Ad fraud is a repeat that TV doesn’t need
Opinion: 100% Media 0% Nonsense
There is rightly so much excitement about connected TV with new entrants, new products and new advertising opportunities. But with bigger audiences comes the threat of greater ad fraud.
As a father of one (and soon-to-be father of two), I can confirm that children don’t know anything.
That’s not fair — they know some things. But the vast majority of their knowledge is quite simply rubbish and it leads to some pretty bad life choices that need to be corrected by responsible adults. Kids treat each other poorly. They want to eat garbage all the time. They are inexplicably arrogant.
And too often, we are seduced into believing that the media habits of younger people represent some sort of window into everyone’s future behaviour. Watch out for this as we enter the season of ‘2023 predictions’.
Hence there is a tendency for marketers (and, I hate to say, much of the marketing trade press) to go gaga for the ‘yoof’ popularity of the latest social media app or videos on YouTube that have gone “viral”.
I nearly choked over lunch with a media agency boss last summer when he told me that a client kept encouraging him to spend more money on a social media platform, despite the agency informing this marketer that it was no longer providing a return on investment.
“No, you don’t understand, we need to up spend on social because we need to show the CEO how a certain proportion of our marketing budget is going on digital. We don’t want to look out of touch,” was the bizarre rationale.
Thankfully, there was very little of this nonsense on display at last week’s Future of TV Advertising Global event in London. For a medium supposedly in decline if you look at younger people’s viewing habits, there were well over 1,000 attendees. These hundreds of people showed excitement about TV’s future — even in the midst of a recession and cost-of-living crisis — over the two days.
The broadcast TV family is growing
There was clearly massive interest in what Netflix and Disney ad bosses would have to say, given Netflix’s recent launch of a cheaper subscription with advertising, followed by Disney+ last Thursday.
Whereas the future of TV was once streaming, the future of TV has turned out to be TV, after all. Netflix has signed up to BARB’s independent audience measurement, while Disney+ had already quietly been a BARB member for over a year, The Media Leader reported in October.
Both companies’ ad bosses gave very compelling interviews at FTVA, but for different reasons. Netflix’s Jeremy Gorman displayed a bucketload of good intentions and ambition about what the company is planning for its advertising offer, which was at complete odds with the previous narrative — co-founder Reed Hastings having previously sworn off ads and was forced into a U-turn when subscriber numbers began to fall.
Disney’s president of advertising Rita Ferro was distinctly more circumspect in terms of where Disney+ will go as an ad platform, but gave an interesting insight into just how much restructuring and development has been going on behind the scenes to simplify buying opportunities.
There was also significant representation from Sky and ITV in particular, and each have a lot to talk about with the respective launches of Sky Glass, Sky Stream and ITVX within the last few months.
You couldn’t attend this conference and not be impressed with the level of innovation and product development that has taken place in TV in recent years. The disruption brought about by the internet is being matched by innovation. Not innovation for innovation’s sake (cough cough metaverse, cough), but by what consumers (of all ages) really want: choice. The choice to watch something now or later. The choice to watch something with ads or not. The choice to watch a particular genre or programme format because of smarter ways of serving content and not expecting users to scroll endlessly through a sea of thumbnails and series titles.
Offering this level of choice should be table stakes by now on TV, not a source of competitive advantage. As ITV’s MD, commercial, Kelly Williams pithily said during a panel: “We should compete really hard on content and collaborate around tech, data and measurement.”
Elephant in the living room
And yet there’s always that one thing that no one wants to talk about: ad fraud. I can just picture you, dear readers, tutting or rolling your eyes at the very mention of the term. But here I go again.
I’ve already warned how no one seems to care about ad fraud, given how little response there is by media buyers or media owners about how to tackle it. CTV is an ad fraud magnet because a) CTV ads have very high prices (CPMs) and b) ad fraud measurement seems to be utterly inadequate, according to one of the industry’s most prominent ad fraud researchers.
“No one, including me, can reliably detect the fraud. We have to wait till the bad guys get sloppy or too greedy,” Dr Augustine Fou tells me after the FTVA conference.
We saw this during the height of the Covid-19 pandemic, as Fou wrote earlier this year, citing TVision data: “Even though streaming during the daytime hours nearly doubled during Covid, CTV fraud multiplied 100-fold — because it was easy to believe there was SO much more streaming ad impressions to be purchased.”
Much of the TV salespeople I spoke to at the conference were understandably optimistic that 2023 would see big increases in CTV advertising spend. Importantly, this is in addition to, not replacing, traditional/linear TV adspend, with marketers broadly choosing to spend less on other forms of digital advertising during the downturn.
But the danger here is that advertisers start pumping money into CTV because “that’s where the yoof is” without taking a hard look at the numbers. They might receive Excel spreadsheets at the end of the month telling them how many impressions they bought and what a great deal they’re getting, without ever truly interrogating how much of these impressions are real.
Following the conference, I asked Fou what advertisers need to do to ensure any increased ads going on AVOD/CTV are fraud-free: “The only way advertisers can buy CTV ads that are even plausibly real is to buy from real media sellers directly, not from intermediaries of any kind.
“Every intermediary has the incentive to look the other way and let the fraud happen because there’s simply too much money to be made, as advertisers frantically and blindly shift more money into CTV ads.”
There has been a lot of talk in recent years about TV and out-of-home not repeating the sins of website display advertising as they become more digital, i.e. don’t become a swamp of ad fraud and waste.
In other words, respect your elders. Learn from their mistakes. Listen to what they have to say. And eat some vegetables once in a while.