Advertisers don’t have a strong enough grip on the technological ecosystem to make informed buying decisions, agreed leaders of several leading ad organizations at AdExchanger’s Clean Ads IO conference.
Panelists from the Association of National Advertisers (ANA), the American Association of Advertising Agencies (4A’s) and the Interactive Advertising Bureau (IAB) got on stage in New York City on Tuesday to discuss issues holding the industry back from creating a better consumer experience.
Senior marketers still expect their media plans to follow a paper money trail that no longer exists in a programmatic world, and an ANA survey showed only 25% of members feel equipped to take on the complexities of the digital supply chain, said ANA CEO and President Bob Liodice.
And tech is moving “1,000 miles per hour” faster than the advertisers spending money, said Randall Rothenberg, president and CEO of the IAB.
The blame goes all around.
“From an agency perspective we’ve done a really bad job of helping our clients get educated,” said Nancy Hill, president and CEO of the 4A’s, which represents the agencies. “I don’t think we’ve done what we could’ve, which is take them by the hand and walk them through every step.”
And Liodice noted that advertisers have “done a really bad job of working with our agencies.”
Despite this acknowledgement, there is no easy solution. Rothenberg said the industry needs marketers with tech competency who understand, for instance, how to use just enough data calls to reduce latency.
“These people don’t exist at the top 100 brand marketers,” he said. “We need more technical competency in the value chain.”
Easier said than done. Marketers build brands, Liodice replied, they don’t do data calls. And as you move down the chain from the Fortune 500s of the world, technical knowledge gets expensive and harder to come by.
“Every day there’s a new media and way to reach consumers, and were trying to figure out how to leverage and integrate it while delaying issues like viewability or fraud,” Liodice said. “In all candor, marketers have been slow.”
With marketers in the dark, some agencies take advantage of naivety to ease the pressure from shrinking margins and rising technology costs.
Threats to agency profitability are still real. Take McDonald’s, which is preventing agencies from turning a profit on base compensation as a condition of its 2016 review. The fast-food giant spent $1.42 billion on advertising in 2014.
“We fall into holes when trying to be efficient,” Hill said. “Things are getting tight.”
Agencies scramble to make up their losses, some by skimming and double dipping off advertiser budgets and pushing their clients even further into the dark. Marketers are waking up to this, but they’re still not taking it upon themselves to make a change.
“The old paradigm is, ‘Agencies will take care of that for us.’ They’re not,” Liodice said. “We have to take more responsibility for the advertising quality we want to be delivered.”
When the industry takes a step back from its internal issues, leaders see they have all but forgotten about the consumer. With hundreds of millions of users tuning out brands altogether with ad blockers, leaders call for a shift in priorities.
“Consumers are the most important factor in this equation and we talk about them the least,” Hill said. “The rise of ad blocking shows that they don’t necessarily want to see our messages anymore.”
The Trustworthy Accountability Group, which released an anti-fraud program on Monday, intends to clean up fraud throughout the supply chain, and the ANA will release a report in June shedding light on the transparency issue. But the industry still needs to figure out how to create a better overall experience and recapture user attention.
“The whole ad-blocking problem is about people in this room doing things that over a period of years created a digital media experience that was so horrifying, upsetting and distressing to an average human being that given the opportunity with software they’ll say, ‘No más,’” Rothenberg said.
Watch the full panel:
