Curation and outcomes: Step in the right direction or another false dawn?
Opinion
In a questionable open web, there is little evidence yet that ‘curation’ and accountability for ‘outcomes’ are effective and improve transparency. So what needs to change?
AI is changing the public’s behaviour at lightning speed as they adopt new tools that improve on old ones.
We are witnessing a revolution throughout the whole spectrum of paid and organic channels, with technology strengthening the power of the latter.
The public’s use of AI has already changed the search, discovery and buying process, but advertising industry discourse seems fixated on how AI will change how we work, not how advertising itself is changing.
It is inevitable that everyone wants to deliver their “hot takes” on Cannes, Linda Yaccarino and Cindy Rose, but these mask more fundamental issues concerning people’s use of technology and its effect on our industry.
In the “many to many” age, winners in our business will be those that can use new technology to track people’s behaviour as they scroll, stream, search and shop, and build effectiveness into communications strategy, not just to buy media.
AI can optimise multichannel communications planning as well as the executional process.
In fact, how we use technology, data and analytics for choosing the right permutations of content and channels should be our main preoccupation.
We should discuss in conferences and public forums how we improve advertising effectiveness through talent, tools and advertiser transparency, converging content, channels and analytics across the spectrum of available options.
Sounds like a job for smart agencies that earn their just rewards with integrity by adding value, not extracting it.
While we’re at it, let’s discuss how we make advertising work harder by making it more people-friendly. Good advertising engages the public. Who knew?
In short, let’s focus on how we connect advertisers with their audiences effectively and efficiently, rather than leaving advertisers and the public frustrated by ads that are intrusive, irritating, irrelevant and ignored.
The personalisation era is 15 years old, but there is scant evidence that it has produced sustainable, incremental, profitable growth for most advertisers.
Yes, some businesses have prospered in this environment, but real evidence of success is sparse beyond the dashboards that may or may not be proof of advertising effect.
What does ChatGPT tell us about the success of modern-day marketing and its new technologies?
Perhaps unsurprisingly, it presents aggregated commercial claims as fact, stating that “first-party and behavioural data drive rewards-based, hyper-personal campaigns”.
Ineffective open web
In the absence of anything more wide-reaching, there are some valuable analyses into one sector of the industry from Warc and from the US Association of National Advertisers NA/Fiducia/TAG TrustNet consortium, both of which look at the programmatic media market in isolation.
The ANA-led study presents analysis of a cross-section of programmatically delivered media from Q1 that shows modest improvements since 2023 in the reduction of intermediary costs pre-display (26.1% vs 29%), a marginal reduction in the loss of “media productivity” (35% to 32.9%) and an uptick in “true adspend” (essentially ads that get seen) from 36% to 41%.
This latter figure is generous, given that the study doesn’t include agency fees, works to an invalid traffic score that many observers would find unrealistic and Media Rating Council exposure thresholds that other commentators would describe as “ludicrous”.
In other words, at least 59% of open web display spend still falls below the consortium’s charitable definition of an ad exposure that stands some chance of having some effect.
Basically, well over half the money spent on open web display may as well be set on fire. The ANA doesn’t and can’t report on whether the rest is effective.
While this study identifies some $21.6bn in potential improvements worldwide, this number doesn’t include the waste in creation, production and time, nor the environmental cost.
The Warc study uses the ANA results among its findings and describes how the open web is losing share to walled gardens.
One adtech executive quoted in the report said that “the open web’s strength lies in accountability and collaboration, delivering better results for advertisers, more revenue for publishers and richer experiences for consumers”.
Warc’s report shows there are no real grounds for believing that any of this is actually happening.
The most important role of these studies is to show — yet again — just how ineffective and inefficient the open web market is, how slowly it changes and how much money is being made by intermediaries for such little effect.
And why the walled gardens are laughing all the way to the bank. Again.
Curation success?
An increasing number of ANA members are starting to address these issues, but progress remains hampered by the commercial interests of the supply side.
This includes some media agencies, many of which can’t afford to give up the revenues from the complex supply chain in favour of improving their clients’ performance.
However, there are hopeful signs. At last, the question of ad quality in the open web has gained some traction in the move to “curation” of websites and apps.
Publishers and supply-side platforms (SSPs) are working together to provide better deal IDs that aggregate better-quality inventory and are selling directly to media agencies, cutting out some “hops” in the supply chain.
As the open web stagnates, the tech providers that rely on it are fighting for relevance and revenue, aiming to replace each other.
We are seeing expanding curated private marketplaces (PMPs) and a lower level of auctioning in the market. The supply chains are shortening.
What we are not seeing yet are identifiable changes in the market that indicate the success of “curation”.
The ANA-led study shows that PMPs are now two-thirds of the measured market, up from 41% in 2023, but there is little evidence that they perform better than the open market.
In fact, the number of domains being used by each advertiser has increased, from 44,000 in 2023 to 53,000 this year. This is the opposite of what a curated market should look like; the study reports that 90% of impressions were delivered by only 3,000 domains and apps.
The number of SSPs being used has also gone up, from an average of 16 to 19, partly caused by the measurement of more connected TV. But this doesn’t yet look like an industry getting to grips with its long tail problem.
Maybe of even greater concern is the suggestion that the trend towards agencies going direct to SSPs and PMPs is the control of supply that favours the agency, with potential conflicts of interest.
But this wouldn’t surprise.
Accountability for outcomes
There is also a long-overdue discussion about “outcomes” — a nebulous word that simply means “people seeing ads and doing something as a result”.
This is at least a step up from just throwing billions of impressions at the wall, but there are potential hurdles to overcome.
Driving “outcomes” should dictate a “less is more” strategy, involving a greater emphasis on data-led targeting, better attention scores through better-quality media, a move towards “true” value and not just cost, and fewer domain and apps. In other words, “curation”.
In a market that pays out handsomely just for serving ads, this isn’t going to happen.
If and when advertisers do start paying for “outcomes”, the intermediaries and publishers might just bombard the market even more in the pursuit of… something measurable that they can claim as a win they can charge for.
In short, there is little evidence yet that “curation” and accountability for “outcomes” are happening, are effective and improve accountability and transparency.
Innovation needed
We’ve become accustomed over the years to high levels of invalid traffic, rampant fraud, low viewability (at low thresholds), ugly “chumboxes” everywhere, made-for-advertising sites, huge fees and mark-ups, rebates and data fees.
And we’ve got used to publishers being squeezed by agency pressure, much-reduced referral traffic through AI, original content being skimmed by large language models, having to fight in the revenue puddle after the platforms have emptied the ocean, and new competition from retail media and customer database networks.
Given these challenges, it’s hard to believe “curation” and “outcomes” will save the day even if they start to have some effect.
The Warc report concluded that success for the open web “would require a very different supply chain and incentive structure from what exists currently — with far fewer intermediaries and competing interests”.
It’s hard to disagree.
The market is crying out for innovative solutions that don’t get caught up in the old-style mechanics and economics that have bedevilled the open web and could kill it.
Let’s not allow ourselves to believe that the programmatic market is anything more than one piece of the bigger technology, data and analytics pie that underpins the whole advertising industry.
But that’s another column for another day.
Nick Manning is the co-founder of Manning Gottlieb Media (now MG OMD) and was chief strategy officer at Ebiquity for over a decade. He now owns a mentoring business, Encyclomedia, offering strategic advice to companies in the media and advertising industry, and is non-executive chair of Media Marketing Compliance. He writes for The Media Leader each month.