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Ad tech tackles sustainability

Ad tech tackles sustainability

How to set standards for successful measurement.

Currently, sustainability is a major topic of discussion within businesses and advertising associations. The digital ad industry is working toward more sustainable practices, but it lacks a commonly adopted set of metrics for measuring carbon emissions and use cases for the industry to align on.

During a recent Campaign Tech Talk, technology editor Jessica Heygate moderated a discussion between Krystal Olivieri, global chief innovation officer at GroupM and Choreograph, and Brian O’Kelley, CEO and cofounder of Scope3, about different standards within the industry as well as challenges and gaps within proposed solutions.

Measuring carbon emissions

The UN Climate Change Conference (COP26) and the Glasgow Climate Pact in 2021 has brought the issue of sustainability measurement to the forefront for the industry. Many companies such as GroupM have expressed interest in “decarbonizing the industry and there has been a scramble to understand what that even means,” O’Kelley said.

The good news is progress is being made. The bad news is “there's still a lot of work to be done to get to a baseline where we agree on what good enough is and start doing the real work,” he added. Measurement is imperative “to have a number we can report in line with other sustainability data — manufacturing, packaging, flights, offices and advertising — and to drive reduction.”

When GroupM and Choreograph committed to decarbonizing their media supply chain, they quickly realized that “nobody had ever tried to measure the entire media supply chain across all the different channels to come up with a common methodology,” Olivieri explained. The company invested significant time and effort in creating that measurement methodology.

Reducing the carbon footprint

Scope3 helped GroupM and Choreograph identify hotspots for immediate change through digital and programmatic. First, “minimize the amount of ad impressions spots on a website,” Olivieri said, which not only drives carbon reduction but also results in a better consumer experience. Another quick win is to decrease the number of data tags “to the top three required for business,” she said, reducing “the number of callbacks to the cloud centers and the amount of processing that goes back and forth.”

A brand, for example, will have much more impact by lowering its call volume than by focusing on tweaks to ad creative or the energy from end devices. For publishers, reducing the number of ad tech partners they work with is a way to drive impact.“There's huge electricity investment in data centers spinning up when it comes to selecting an ad whereas other parts of the advertising process contribute fewer emissions in comparison,” O’Kelley explained. “These metrics are so critically important; we have to know what matters because all statistics can be manipulated.”

The reduction in non-viewable ads, for example, can have a meaningful impact because of “the cost of auctioning them into the programmatic ecosystem with zero benefit to an advertiser,” he said. A 30 percent ad reduction would translate to an equal “reduction in the carbon footprint of the internet with no harm to any advertiser.” To Olivieri, that translates to a value add “because they're spending less money on things that no one is seeing and reducing the impact to the environment.”

Agreeing on the taxonomy

The truth is the industry lacks “a common language, based in science, to say what really drives the electricity use and the embodied emissions of the advertising supply chain,” O’Kelley said. Without that, companies “with good intentions will use the wrong data, metrics or statistics and we don't solve the problem even though we think we do.”

A common set of aligned, science-based standards must be “rooted in the driving of reduction, not offsetting,” Olivieri added. GroupM has made progress on developing a methodology and received support from holding companies, trade bodies, clients and partners. However, the competitive nature of the industry ”creates the potential desire for other companies to find the flaws in it,” she said. Ultimately, progress “means that we all have to come together because it shouldn't be a competitive differentiator to reduce carbon emissions across the media supply chain.”

One of the challenges the industry faces is that there are “a lot of vested interests and status quo protection built into it,” O’Kelley said. The truth is “the only way to make marketing sustainable is to disrupt the way we think about it.”

The automotive industry, for example, transformed only when it acknowledged the need to move away from gas-powered cars to electric ones. Once it did, it was possible for the industry to look at the problem “with a different mindset, which doesn't work for the environment, for our future stakeholders,” he said. The digital advertising industry is at a similar crossroads. Acting on sustainability commitments can have a massive impact on the climate while making advertising “more effective and more aligned with the internet that we all want to see and be part of every day.”

Lessons learned and opportunities for growth 

The advertising industry can learn from General Data Protection Regulation (GDPR) as it moves forward with sustainability. While GDPR covered all of the European Union, regulations varied based on the local market and “it wasn't necessarily constructed while consulting the industry on how it could work,” Olivieri said.

As a result, companies “navigated and tested the boundaries and then had to course correct and retest the boundaries.” If media and sustainability experts partner together “to solve the problem with the right expertise, it can help us accelerate the progress that we're making and provide actual standardization in the approach,” she added.

The primary focus of privacy was on media and advertising. “It was almost a direct assault by regulators on the way that the advertising space has worked,” O’Kelley said. Which is why “every single company every single year has to respond to privacy as an existential threat to their business and it's become a dampening effect on innovation.”

With sustainability, the industry has an opportunity to “figure out ways to break the model, to operationalize and drive innovation within these new kinds of worlds,”  Olivieri said. The key is to “to change how we operate collectively.”

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