Insights ISBA looks into the UK programmatic supply chain, assessing transparency

Contact

Introduction

Early in 2018, ISBA’s Performance and Programmatic Steering Group, representing UK advertisers, posed a reasonable question: what does my programmatic supply chain look like and how can I assess its value in terms of working media?

ISBA together with the Association of Online Publishers (AOP) sought to solve the riddle by launching a forensic end-to-end study, from advertiser to publisher, tracking disclosed media only. PwC was commissioned to connect and audit supply and demand.

Following that, in May 2020, ISBA published an ‘industry-changing’ report in that it initiated the first ever cross-industry critical discussions across all stakeholders – advertisers, agencies, publishers and the ad tech sector itself.

In 2022, ISBA, AOP and PwC joined efforts for a second programmatic supply chain transparency study, designed to test progress since 2020. The report published in January 2023 revealed positive and welcome improvements.

The study collected data from 15 advertisers, 12 agencies, 5 demand-side platforms (DSPs), 6 supply-side platforms (SSPs) and 12 publishers (representing ~£0.1bn of annual UK programmatic spend) in an effort to:

  • identify each element of the supply chain;
  • understand the services and costs at each stage; and
  • map supply chains from start to finish using real market data.

The study took a year to set up and a further year to carry out. The 2020 report which summarised the findings invited trust and transparency across the marketing ecosystem, particularly across the programmatic supply chain, in order to fulfil the promise of programmatic for the benefit of the industry as a whole – that is, the ability to target the right audiences, in the right context, at the right time.

Critical insight, implications and recommendations

Critical insight:

  • Contractual T&Cs and interpretations were inconsistent across all study participants.
  • Each participant had different data definitions, taxonomies and signifiers, retention policies, etc., which delayed the study completion.
  • In enquiring how advertiser spend is distributed across various stakeholders within the programmatic supply chain, it was found that spend representing around one-third of supply chain costs remained unattributable (the ‘unknown delta’), which could be a combination of various things – such as DSP/SSP fees not visible in the study data, post-auction bid shading, foreign exchange translations, inventory reselling between tech vendors etc.. In any case, it could not be determined with certainty.

Critical implications and recommendations:

The industry should help industry bodies and participants (including regulators) to:

  • agree standardised T&Cs for data access and sharing, to be implemented in all contracts along the supply chain;
  • use consistent data taxonomies, definitions, retention, seats and seat IDs, etc. across all supply chain wherever possible;
  • implement robust governance and compliance programmes;
  • access and share their own data (or their client’s data) in a format that can be readily analysed, to facilitate consistent protocols for data sharing and support industry initiatives as a key step towards a more transparent supply chain; and
  • work together to better understand the unknown delta, with the aim of uncovering causes and agreeing industry-wide actions to reduce them.

For more details and access to the 2020 study report please click here.

In response to the 2020 study, the UK Cross Industry Programmatic Taskforce (the Taskforce) was convened, representing advertisers, publishers, ad tech vendors and agencies (comprising ISBA, AOP, IAB and IPA, and individual members, with support from PwC).

The Taskforce set out on a mission to resolve the data access and data quality issues, and to explore, with a view to reduce, the unknown delta percentage for the benefit of all the industry.

As part of that, they released the Taskforce outputs (the Toolkit), to address the lack of transparency in the programmatic advertising supply chain:

  • the Audit Permission Letter (APL) intended to enable DSPs and SSPs to share the data needed for a full financial audit;
  • the Data Fields List (DFL), an agreed list of essential and supporting data fields which will provide the data to enable auditors to match impressions along the supply chain; and
  • the Data Principles Document which summarises how the documents are intended to be used.

In 2022, the ISBA was keen to test the Toolkit and understand whether it could improve programmatic supply chain transparency. PwC collected data from 11 advertisers, 7 agencies, 6 DSPs, 6 SSPs and 10 publishers.

Key Findings

In relation to the APL:

  • it improved data access, which successfully halved the study time to 9 months (vs 18 months first time); and
  • where the APL was used as intended, it operated effectively. However, APL adoption levels varied, alternative bespoke solutions were often required.

In relation to the DFL:

  • it improved data quality in that the participants were able to provide log level data for each impression; and
  • it significantly improved the audit process, with adtech vendors on average sharing ~80% of the requested fields; but
  • some data quality limitations remain for either legal/technical reasons, and inconsistencies in data format (names, currency, device type, etc) and granularity still pose challenges in matching impressions end to end.

In relation to the unknown delta, the higher data quality led to the unknown delta being reduced from 17% of advertiser spend in 2020 to 3% in the 2022 study.

Key Recommendations

The 2022 study report ends with recommendations such as:

  • specific next steps for individual participants as well as the industry as a whole, such as for example that advertisers should consider regular private supply chain audits;
  • that the Taskforce to update its Toolkit, encourage adtech vendors to adopt it, and establish audit protocols for data retention and transfer processes, including real-time checks.

For more details and access to the 2022 study report please click here.

Since the 2022 study report, the ISBA has launched various updates to its Toolkit. It remains to be seen whether another transparency study will follow within the next few years.