. The resulting unknown delta sat at three percent, a significant drop from 2020.
ISBA’s studies gave an overview of the average supply chain, and the trade group emphasised that each individual advertiser’s supply chain would look quite different. In order to really understand what was happening within their own programmatic buying, advertisers would have to run their own audits. Clare O’Brien, ISBA’s head of media at the time, said that these types of financial audits should be a normal feature of programmatic markets, as with other media channels.
Tools in advertisers’ hands
The problem for advertisers is that running these sorts of audits is difficult. ISBA and PwC, when given time and resources to conduct their studies, encountered challenges. For an individual advertiser looking to fit an audit around its regular media buying activity, these challenges could easily be enough to put them off of running an audit in the first place.
ISBA has been working to remedy this problem. The trade group released a ‘programmatic financial audit toolkit’ in 2022, designed to help advertisers run their own audits in a standardised way. Today, it’s released an update to these tools, which include a letter which advertisers can send to vendors asking for log level data, guidelines on how this data should be provided, and guidelines on how it can be used (as some vendors expressed privacy concerns about sharing data during ISBA’s studies).
ISBA hopes that these tools will make programmatic financial transactions a more routine part of running programmatic campaigns. “Our members are delighted that these updates are now in the market, bringing the auditability of programmatic advertising spend in line with other media channels,” said Dan Larden, ISBA’s head of media. “At a time when these informed refinements will make it much easier for many advertisers to gather a deeper understanding of their spend across all media.”
The tools to run audits are in advertisers’ hands – it’s up to them to use them. As much as ISBA’s original report generated a big reaction within the industry, it still requires significant commitment for an advertiser to run an audit – rather than relying on industry-level pushes to improve transparency. And in a world where tech giants are increasingly encouraging advertisers to use black box tools to run campaigns, which provide little or no insight to exactly where an advertiser’s ads have appeared, some might question whether the extra transparency over a portion of their digital buying is worth the hassle.
The flip side is that as programmatic buying becomes more transparent through these types of audits, advertisers might see value in shifting more money away from black-box tools, potentially pressuring them to share more data.
