The Incorporated Society of British Advertisers has published a study on the programmatic advertising supply chain, in which it calls for far-reaching reform.
The study was funded by advertisers and carried out by PwC. It is the first time that programmatic advertising supply chains have been mapped from end-to-end, anywhere in the world, and builds on previous industry initiatives in the US. The intention was to provide a more transparent view of the UK programmatic supply chain
It sets out to:
- identify each element of the supply chain,
- understand the services delivered and the costs applied at each stage, and
- provide a transparent picture by mapping supply chains from start to finish, using real market data.
The study reveals the depth of the supply chain’s lack of organisation and complexity. A total of over a thousand distinct supply chains were identified. PwC encountered:
- a lack of understanding and consistency among the adtech suppliers about how they could legally share data and what permissions were needed;
- a lack of uniformity on data storage and formatting; and
- the fact that data captured by a demand side platform (DSP) for an impression is not equally captured by supply side platforms (SSP), which hindered impression matching.
These challenges and complexities do not serve the principal interests of advertisers or publishers.
The major findings of the analysis of the ‘industry waterfall’ (where advertisers’ money goes), were that:
- publishers receive 51% of advertiser spend on average; and
- taking other visible costs such as DSP/SSP fees and other technology costs, 15% of advertiser spend, representing around one-third of supply chain costs, could not be attributed.
Consequently, the study makes two key recommendations for advertisers, publishers and the industry as a whole:
- standardisation is urgently required across a range of contractual and technology areas, to facilitate data-sharing and drive transparency; and
- industry collaboration is now required to further investigate the unattributed costs.
To take these forward, ISBA, its members, and its partners now plan to:
- immediately convene a cross-industry taskforce to begin work on studying the causes of the unattributed costs; and
- separately, facilitate an independently-led effort to work on standardisation and data sharing, for robust supply chain verification.
