Robert Sawatzky
Oct 11, 2018

Why MediaMath’s open-letter warning to media suppliers is significant

Programmatic platform’s vow to kick out players who game auctions is a rare attempt at industry self-regulation.

Why MediaMath’s open-letter warning to media suppliers is significant

Watch an Olympic diver. She walks onto the platform and exhales. She raises her arms, looks up and concentrates. You see the focus as she mentally prepares in her mind what she needs to do and how to execute the dive. Then, she jumps, followed by a splash and applause.

Now imagine if the next diver took the platform but hesitated, then she was suddenly pushed off the platform by the referee. The splash would again follow, but gasps would replace applause. No medal would be handed out, that's for certain.

Isn’t it so much better to act on your own than be pushed? You have so much more control over what happens next. Yet when it comes to cleaning up the ‘murky media supply chain’ too many industry players have hesitated instead of focusing on what to do about it, then acting. 

We see this now from the DoJ investigation into media rebates in the US. Agencies had two years to respond to the Association of National Advertisers’ (ANA) comprehensive report with firm K2 on the lack of media buying transparency. As R3 principal Greg Paull points out, rather than collectively addressing the issues as an industry, many agencies instead chose to treat the warning as a ‘witch hunt’. 

Now, the FBI is issuing subpoenas to media agencies in response to that report, which Paull notes will be an investigation of global practices. Since Asia is a region where rebates are more prevalent, we can expect Asian marketers to launch more audits and R3 is advising agencies to “come clean”. 

“This is a pivotal moment for the future of the global media industry,” argued Tom Denford, chief strategy officer at UK pitch consultancy ID Comms in its recent video blog. “[The report’s ambition] was to be a catalyst for better collaboration across the industry, to trigger something to happen, maybe to impose some kind of self-regulation to ward off government intervention or interference. But this is probably now an intervention that could have been avoided.”

MediaMath’s open letter

All this prelude brings us to MediaMath’s open letter to its supply partners last week, which was not widely reported. The programmatic industry, as we know, has played a sizeable role among the many other controversies surrounding murky media supply chains. In its letter, MediaMath noted industry challenges have been compounded by ongoing probes of social media platforms, and called on its supply-side partners to think about the consequences of allowing more distrust to fester.

“Although not social platforms, our respective companies happen to be platforms as well, and we each have a critical role in maintaining the integrity of our own market,” the letter states. “At risk is the ongoing sustainability of our industry. We can’t wait for government intervention to bring about true transparency and accountability.”

“Fighting over market share has diminishing returns when the pie starts shrinking due to an erosion of trust. Look elsewhere for an analogy: who ‘trusts’ the cryptocurrency markets right now? We are facing a choice: clean up our act as an industry or hand the keys over to the walled gardens, who can apparently afford to apologise and move on when they experience lapses.”

With that, MediaMath laid out a code of conduct spelling out supply-side abuses it will no longer tolerate and consequences for those trying to manipulate auctions. It’s now asking suppliers to sign a 13-point checklist (see below), threatening any of its members who violate these policies (or their spirit) with being thrown “out of the club”. 

MediaMath's 13-point code of conduct

Unacceptable practices include duplicating bid requests, masking domains, bid caching and misusing wrappers.

Any exchange caught gaming the auctions will be out for “an extended period of time” and only will be allowed back in after extensive vetting. Repeat offenders will be banned for good.

Don't just stand there

Programmatic auction fairness is a very different issue from media rebates, with different levels of prevalence and acceptability. But they’re both hidden thorns in marketers’ sides that continue to perpetuate distrust.

As MediaMath notes, “marketers are tired of games, and don’t want to hear yet another explanation about something obscure…that has inadvertently subtracted value from their marketing efforts.”

Self-policing, many will argue, rarely works, and that certainly will remain true if the night watchmen won’t commit to keeping the lights on. But there have been examples of positive change by agencies and brands collectively tackling problems like ad fraud that can go a long way to rebuilding trust.

The alternative is to face the ire of clients and regulators and to gradually lose more control over how media is bought and sold.

Robert Sawatzky is head of content for Campaign Asia-Pacific.

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