Concern over where ads appear online hindering spend, new whitepaper says
It is a problem that has plagued online advertising since 1994, when the first clickable banner ad appeared. Then, as now, ensuring the credibility of online ad platforms can be tricky, and that reality has marketers hesitant to fully allocate online media budgets.
Consider these two scenarios: unbeknown to the client, its web ad is placed on a site adjacent to inappropriate material or, in another case, targets a restricted audience and is construed as off-label marketing. The first case could result in a botched campaign or disastrous brand exposure; the second, possible sanctions for the client.
According to a new survey, pharmaceutical advertisers consider both scenarios entirely plausible, and their concern is limiting investment in online display advertising.
While the amount of lost spend is difficult to pin down, consultancy Winterberry Group estimates that advertisers are deflecting about 10-20% of budgets that could go to display, to other media. The reasons why are explored in a new survey and whitepaper. “People don't trust the display channel to perform; it's not going to be as controllable or steerable as other media,” explained Jonathan Margulies, a Winterberry Group director.
Advertiser concerns are being stoked by the rise of indirect online media buying, which may allow less visibility than a direct media buy over where a message appears and what content will surround it. As online networks that aggregate media buys become more commonplace, Winterberry Group contends, the ad message and its parent brand may be undermined by page-level content that is either objectionable, contradictory or contextually inappropriate.
That was the consensus of dozens of advertisers, agencies and publishers surveyed by Winterberry on the topic, known as brand safety. Though the issue affects marketers across verticals, respondents to the survey said that the brand-safety issue is most relevant in healthcare.
The whitepaper, “Beyond the Grey Areas: Transparency, Brand Safety and the Future of Online Advertising,” and survey—fielded via online, phone and in-person questionnaires—were sponsored by AdSafe Media, a media rating standard of online media, and the American Association of Advertising Agencies (the 4As).
Pharmaceutical brand managers stand to lose not only brand equity from this lack of online-ad accountability but could face penalties, too. “What in another space is simply embarrassing, like juxtaposing your brand or message in front of something contradictory, for healthcare marketers may be outright dangerous and may expose you to potential sanction,” said Margulies.
It's been 16 years since the advent of clickable banner ads, yet online advertising is still a grey zone. Marketers still have no standard way of gauging “transparency”— visibility as to where their brand actually appears—or brand safety—assurance that the content on the page where the ad is placed is acceptable to them, and that the adjacencies are acceptable—before the ad is delivered.
The risk is highest, Winterberry Group says, when ads are bought through ad networks. According to research firm Think Equity, about 90% of online ads are sold through “non-premium” channels—including ad networks, exchanges and other mechanisms designed to automate the sale of Internet media that does not generate enough audience to warrant sales directly through the publisher.
Of that 90%, a significant amount of ad inventory is sold on what Winterberry Group calls an “opaque” basis—advertisers are provided general guidelines about where their ads appear, but are kept largely in the dark about the specific sites or page content involved.
Margulies said that, in healthcare “there are more niche audiences from a pharma-marketing perspective than anywhere else, so the direct buy will be more prevalent.”
Nevertheless, Winterberry Group calls the transparency issue “perhaps the single biggest threat to the long-term viability of the online display channel.”
“More spend has accrued to the channel over the years but, still, our estimates show [online] display will generate less than $10 billion in the United States,” Margulies said. “That's less than TV, print or direct mail, and you can argue that display can fulfill a marketing mission better than any of those channels.”
eMarketer predicts that total US online ad spending (including display advertising, search, e-mail and other formats) will grow to more than $23 billion this year. Providing more transparency and brand safety could add approximately $2 billion annually to display budgets, estimates Winterberry Group, adding that the actual extent of “lost spend” is impossible to measure with any certainty.
On the other hand, figures show that pharma is already a leading advertiser online.
In February 2010, pharmaceutical companies delivered 6.5 billion ad impressions in the US, vs. 4.6 billion in November 2009, according to online metrics firm comScore, putting pharma well ahead of Food and Grocery (2.1 billion) and behind CPG (10.9 billion) in online display ads.
“In terms of broader trends, there are definitely advertisers that are more concerned than others as far as the context of where their ads are delivered, and I'm not surprised to hear that drug manufacturers would want a higher level of assurance,” said Andrew Lipsman, comScore senior director of industry analysis.
However, “I don't have a perception that [pharma marketers are] slow moving,” he said, adding that display advertising by FDA-regulated firms has picked up in the first quarter after a lull. “We've been seeing an across-the-board increased demand.”
As for a lack of transparency and brand safety, Lipsman said that the “vast majority” of pharma's display-ad impressions in February were delivered to well-known publishers, such as Yahoo!, Microsoft and AOL, as well as Fox Interactive Media, MySpace, Facebook and WebMD Health. Associating with top publishers “gives confidence to advertisers that their ads will be delivered against non-objectionable content.”
But even reputable websites can publish material that either contradicts a marketing appeal or fails to live up to the advertiser's acceptable standards, said Winterberry Group. And even some level of unpredictability can be potentially dangerous given the dynamic nature of internet content.
Social media platforms and user-generated forums, Winterberry Group says, can open the door for virtually any internet user to sabotage an otherwise legitimate page of content—as well as the ads that appear on it.
More granular solutions—focused directly on screening, identifying and culling out unacceptable content at the page level—are required to address the concerns, argues Winterberry Group. No single constituency has yet assumed responsibility for this.
Most survey respondents said that publishers and ad networks—the parties offering display media for sale to the marketplace—should bear primary responsibility for delivering a “safe” online advertising environment. But all parties—including agencies, ratings firms, targeting vendors and regulators—have far to go in providing the infrastructure necessary to finally tap the medium's potential.
Respondents suggested that outside technology managers, rather than media providers themselves, could ultimately deliver the appropriate protections needed to ensure platforms are safe for reputable ad messages.
The third party could also manage the service. Ideal solutions, they said, will ultimately work in real-time to ensure that brand-safety issues never actually emerge at the page level. Continued advertiser interest in the display channel can only be assured through protection by these real-time “content decisioning” mechanisms, Winterberry contends.
“Because of the scale and complexity involved in digital media, I'm not sure anyone has had the ability to approach this reasonably,” Margulies said. “But technology is maturing, and this will come into greater focus over the next year or two as these solutions develop further.”