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The Future of Digital Advertising

The IAB Annual Leadership Meeting is always a fascinating look at what will happen in the industry going forward, and where the digital media industry sees its biggest threats. In previous years, the threats have included the dearth of dollars going to online ads, and the problem of ads that aren’t visible. Time has taken care of the ad dollar problem, and the visibility problem was solved by the Media Ratings Council’s viewability standards. Both of those were easier to solve than this year’s threat: the potential collapse of advertising as a business model for publishers.

You could see it in the choice of topics for the annual Town Halls, at which the members attending the conference traditionally argue about what positions to take toward upcoming trends. This year’s Town Halls dealt with programmatic, mobile, fraud, and ad blocking. How can you respond to four issues that, taken together, represent the near death of a business model?

Programmatic has always been seen as a potential threat , because as the buying and selling of ads becomes automated, taking the relationships out of the sales process, CPMs for publishers have gone down. Nearly every legacy publisher has had to adapt to revenue declines, and many have been escorted out of business already.

Mobile is a problem largely because of the potential privacy invasions that accompany following a consumer into more private aspects of her life. Data limits and screen real estate accommodations further complicate things for the advertiser.

But the focus on fraud is more surprising, because it has been going on for years and it was in no one’s interest to do anything about it until now, when it represents an $8 billion loss to the industry and the people who pay the bills (brands) have begun to catch on. The effort to clean up the digital supply chain began last year with the launch of the Trustworthy Accountability Group, a certifying body that aims to drive fraudulent players out of the marketplace.

And the fourth focus, ad blocking, is one for which the industry really has no solution, because it is controlled by neither advertisers nor publishers– but by consumers who are sick of slow loading web pages, online retargeting, and unwelcome interruptions. The ad blocking genie has left the bottle, because last year was the first year non-geeks began to understand it.

if you take those four problems and shake them up in a bag with the lack of runway left for many venture-backed ad tech companies you get a recipe in which only the strong survive. As a company that long ago became sustainable, we are happy to watch the action from the sidelines and keep developing user-led ad formats for our publisher partners.

IAB: 2013 THE YEAR OF BRAND ADVERTISING

According to IAB, performance-based advertising has reached the point of diminishing returns for all its players; it has created a highly efficient market in which there is almost no margin left for either publishers or agencies. So this  is the year digital brand advertising can and must be born, or the digital advertising industry can’t survive.

We are part of the IAB because we feel we are aligned with its goals. We don’t just join every organization. IAB shares our beliefs that if agencies are freed to produce magical creative, technology will help them build brands across platforms and geographies. And all this can be measured with metrics that are useful to marketers.

Here is a summary of the IAB Digital Brand Building initiatives for this year.

1. Rising Stars rewards the creative that interacts with consumers right on the page and allows them to engage the way they used to engsge in person. We have to allow agencies to produce better creative — the kind with which people really want to engage.

2. 3MS(Making Measurement Make Sense) is the initiative that began last year to change how we measure ads. Last year, the emphasis was on viewable impressions. Going forward measurements will also include Interactivity, Engagement and any other tangible forms of ad interaction that correspond with results.

3. Advertising Technology and Operations. Deployed well, advertising technologies can eliminate fraud and assure brand safety. But the ecosystem has been portrayed with unnecessary complexity. iAB wants to simplify and lubricate the supply chain. Amen brother.

4. Protecting Privacy. To build brands requires trust, and the industry should collaborate with consumers to combat malware and spyware, and protect privacy through self-regulation. Firefox’s decision to forbid third party cookies is the tip of the impending security/privacy iceberg.

5.Demystifying Dats. Right now, the advertising industry takes more data than it gives, and to be successful we must foster  transparency and trust in the ad value chain.

6.Screens. Simplifying the delivery of ads across devices is critical.Cross-screen research initiatives will quantify the value of cross-screen campaigns and IAB will try to help marketers manage the risks and maximize the rewards of working across screens.

7. Learning and Certification. iAB wants to grow, professionalize and standardize our sales teams, ad ops, and ad technologists so the industry can be taken seriously.

8.Global Brand Building. All brands can and should be global. Digital reaches everywhere, and digital can play both a global and a hyperlocal role simultaneously. IAB plans to help brands be global safely.

Once again, we’re ahead of this curve, already selling our high impact formats and full screen video formats that accept already- produced TV ads on a digital platform. We’re just waiting for you to meet us here in the digital marketing Utopia ahead. How else can we help?