IAB Leadership Summit Reveals Industry Challenges

Digital advertising has come of age. Online advertising is now the second highest segment of advertising (at least in the US) and we in the industry no longer have to convince media buyers to send budgets online.
However, now we have to prove that those online budgets bring benefits. In a significant move, the IAB announced at its annual leadership meeting that it will now allow ad tech companies as full voting members, acknowledging the importance of data as well as inventory to the industry.
Despite the growth and wholesale acceptance of online advertising, the industry still faces some challenges: consumer consumption habits are changing faster than the industry can figure them out, brands are challenged to keep up, and marketers, agencies and publishers all find their costs increasing because of audience fragmentation and growing demands for customization. The “mass” has gone out of mass media, and with it the economies of scale. In this new environment, publishers have a hard time affording to produce the kind of journalism a free society needs.
Several critical questions remain to be answered by the industry.
1) Should viewable impressions be the new currency?
The viewable impression has technical and measurement challenges that prevent 100% viewability from being a standard in 2015. We’re in a transition period on the path for 100% viewability, but until measurement technology improves to the point where different measuring companies can come within 10% of one another, we don’t have a good metric. The industry is working toward a digital GRP, but I’m not sure GRPs are all they’re cracked up to be.
2) Will native advertising stick?
On every new platform, ads begin as an awkward accompaniment and only later begin to fit better into the new content and context. That’s where native advertising is now. Native ads represent a fundamental turning point in advertising, but they are an addition to, not a replacement for, traditional ads. If you think of ads as falling into three categories, from pure branding to the presentation of information, to the bare performance ad, native ads should come in the middle of the funnel. We sorely need some standards as to how to present native ads without alienating consumers.
3)What kind of advertising works on mobile? The simple answer is “no one knows.” Yet. Right now, mobile ia the frontier, and most brands can’t create, plan, buy, and measure mobile ads. As a result, most mobile ads tend to be performance ads, which is how all digital advertising started.  After we get our arms around the bottom of the funnel, we’ll start to move up toward the top with brand ads and informative ads. One thing we can already see; digital video will be one of the fastest growing segments of advertising and most of it will be consumed on devices.
4) Is programmatic good for everybody? Programmatic is just the automation of the selling and buying process, and right now too many different ad stacks are being used, which makes the process  seem muddled and  slower. But this year there will be an industrywide push for open RTB standards, and for a common, non technical vocabulary that we can all understand and agree on. Then programmatic will be good for everybody.
5) Who will finally address the issues of fraud?
Last year was the year in which ad fraud came to the attention of everyone, whether inside or outside our industry. The viewability issues raised the initial question of fraud, but now the prevalence of data reveals the percentage of clicks and views that come from bots as well as the incidences of malware served to unsuspecting site visitors. Neither publishers nor advertisers can afford to ignore fraud anymore. IAB has thus formed the Trustworthy Accountability Group, a monitoring body to get the bad, immature and incompetent actors out of the supply chain. All marketers who place tags on a page are under warning.
6)And finally, how can we close the skills gap in the industry as well as increase diversity?
Ad sales, operations, and media content creation are all knowledge-based and require continuously learning employees.  IAB is pushing for some sort of certification for ad industry employees, and of course for an education program to go with it.