The shiny age of "ad tech" has slowly faded into a deep abyss as the growth of digital advertising calls for more transparent practices and scale than ever before, with a need for solutions that offer more than just general technology for advertising's sake. This need couldn't come at a better time, as in Q3 of 2015 alone, the U.S. reached its highest spend ever with $15 billion in ad revenue, according to IAB.
While it may seem evident that we're on the brink of a digital advertising spend boom, there are still a number of challenges that must be addressed from ad fraud to ad waste, ad blocking to relevancy, in order to maximize this upward trend. Despite the fact that the list of problems seems never ending, we find ourselves in a good position to tackle the ultimate question head on: what can really be done?
Time to address the hype
With most of the "hype" around ad fraud and intrusive ad placements, there is a bit of opacity in the industry, as advertisers tend to turn a blind eye when certain problems and issues are brought up. However, we are starting to notice that these problems could be capping even greater industry growth, due to the sheer fact alone that brands and advertisers today are begging for a better experience when it comes to engaging consumers. On a constant mission for better relevancy and less intrusiveness, advertisers are increasingly raising questions about the transparency of decisions and the costs involved across the entire ecosystem. This is where hype turns into reality.
As of late, neither the publisher nor the advertiser has had a complete view of the whole buying and selling process. With little insight into where their ad spend is actually going, the advertiser has a poor experience because they are unable to get a clear and accurate view of their return on investment. At the same time, publishers often see only a proportion of the total revenue and not the full fee paid by the advertiser. In this environment, many different tech providers are competing to try to bring an additional benefit to the process.
The irony is that there are so many of these point solutions that it's hard for them to create any real value, for the publisher or the advertiser. Until now, no single party has had a complete view of the whole buying and selling process. When all is said and done, despite these problems, one thing will remain certain; advertising is not going anywhere -- people need it. So this is just the beginning of the rally cry to the industry. The time has come for the advertising industry to face a reality check and get its act together.
Time to fix what's broken
With so much fraud and waste in the industry, there needs to be a stable "fix" that benefits everyone -- publishers, advertisers, and consumers alike. And while the industry is optimistic that the current problems stirring up will be the best thing that has happened to the space in a long time, more people need to make this a priority in order to ramp up the timeline for change.
One of the biggest problems is that we live in a quarterly business world. Getting rid of waste and fraud at once will hurt businesses for some time, but it's the only way to "cure" the problem and create a long-term solution.
Until this happens everywhere, we must continue to push for solutions where the right message is delivered to the right person, in the right format, at the right time -- basic principles of marketing. Only then can we provide total transparency to create a more streamlined, understandable, and positive experience for everyone involved. By becoming more transparent, advertisers will have better-performing ads, which in turn makes publishers more money with less ads. This will help allow for a better user experience and a better balance between the value exchange between ads and free content, a problem that has led to the rapid growth in popularity of ad blockers. Consumers are being turned off by intrusive, irrelevant advertising content, and advertisers are having to go after cost, meaning it's a race to the bottom. A strengthening between these groups needs to happen…and fast.
The only way for publishers to win back user loyalty and trust is to provide a better, cleaner content-consumption experience. We can clearly see from the latest IAB revenue figures that digital advertising is going to continue to post massive growth figures, despite the issues addressed. For consumers to get access to free, high-quality content and have a more pleasant experience that is informative and relevant, consumers need to actually start to value the ads -- in the same way readers who buy "Vogue" or "GQ" value the ads from high-end luxury brands, where the ads are as much a part of the content as the editorial.
With all of this change taking place, the time is now to say goodbye to the ways of old ad tech, and usher in new solutions that offer a win-win-win for publishers, advertisers, and consumers alike. Only time will separate the problems from the solutions, the opaque from the transparent, and the old ad tech from the new.
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