It seems as if the biggest takeaway from Advertising Week is that the Financial Times announced it has been ripped off by ad fraud, even though it doesn’t sell its own video ads programmatically. And it was a big loss. The fraud happened entirely outside the magazine’s control, which only served to underline the lack of trust in the supply chain surfacing again this year. Although a couple of new organizations have formed to solve the problem of fraud in the media supply chain, not much appears to have changed.
Here’s what happened:
The Financial Times found display ads against inventory masquerading as FT.com on 10 separate ad exchanges and video ads on 15 exchanges — the publisher doesn’t even sell video ads programmatically — with 300 accounts selling inventory purporting to be the FT’s. The equivalent of a month’s supply of bona fide FT.com video inventory was fraudulently appearing in a single day. The FT estimates the value of the fraudulent inventory to be $1.3 million (£1 million) a month.
This is called domain spoofing, and it’s the main problem of using open exchanges. The Financial Times had to write to the exchanges involved and ask them to remove the fraudulent inventory. Then it had to write to agencies and their clients telling them not to source inventory from anywhere but Google AdX or TrustX, through which FT sells its display.
“The scale of the fraud we found is jaw-dropping,” said Anthony Hitchings, the FT’s digital advertising operations director. “The industry continues to waste marketing budgets on what is essentially organized crime.”
This is why we developed a totally secure private exchange a couple of years ago. When we handle transactions end to end, we know where every ad is at any given time, and we can also track its response. We have never understood why the industry tolerates wasting marketing budgets as it has in the past, although we hope this is (slowly) changing.
How can we tell it is changing? Agencies holding companies are reporting poor financial results. That’s because brands are now far more careful about entrusting their budgets to trading desks that engage in arbitrage. Who knew that one of the biggest ways agencies made money was by buying media in bulk and not passing on the savings to their clients? We thought that only happened in the world of late night TV and informercial companies.
The other important media announcement out of Advertising Week was the re-branding of Advertising Age Magazine as AdAge, and the promise to guide this industry through a disruption the publisher admits is under way. We’re a bit suspicious of the publisher’s new recognition that
Everything is a brand. Everything is an ad for itself. So our coverage needs to reflect the broader culture beyond the weeds of our industry. We’ll still get into those weeds, but we’ll also explore the flowers. And we’ll do it with a tone that’s inviting, accessible, wry, witty and sharp.
This leads us to believe that Ad Age is going to be less an industry publication than a cultural publication, and we wonder how its core audience, advertising and brand professionals, will respond to that.