For the past decade, there have been more than 2000 companies in the advertising industry ecosystem. Each company sought to add a little value to the transaction between advertiser and publisher, but as they proliferated they produced unintended consequences: slow page loads, malware and spyware, bots and popups. Last night, trying to watch a video on NBC.com, Ghostery showed me more than 25 intermediaries between the consumer and the experience. Although everything in programmatic advertising is done within fractions of seconds, the fractions add up and the consumer as begun to notice. Mobile accelerated the problem, since data plans in most countries are capped.
But as the technology keeps advancing, things will get better. First of all, publishers no longer need ad networks to sell ads when people like us have developed private marketplaces where advertisers can buy high quality inventory that is often sold direct.
There’s no need to keep paying middlemen when you can efficiently buy quality inventory directly from publishers via an exchange or private marketplace. There’s been a glut of low-quality inventory running through most exchanges. With advertisers focusing more attention on nonhuman traffic and viewability, the exchanges needed to purge low-quality traffic and inventory and focus on trusted publishers.
In addition to removing middle men for cost purposes, private marketplaces clean up the supply chain, allowing no room for malware, fraud, or piracy. The digital advertising industry, recognizing not only the distrust publishers have for exchanges that drive their CPMs down, and the distrust advertisers have for the opacity of the process, but also the final straw — the refusal of the consumer to tolerate ads on mobile devices to the same degree they did on the desktop. And mobile data plans are only part of it. The industry had to find a better way, and of course ZEDO is already there.