On Sept. 27, The Wall Street Journal reported the Association of National Advertisers (ANA) had been approached by the FBI for support in their investigation of “whether ad agencies received rebates from media outlets.”
This request apparently came after plainclothes FBI agents visited the offices of one of the top five holding companies and proceeded to collect laptops and other documents that may provide insights into the claims of continued rebates. ANA President Bob Liodice told potentially affected ANA members to seek counsel.
It’s not surprising the FBI is taking a hard look at the advertising industry, and it’s particularly unsurprising that the investigation has come at this moment. After all, the FBI is joining a growing cadre of policymakers and other opinion leaders pointing out what many of us have known for some time: the digital advertising model in the US is overdue for a serious overhaul, one that will inject transparency, metrics, data, and confidence into the system.
Why must we continue to have this dialogue surrounding fraud, transparency, and bad actors? Solving this problem now—that is, cleaning up our own house before regulators step in in a major way—may be the best thing we can do as an industry in this moment.
A Long-Brewing Fiasco
For those of you whom have been on the sidelines, the questions surrounding privacy, transparency, and fraud in digital advertising have been lurking for some time. The June 2016 report “Independent Study of Media Transparency in the U.S. Advertising Industry,” conducted by K2 Intelligence for the ANA, painted a bleak picture of media-buying practices.
You might have thought that would have been the beginning of the end of questionable buying practices. Sadly, that would be wishful thinking.
Why must we continue to have this dialogue surrounding fraud, transparency, and bad actors? Solving this problem now—that is, cleaning up our own house before regulators step in in a major way—may be the best thing we can do as an industry in this moment.
To say that the digital media ecosystem is convoluted would be uncontroversial. The industry is beset with a number of intractable problems, many of which stem from its convoluted and opaque supply chain.
Marketers and consumers alike have called for change for some time. Some could say those calls went unanswered. The result has been frightening (at least for some): from GDPR and California’s Consumer Privacy Act to last week’s FBI visit to one of the top advertising holding companies.
Blaming agencies is misguided. Many of the issues that created the questionable buying practices began with the KPIs brands themselves asked for. Not many are innocent in this story. Our industry lives in a world governed by a Prisoner’s Dilemma, where as soon as one actor does something a little out of bounds, others follow.
There’s Still Hope
Our future is not so bleak, despite what some may think. I have been fortunate to sit in meetings with the newly formed not-for-profit AdLedger.org. Its stated mission is “to further trust and transparency within the digital media space.”
In addition to the great work that AdLedger is doing, agencies like Omnicom Media Group and WPP are addressing the problems head on. In some recent press from DMEXCO, Omnicom Media Group and a client are testing a protocol to replace OpenRTB that uses cryptography and blockchain. If successful, this could very well be the magic bullet that marketers like Keith Weed of Unilever and Marc Pritchard of P&G have been asking for.
For those of us focused on real change, the recent probe should be just another call to action. It should not be seen as a challenge, but as an opportunity to seize our industry’s future: A future that is truly transparent (including data practices), privacy-compliant (e.g. GDPR), and fraud-free.
This is a call to action to those in the industry who want to help be part of the solution— as opposed to continuing being part of the problem.
The advertising industry has two choices: we can pretend there is nothing wrong and spend millions to fight regulations; or we can use new tools available to all of us now and act to provide the transparency across the supply chain needed to demonstrate we are able to prevent fraud, waste, and abuse on our own.