Navigating Media Investments in a Fast-Paced World
How the right data can help unlock value, ROI and transparency for media spend
Advertising hangs in a delicate ecosystem, and recently, it's at the mercy of environmental shifts beyond its control. The call for more trust, privacy, and transparency has led to the impending sunset of third-party cookies. Technology proliferation and increasingly complex digital landscapes has contributed to leaky media budgets and confusion about where media dollars are really going. Unlocking the right data around existing media spend can help restore balance between value, ROI, and spend transparency.
The ecosystem of advertising is changing
In the past, advertisers had a sea of data to understand and market to consumers. Campaigns were ripe with opportunities from data made available through first and third-party cookies. Now, advertisers face three major challenges that will likely become more urgent as the landscape changes.
1. Trust and privacy concerns
Third-party cookies have been the backbone of marketing and advertising campaigns for years, but new restrictions and consumer privacy concerns are curbing their use. Many brands have revamped their strategies to include built-in data collection notifications for users. But some internet browsers are driving restrictions further, announcing the end of third-party cookies altogether.
Blocking third-party cookies disrupts critical marketing capabilities like audience activation, retargeting, analytics, unique reach, frequency capping, and ad campaign attribution. Without viable alternatives, the consumer experience can take a downturn.
Consumers recognize the delicate balance between data and personalization. For users who want tailored offers, data sharing is acceptable –– as long as they're in control and brands are honest about how they're using data. In fact, 67 percent say the benefits of data sharing outweigh the risks and 76 percent consider it a "necessary evil."
2. Transparency issues
The question of data ownership and control comes at a time when advertisers are facing their own transparency issues with vendors. The programmatic supply chain can be riddled with waste, inefficiencies, and murkiness. A PwC and ISBA study found that 15 advertisers had nearly 300 distinct supply chains to reach 12 publishers — contributing to a complex, cumbersome and markedly opaque supply chain.
In a rush to keep pace with the attention of the consumer, brands are partnering with agencies to deliver on media efforts. Yet, according to the same PwC and ISBA study, only 51 percent of advertiser spend ends up as net working media. Of the net working spend, only 26 percent end up as viewable impressions. And though fees and some waste is to be expected, unknown supply chain costs can range from 15 percent and 86 percent. That's a whole lot of unknown to be paying for.
3. Technology evolution and inflation
In 2011, there were only 150 ad tech companies. As of 2021, there are over 7,000.
The complexity of the ad tech landscape may be resulting in a decline of media quality effectiveness. Lack of data transparency, data ownership, proof of results are just a few contributing factors and issues compound when brands realize how in the dark they may be.
The ad tech stack is under increasing scrutiny as more focus is put on ROI, which has been degraded by media cost inflation. Actual U.S. price inflation for consumers was at 8.6 percent in May. TV CPM Inflation is forecasted to net out between 10 percent and 20 percent for the year. Estimates for digital ad prices in the U.S. are expected to be 5 percent to 5.5 percent more expensive. Higher costs may have some companies feel the pressure to slow down ad spend — but this can hurt revenue. A better solution would be to audit media spend to unlock value — you just need to know where to look.
How to unlock value from existing media spend
To bring back control and transparency into media investments, brands need to be able to get full visibility into the advertising supply chain. Unlocking value from existing media spend using data gives advertisers a single-source-of-truth reporting for media spend and performance across brands, markets, channels, and partners, regardless of the buying platform. And full cost visibility and control allows advertisers to optimize spend and get more valid impressions.
To reap these benefits, advertisers can unlock value in four main categories:
1. Media fulfillment
Agencies are great at executing and automating strategy, but they don't always understand the heart of the brand. This can lead to less targeted impressions or misaligned media buy types. Look to identify under-delivery of ordered impressions and ask for agency buy reports to confirm accuracy. Ask fundamental questions, like:
- Do you have contractual rights to your data?
- Are you able to access your data and retrieve all metrics that you have rights for?
- Do you have documented media guidelines that are reported on and verified independently?
- Are these guidelines communicated with the publishers?
The due diligence is well worth it. Brands can reduce waste, obtain media credits, and gain transparency into media buy types to make sure that they are in line with campaign goals.
2. Media quality
To increase media quality, brands should set campaign quality benchmarks and buying guidelines that align with brand and campaign goals. Brands should periodically monitor inventory and remove wasted impressions such as those that are fraudulent, non-viewable or restricted. Create documented media guidelines and align quality goals with campaign goals so you can move toward optimal inventory and programs.
3. Media effectiveness
To increase media effectiveness, brands can implement campaign benchmarks to determine campaign success and monitor performance, turn-off/optimize out of non-performing tactics and creatives, and reallocate media from lower performing partners and media types based on quality and performance
Questions like "Are you re-allocating media buys across channels frequently?" and "Are you incorporating media quality into your optimizations?" can help start the conversation about optimization and effectiveness.
4. Transparency
Do you know who is buying your media and where? Is this media in your brand's best interest? Do you know of all the agency fees/markups you're paying for?
Increasing transparency with an agency of record is a key factor in identifying gaps, regaining data ownership, and eliminating redundant and ineffective partners. It also opens the door to obtaining media credits and assessing media effectiveness on a consistent basis.
By asking the right questions, your brand can gain insight into principal arrangements and whether media is effective; identify overbillings on media costs, platform fees, agency fees, hidden markups, or data costs; and determine who has access to your data.
The views and opinions expressed are solely those of the contributor and do not necessarily reflect the official position of the ANA or imply endorsement from the ANA.
David Fontanez is a director at PricewaterhouseCoopers.