In this week's member guest blog post we caught up with Lisa Kalyuzhny, RVP, Advertiser Solutions, EMEA at PubMatic who takes a look at supply chain transparency and the key topic of sustainability.
Across the digital advertising industry, the conversation about sustainability is growing louder. The terms ‘carbon neutral’ and ‘net zero’ have made their way into our day-to-day vocabulary and as a result, we are more informed and better equipped to understand the steps we need to take to protect our planet. However, we’re still at the beginning of the quest to decarbonise the digital advertising industry and there is a lot of work to be done if we’re to reach net zero by 2030 as pledged by Ad Net Zero and its members.
What are the biggest problems facing the industry today?
Advertising has always been a blend of art and science, and sustainability is a redefinition of the science component of that equation. Sustainability is about creating a thriving economy and society for all, now and forever. Today, the digital advertising industry sits somewhat behind the curve and there is work to be done to ensure that advertising has a role in a net-zero society.
When we hold a mirror up to the digital advertising industry what we see is complexity - a plethora of technology and data companies intertwined with each other, trying to best serve the needs of publishers and advertisers. This complex web of interoperability has also, in the past, suffered from a lack of transparency and brand safety issues. Solving these issues has largely been shouldered by publishers leaving a legacy of ‘responsibility’ for the state of the supply chain.
Today, we need a mindset shift where there is a collective feeling of responsibility throughout the supply chain. We need all parties to work together to define how we can create new values and principles that best serve advertisers, publishers, consumers, and the environment. We need to learn from the past and ensure that no one party in the chain dictates the future and that there is a robust definition of what we’re trying to achieve; why we’re trying to achieve it; and most importantly, how we’re going to measure results consistently.
Steps we can all take now to make advertising more sustainable
First and foremost, we need to ensure we’re not wasting energy which is such a precious resource to society. There are simple rules that can be set such as not buying from one supply-side platform (SSP) via another that you already have a partnership with. This means that energy is not being wasted in an unnecessary hop in the supply chain thus making it more efficient both commercially and environmentally. Implementing changes like this that have a clear commercial and environmental benefit will accelerate the rate of change as there is clear value rather than altruism which is not a long-term solution.
There is a real need for education and understanding across the industry both globally and on a local level in different countries to cater for market nuances and ensure that the best possible approaches are being taken based on individual market circumstances. This education process needs to extend beyond the digital advertising industry and include consumer-focused communications. We need to explain what the issues are, what they mean, what we’re doing, and show the results. This will help build consumer confidence in advertising as a force for good.
The approach has to be systematic and pragmatic - like tidying a messy room. Optimise existing processes, scrutinise the path behind and ahead of you, and ensure that everything works in the most efficient way possible. Look at what you can do now, what you can do in six months' time, 12 months, 2 years, or even 5 years from now. Be realistic about what you can achieve and when and be transparent about it. No one is going to win in sustainability by covering up the truth or pretending to deliver change.
What happens next?
Cleaning up supply paths by reducing hops from advertiser to publisher, the removal of cookies, and responsible use of first-party data will help improve sustainability with near immediate impact. However, we also need to look to the future and what else we can do with a long-term lens.
New companies are entering this space with new tools and solutions designed specifically with sustainability in mind. As industry leaders, we need to ensure that we’re collaborating with these new companies to ensure that best practices are verified commitments and not a race to the bottom or profit-driven. Collectively, we need to keep in mind that no one has a silver bullet which is why we need a common end goal that is robustly defined and well-understood.
The digital advertising industry has been built on technology and more often than not technology companies have been the ones that have stepped up to solve the challenges marketers face. Sustainability is different. Any company that is creating emissions needs to be responsible for reducing them. Regulations similar to the Task Force on Climate-related Financial Disclosures (TCFD) designed to improve and increase reporting of climate-related financial information could well come into play in digital advertising and help guide the way forward.
How to set up for success
Each organisation will follow its own path towards a more sustainable future but there are some factors that will undoubtedly contribute to success regardless of the specific action plans laid out.
Investing in grassroots and engaging people on a personal level through initiatives such as beach or river clean-ups, removing plastics from office kitchens, or providing training on how to improve personal sustainability will help to foster a culture of responsibility and consideration throughout your organisation. Empowering people to think about how they can contribute to a more sustainable future no matter what their job role or level is will create long-term action rather than a tick-box attitude or laser focus only on specific climate awareness days.
Ultimately, the question we need to ask ourselves when it comes to thinking about the long-term is: “How do we make sure sustainability doesn’t become de-prioritised?” Two things are key here - 1) build sustainability and measurement into all business processes, and 2) hire people who care. Doing these two things will enable companies to deliver change both now and in the future. We’re only just getting started on our sustainability journey in digital advertising and there is a lot of hope and optimism that we need to nurture as we go through this radical transformation for good and work to become a net zero society.