Why responsible advertising is good for your bottom line

It’s not just for the greater good – your P&L will benefit too. Jeremy Arditi, chief commercial officer at Teads explains all…

CPMs, GRPs, ROI and MMMs have been the dominant factors behind large scale media-buying decisions for decades. This year, on an unprecedented scale, the buy-side has also been evaluating the (perceived) moral values behind the platforms they buy from and the societal impact their advertising spend may have. There have been several calls in the industry for more “responsibility” in media buying. For example, the Global Alliance for Responsible Media (GARM) has created uncommon collaboration from all sides of the ecosystem to address consumer and brand safety issues stemming from user-generated content platforms. IPG has also launched its framework for Responsible Media.

Holding ourselves accountable for the societal impact of our industry seems important for the greater good but will it help move more cars and sell detergent? Whether you believe that social platforms are rightfully acting in defense of free speech or they are shamefully propagating extremist views, is not really my business. I have come to the conclusion that you need not find your inner altruist for responsible advertising to make sense.

What is responsible advertising? There are a variety of definitions but let me propose the tenets below and my case for why each of these has significant business implications:

Support quality journalism and publishers
The importance of funding quality journalism and news from a societal viewpoint has been argued by several leading voices in the industry such as Lou Paskalis of Bank of America and John Montgomery of GroupM. Shorthand, the simple equation is something like No Ads = No journalists = bad for democracy. But perhaps saving democracy is something you can push back to next quarter. In the meantime, you’ve got cars to move, soap to sell. So let’s explore why supporting quality journalism is good for business. A highly competitive landscape where a multitude of media owners compete for ad dollars not only diversifies strategic risk for the buy-side but puts more pressure on suppliers to evolve and provide better service and pricing. Put simply, greater competition amongst media suppliers benefits buyers.

Avoidance of willful misinformation and hate speech
Rampant misinformation continues to plague UGC platforms and despite efforts to clean up their act, social platforms remain a propagandist’s dream come true.

Why is avoiding adjacency to misinformation good for business?

Brand equity is built on trust. Associate your brand with significant volumes of misinformation on platforms where this is challenging to control, and customers or prospects won’t be able to make heads or tails of your brand claims. In their article, “Fake News, Real Problems for Brands” published in the Journal of Interactive Marketing in 2019, researchers found that “the negative associative impact of fake news is not confined to perceptions of brand trust, but extends to managerially relevant outcomes such as consumers’ intentions to purchase, spread word-of-mouth, or visit the brand’s store.” The Edelman Trust Barometer of May 2020 places traditional media at an all time high of 69% while social media is a full 24% points lower.

Clean advertising, objectively measured
This specific principle of responsible advertising is all about good business. Clean advertising is shorthand for ads that are actually seen by humans in brand safe media, independently verified and where results are objectively measured. While the business implications of buying fraud don’t need much of an explanation, there remain many gray areas in digital advertising hygiene. Take attribution models for example, many do not consider whether an ad has actually been seen, but only consider whether it has loaded on a page. So an advertiser might be duped into believing a specific media partner performs well when in fact their ads are never actually seen. While the industry has come a long way on hygiene challenges, many issues persist.

Respect for the user
While there has been less discussion about them recently, ad blockers remain a challenge for the industry. A June 2020 study by Global Web Index indicates that up to 47% of internet users now use ad blockers. This is perhaps the biggest medium term threat to the digital advertising ecosystem. The buy-side should exert pressure on demanding less clutter. The long-term sustainability of the media ecosystem depends on respecting users with polite yet engaging ad experiences.

What’s the business case?

First of all, if you want a job in digital media in three years, pay close attention to what’s happening here. As an industry, we get caught up in our jargon and our headaches but we tend to forget that there is a person (hopefully not a bot) behind each cookie and each user ID. If we don’t have more respect for that person, there will be no way to reach them in a few years.

Partner for lasting industry and societal change
In recent months, pressure has mounted on companies to accelerate their diversity and inclusion programs. Outwardly most people will agree the need to do so is self-evident and “the right thing to do” but if internally you feel like rectifying issues of discrimination is beyond your control and sphere of responsibilities, be selfish and consider the business case. Others such as the The World Economic Forum have documented that “the business case for diversity in the workplace is now overwhelming.”

So when can you expect the business payback from responsible advertising? Much of it is immediate. Listen carefully, procurement teams. Investing in quality journalism, contrary to popular belief, can be done at a fraction of the price of many of the User-Generated Content (UGC) platforms, particularly if you measure on attention-based metrics. Increasingly, publishers are equipping themselves with the data and optimization capabilities that allow them to effectively compete for performance with UGC platforms.

Now is the time to advertise responsibly and bring your colleagues along for the journey not because it’s good for society but because it’s good for your P&L.

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