Programmatic advertising is set to be defined by declining addressability, brand safety and ad fraud over the next 12 months, with WARC’s latest ‘Future of Programmatic’ report spotlighting numerous concerns.
The news comes as a clear majority (60%) of advertisers and agencies cite brand safety as their top concern, with recent reports indicating that advertisers are sinking millions into low-quality ad placements that violate brand safety standards by being placed next to potentially racist or harmful content.
Although Google has opted not to phase out third-party cookies, the tracking tool is still set to play a significantly diminished role. WARC says advertisers are still not prepared for this change, with only 25% of respondents believing that they are making adequate progress on areas such as targeting, data access, audience segmentation and measurement.
Promisingly, over three quarters (76%) of respondents said they were taking steps to implement first-party data strategies as the industry moves into a more privacy-focused marketplace.
These positive steps come in contrast to the ad fraud and wastage affecting the industry, with many failing to take action on their media supply chain transparency.
Currently only 28p of every pound spent on programmatic advertising reaches the consumer, with a quarter of the £67 billion allocated to open web programmatic ad spend wasted on low-quality and fraudulent impressions.
Despite the ongoing global climate crisis, emissions reduction is not a priority for most (59%) companies involved with programmatic advertising. Less than a third (31%) said they had adopted a framework or set of methodologies to measure the carbon emissions from their digital advertising.
Subscribe to Marketing Beat for FREE
Sign up here to get the latest agency-related news and more sent straight to your inbox each morning
A further third (34%) admitted have taken no action at all to reduce the carbon impact of their programmatic advertising campaigns, despite the programmatic industry industry producing more than 215,000 metric tons of carbon emissions in a single month across five leading economies.
“Some advertisers are using their media agencies to forecast carbon emissions on their media plans,” ID Comms senior consultant, Mark Andrews said.
“This is educating planners and buyers and helps media teams think about carbon emissions as well as considering how practical decisions at the planning stage could lower emissions, without negatively impacting the effectiveness of media planning/buying.”
The decrease of investment on the open web is also beginning to prove cause for concern as advertisers increasingly opt for walled gardens such as Meta, Google and Amazon, despite the public spending most of their browsing time on the open web.
Alarmingly, WARC predicts that just five platforms will take over half of global advertising spend across 2024, with three-quarters of survey respondents (76%) saying that they are now spending 40% or less of their budgets on open web advertising.
“Our Future of Programmatic report arrives in the wake of the announcement from Google that third-party cookies will no longer be fully phased out from the advertising ecosystem. While it represents a reversal of sorts, this should not encourage complacency,” WARC managing editor research and insight, Paul Stringer commented.
“Declining addressability, brand safety and ad fraud, continue to concern marketers, and addressing these concerns becomes even more important as increasing volumes of spend are transacted programmatically each year.”
