Advertisers seek watchdog for digital domain

A banner advertisement of AT&T on Wired.com (Then HotWired.com) published in 1994 is considered the first-ever digital ad which set off a chain reaction that altered the course of the advertising industry forever. Three decades down the line, digital advertising has not only emerged as the most powerful medium but it is centered around two global tech giants-Google and Facebook.

The rising power of "big tech" (that is how critics refer to Facebook and Google and their related companies such as Instagram and YouTube owned by the two giants, respectively) and their attempts to change the rule of the game, have alarmed the brands and advertisers across the world. The impact is so much so that some states in the US filed an antitrust lawsuit charging Google and Facebook of secret pacts to carry out manipulative practices and data frauds to establish a monopoly in the digital advertising domain. 

Indian advertisers have been talking about the malpractices and data frauds in the digital domain for a long time albeit in a hush-hush manner, not anymore. 

Rahul Vengalil, Managing partner of Isobar, a digital agency that is part of dentsu group, said, “The digital ecosystem is quite complex and several players are involved in consumers’ data collections. Hence, there will always be some variation in data about the reach and impact of the targeted campaigns. Up to 15 percent variation is acceptable. But a third-party audit often throws up a mismatch of 30-40%. This is strange and suspicious. To make matters worse, we have no platform to complain against such discrepancies.”

Considering the size and pace of growth of the digital advertising segment, it's high time to have an industry Watchdog, says Vengalil, adding, “It must be an ombudsman, not a self-regulatory body like ASCI. A watchdog’s order would be binding on everyone.”

Shashank Srivastava, Executive Director, Maruti Suzuki (Sales and Marketing) echoes similar sentiments. “Although Google and Facebook are global companies, India can establish a regulatory mechanism for the digital segment just like the European Union and the United States. We need to understand the international practices too, before coming up with our own watchdog or any other agency,” says Srivastava. 

He further noted, “Transparency is the utmost requirement in the digital advertising segment, not only to maintain the confidence of the advertisers but also for the very existence of these tech giants. How we can monitor and measure transparency, is a matter of wider discussion though.”

It is noteworthy that Google and Facebook alone control nearly two-thirds of the digital ad market in India at present. Their combined ad revenue touched Rs 23,213 crore in 2021. Besides, the digital ad industry is growing at an estimated 20 percent rate annually due to the widespread digital transformation during the pandemic, and changing consumer habits and behaviour. 

Most brands are spending 30-40 percent of their ad budget on digital. However, their trust in the medium is diminishing due to trust deficit and non-transparency. A recent survey conducted among Indian digital media experts by Integral Ad Science (IAS) reveals that “Ad frauds” (invalid traffic, inorganic impressions among others) is a key concern across mobile (78%) and social media (86%) environments. 

Big advertisers have started using verification tools and third-party audits to keep a check on frauds and manipulations in data.  However, most advertisers are still not carrying out these audits as it comes at a premium. This renders the market largely unregulated. 

Lloyd Mathias, Business strategist and former marketing head HP Asia-Pacific, feels India needs to document its own data protection and digital consumer safety ethics, which will drive to clamp down on non-transparent affiliates and publishers behind ad networks including Google and Facebook. 

“India must build and adopt tech-driven digital governance to make sure consumers and their data is safe in the digital environment. Such governance should be self-reliant, non-privatized and built directly by the government, similar to what we did with CoWin. A similar tech for the governance of digital assets is needed,”  Mathias told e4m. 

A global working group for digital, just like M3AAWG, could be an answer, says Shweta Baid, Founder of a digital agency, Shail Digital. “We need a global working group for making digital advertising more transparent and authentic to consumer data. The working group should involve Governments as well as tech giants plus the entire ecosystem representation to offer a trustworthy framework,” Baid suggests, citing the example of M3AAWG (Messaging, Malware and Mobile Anti-Abuse Working Group). 

The group began operations in 2004 as a working group of internet service providers, mobile network operators, tele companies, infrastructure vendors, and anti-spam vendors to fight spam and help protect end-users. 

Divya Dixit, SVP - Marketing and Revenue at ALTBalaji, agrees with Vengalil. Batting for a single digital agency like BARC and said, Dixit said, “The dynamic and ever-evolving nature of the sector does call for strict regulations. This will also ensure that all players are working as per common parameters and there are no gray areas in resolving the crisis.”

India is one of the fastest-growing economies in the world. Hence, keeping Big Tech in check is important and imperative as it can be misused for and by various known and unknown reasons and forces, purposefully destabilizing the growth and harmony in Indian society, says Rajan Das, MD, Apppl Combine. 

Frequent policy updates confuse people

Shweta Baid points out that Google and Facebook keep updating their policies and framework which many advertisers may/may not be “completely” aware of even though they may be spending billions of dollars on digital ads. 

She explains, “A digital advertiser seeks transparency in two aspects – cost and inventory. We need to know where the ad was showing and what was the cost associated with it. When these 2 aspects are clear, then comes the optimisation. Since the ad spaces are now being allocated and sold by automated platforms, it’s very difficult to have complete control of it.” 

Another big challenge is the measurement metric used by the ad platforms. Whether the measurement is done by the DSP directly or does it rely on a third party for providing the key performance metric is important to know, she said. Ad experts also highlight that multiple identities of the same consumers add to the advertisers' woes.

“The very foundation of calculating the effectiveness of the Digital Campaign goes wrong when consumers have multiple identities on these Big Tech platforms. Therefore, we need to do away with multiple online identities of the same person. Only a regulatory authority can ensure that,” Das says.  

Brand custodians & IAB must take a stand 

Ad industry veterans say that brands must also raise their voices against digital frauds. While big brands have started using third-party tools to keep track of consumers' data and ad impressions in order to get a clear picture of their ROI, they are not raising their voices against the monopoly and opaqueness of the tech giants. 

“Brand custodians are the ones who voice matters the most. Hence, they must stand up to seek transparency in digital advertising,” says Vengalil. He also suggests that the Interactive advertising bureau (IAB), which had earlier set benchmarks for the digital advertising domain, should also take cognizance of the matter and set some benchmarks for consumers' data as well.