As seen on AdNews

By Stephen Wright, Programmatic Media


Transparency has already earmarked itself as the issue to dominate in 2017, the debate that was rocketed into headlines by Marc Pritchard of P&G in late January seems to escalate each week.

Discussion on transparency and disclosure are focused on the area of programmatic where in Marc’s words the practices of the supply chain to advertisers have been ‘murky at best and fraudulent at worst’

In managing this supply chain on behalf of advertisers, agencies have provided very limited transparency and disclosure.

There are two clear losers from this lack of transparency and two clear winners.

The losers

  1. Advertisers lose by paying excessive charges for advertising inventory.
  2. Media vendors lose because the share of advertiser revenue they receive is eaten into by middlemen in the supply chain and media agencies. They may get only 40% (or less) of the sum paid by the Advertiser.

The winners

  1. Media Agencies because without having to disclose margins many have been overcharging and making a handsome profit in the area of programmatic.
  2. Middlemen in the supply chain who haven’t needed to fully justify their participation and retained their place by kicking back commissions to agencies or entering into partnership with them.

Stephen Wright is a director of independent agency Programmatic Media.