Date posted

26 Jan 2023

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What can we learn from ISBA’s programmatic supply chain report?

The latest programmatic transparency report  from Incorporated Society of British Advertisers (ISBA) and PriceWaterHouseCoopers (PwC) shows a step change in the right direction, but there’s still a journey ahead.

Released last week, this is the second report on this topic from ISBA and PwC, with the first edition in 2020 suggesting that less than half (49%) of all ad dollars spent in an audit they undertook of the programmatic supply chain ended up with the publisher. The results reported that 15% fell into “the unknown delta”, meaning that the end destination could not be determined. This, quite rightly, caused concern across the industry from advertisers to ad tech vendors. 

The new study, which took nine months to execute (in comparison to 18 months for the first report) shows that a much-needed change has occurred in the last  two-and-a-half years, with more standardised reporting, greater buy-in from partners across the supply chain, and crucially, more positive findings across the board.

Key findings

  • Match rates (the percentage of users from an audience segment that a demand-side platform is able to recognise) has increased to 58%, compared to 12% in 2020.
    • The 42% that couldn’t be matched was due to the technical inability to do so rather than information being withheld.
  • Unattributable ad spend (or “ the unknown delta”) has reduced to 3% compared to 15% in 2020. 3% is less ominous than it sounds and can be attributed to factors such as Forex (the buying and selling of global currencies).
  • Publisher take rate (the fee charged by a publisher on a transaction performed by a third-party seller or service provider) is up 8%.
  • Match rates in Private Marketplaces (PMPs), in which a publisher only makes its inventory available for select advertisers to bid on, and marketplaces are much higher than in the Open Ad Exchange (an ad buying and selling space that is open to all).

It is worth noting, however, that of the 1.3 billion impressions analysed, only around 12% went into the 10-12 publishers the study worked with. When auditing, we are still looking at the top end of programmatic inventory, and less at the longtail.

Despite the encouraging results, there is more to be done to make auditing the financial transaction a standard operating procedure. It is important this acts as a signpost to where we should continue to move.

How can this improve further?

Whilst the increase in match rate and the reduction of “the unknown delta” is progression, advertisers and agencies must still continue to find a better way to increase transparency, reportability, and accountability in programmatic advertising. To start, we recommend the following:

  • Work closely with your supply chain to form partnerships based on ongoing value exchange rather than transactional exchanges.
  • Work with fewer partners and create your own buying environment.
  • Persevere with partners to receive and use log-level data where available for auditing impression matching.
  • Work towards your defined Supply Side Optimisation (SPO) best practices.

If you have any questions on this new report or your programmatic buying practices, our team can help.