Sustainability: Enhancing Programmatic Advertising Efficiency
Did you know that the internet has a larger carbon footprint than the airline industry? And it will even double by 2025.
No wonder sustainability in AdTech has become one of the most important industry trends in 2023. Although the digital ad industry is working towards more sustainability practices it lacks a commonly adopted set of metrics for measuring carbon emissions.
In a panel discussion in Cannes, our CRO, Chen Shalit, shed light among other industry experts from Beeler.Tech, HUMAN, Butler/Till, Scope3, and Verve Group on the ongoing efforts within the AdTech industry to address sustainability concerns and the potential for further advancements.
In this blog we wanna share some takeaways from the panel discussion as well as dive into how supply path optimization (SPO) promotes sustainability in the digital advertising ecosystem.
What is Sustainability?
Sustainability refers to the ability to maintain and improve the well- being of present and future generations. It encompasses three interconnected pillars: environmental, social, and economic.
Environmental sustainability: By reducing the negative impact of human activities on the environment, such as minimizing carbon emissions, saving energy and water, mitigating climate change, and much more, environmental sustainability focuses on protecting and preserving natural resources and ecosystems.
Social sustainability: This aspect of sustainability focuses on creating equitable and inclusive societies that prioritize well-being and justice.
Economic sustainability: By focusing on promoting a healthy and resilient economy, supporting long-term prosperity, economic sustainability involves fostering economic growth while considering the efficient use of resources and promoting responsible consumption and production patterns.
Sustainability in programmatic advertising
In the US alone, data centers are responsible for 2% of the country’s electricity use. This calculation doesn’t even take into account the energy that’s needed for data transfer and end-user devices.
In programmatic advertising, carbon emission occur at different parts of the digital supply chain. Imagine that 1GB of data generated from digital advertising is the equivalent of 1 kg of CO2 emissions.
This means, a global advertiser who buys 40 billion impressions of programmatic advertising each year would emit approximately 8000 tonnes of CO2 annually. That’s equivalent to the CO2 emissions generated from the production of 200 million plastic bags.
The single use of plastic bags has been banned in eight US states, but does that mean that we need to ban advertising online. Of course not, but we have to find more efficient ways to place advertisements.
To do so, we’ve put together a list with three game-changing insights on how to place online advertisements in a more efficient way.
The right balance
Finding the right balance translates into efficiency which is crucial for success. Thus publishers face the challenge of effectively managing their campaigns while optimizing resources and minimizing costs.
This means, publishers need to prioritize efficiency by implementing Supply Path Optimization (SPO) strategies. By doing so, they can intelligently streamline their campaigns and make the most of their available resources without compromising on stakeholders.
SPO is a data-driven strategy that enables publishers to optimize the path between advertisers and publishers by filtering out excess participants and fees. Without SPO, your programmatic ads can make multiple stops, resulting in higher costs while increasing your digital carbon footprint.
Direct emissions from assets that a company owns (factories, vehicles, etc.)
Indirect emissions (running offices, business travel, etc.)
Emissions created by vendors, advertisers, and publishers using DSPs, SSPs, etc.
Added value will be key
Another way in being more sustainable could be added value. This brings more efficiency in terms of contextual advertising, geographical area, or field of proficiency.
Contextual advertising: Contextual Advertising can be used with Programmatic Advertising and Managed Services Campaigns. Contextual advertising works by scanning content and websites for keywords and serving ads that are relevant to those keywords.
Geographical area: Let’s say you just entered the Japanese market and planned your first ad campaign. Well, you might want to precisely target a precisely defined audience in this specific geographical area. In this scenario it might be helpful to work with an additional stakeholder who has a lot of experience in this specific geo.
Field of proficiency: Every stakeholder you work with brings something unique to the table. Of course there are some that don’t add extra value. But sometimes it’s good to work with an extra stakeholder who has a proficiency in a specific field for example cookie sync.
Urgency for standardization
Currently, there is no unified standard for tracking carbon emissions across the supply chain. Understandably that publishers might be tempted to prioritize other issues, such as privacy or ad fraud over sustainability. Nevertheless, improving standardization translates into more efficiency.
Make sure your partner is using globally recognized standards. This makes it easier to substantiate claims when quantifying sustainability improvements for the larger organization.
How sustainable are you?
There are several ways to reduce carbon dioxide emissions and with it the carbon footprint of a digital ad campaign. Please contact us if you have any questions or wanna learn more about sustainability.