Stephanie Famolaro: The elephant in the room in digital advertising — and why we need to talk about it

By Stephanie Famolaro, senior business development director, The Trade Desk

There is an elephant in the room within digital advertising, and it’s worth talking about.

For many years, big tech companies like Google have dominated digital advertising — taking 80 percent of the overall ad revenue in Australia. While advertisers may invest most of their budgets in these platforms, the companies behind them have built walled gardens around their popular search and social media platforms, giving those who advertise with them little insight into their investment, audience targeting or campaign performance. By selling ads on publishers’ websites as well as its own search engine and YouTube, Google is incentivised to spend advertisers’ budgets on itself instead of the publishers who need it to fund the content they produce.

But over the past few years, we have seen growth in alternatives to the walled gardens on the open internet, which comprises the fastest-growing advertising channels like broadcast video-on-demand (BVOD), music streaming, mobile apps, and publishers’ websites.

The open internet has a great many strengths over walled gardens. First, it provides more accurate audience targeting because it enables brands to use their own first-party data to target exactly who they want to.

Second, the open internet provides open and transparent granular insights into omnichannel campaign performance because it enables advertisers to use a single platform to gain a better understanding of how consumers behave across the different channels on the open internet.

And third, because of the reasons above, the open internet makes it easier for advertisers to make budget decisions based on a holistic picture of online media consumption patterns rather than engagement with a single-digital platform. This approach can lead to more comprehensive conclusions about advertising costs, reach, and attention — insights that individual walled garden platforms cannot achieve, no matter how large their user bases are.

But the questions remain: Are you paying attention? What do you support? The walled gardens or the open internet? Aussies have made the call — 76 percent of their time spent online is on the open internet. We’ve also made the call. We’re backing the open internet to make the industry fairer for everyone — consumers, advertisers and publishers. Because the future of trusted journalism, premium streaming TV, entrepreneurship and much more depends on us making the internet better.

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Stephanie Famolaro is senior business development director, The Trade Desk. She is responsible for leading the Business Development team in Australia and New Zealand and spearheading the API/Platform Customisation initiative across Asia Pacific.

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Top image: Stephanie Famolaro