Web Publishers, Ad Nets at Odds

Recently, an advertiser received details on an online ad campaign delivered by the ad network interCLICK. The site list seemed ideal for the client’s financial professionals target: Bloomberg.com, TheStreet.com and The Wall Street Journal’s site. There was only one problem: interCLICK isn’t authorized to sell any inventory on any of those sites. In fact, none of them sell inventory through any ad networks.

Yet executives at interCLICK, a publicly traded company, insisted these publishers are dead wrong. They claim these sites sell inventory either through ad exchanges or third-party yield optimization firms like AdMeld or The Rubicon Project — from which interCLICK can then purchase and resell.

That, said the publishers, is impossible.

Someone is fudging the facts. And while this incident may represent an extreme example, it highlights a problem plaguing online advertising. Many top Web publishers claim they continually encounter ad networks that misrepresent what sites they are authorized to sell. And they note the problem is escalating as the cluttered ad network space comes under more scrutiny by ad agencies.

Michael Katz, interCLICK’s president, was adamant his company had done no wrong. For example, he claimed that interCLICK was able to purchase inventory on WSJ.com through Google’s ad exchange. “The issue is, when many publishers think they are not working with ad networks, they’re opening up their inventory to exchanges and publishing optimizers,” said Katz. “Everybody likes to vilify ad networks and say they don’t work with them. They do — just not directly. We would never represent working with someone we don’t work with.”

However, sources told Mediaweek that an interCLICK executive privately admitted to a buyer that the company had doctored a report for the financial services brand and then blamed a junior-level staffer for it. Indeed, the performance report provided for that campaign contains several dubious entries, including the URL wallstreetjournal.com being listed rather than WSJ.com. Also, several sites are listed as brand names, not traditional URLs.

“We’re definitely not faking any report,” responded Katz. “That is a preposterous claim.”

Trevor Fellows, Bloomberg’s head of global media sales, shot back that interCLICK’s report is inaccurate. “We’ve said categorically that we are not [using networks or exchanges],” he said.

Similarly, Tom O’Regan, TheStreet.com’s svp of ad sales, said there is no way that interCLICK could have sold any of its inventory. “Over the past few years, we have had a policy where we work with no ad networks,” he said. “Yet we continue to hear from buyers that networks are promising to sell inventory on our site. In some cases, we have had to get our legal team involved.”

Many publishers report having to regularly issue cease-and-desist letters to ad networks. In the past year alone, such letters have gone out to Tribal Fusion, Undertone Networks and TidalTV. Executives at both Undertone and Tribal Fusion said that they had mistakenly referenced TheStreet in their documents and that the errors were immediately rectified. TidalTV execs characterized it as a “misunderstanding.”

“We respect publishers direct sales channel and work hard to protect it,” said Undertone CEO Mike Cassidy. “Clearly, there is more work to be done industry-wide.”

But sellers, and even some buyers, doubt such incidents are true mistakes or onetime incidents. “I’ve seen our site listed as a publishing partner, and we haven’t even had a conversation with that network,” said Brian Quinn, vp, ad sales and marketing, Wall Street Journal Digital. Often networks defend themselves by claiming they provide many buyers with a “theoretical list of sites where your ads might run,” he added.

It’s that sort of game playing that recently led The New York Times Co. to stop working with all ad networks. According to Todd Haskell, vp advertising, the Times constantly was issuing its network partners warnings or suspensions — even threatening frequent rule violators with a complete severing of business dealings. “You’d be surprised at how many people reach the death penalty,” he said.

Going forward, the Times plans to be vocal about its avoidance of ad networks. But that won’t necessarily stop the games, argued Mary Bonomo, associate director, strategy and communications, Merkley + Partners. “There’s currently no transparency that exists,” she said. “Ad networks are continuing to misrepresent their site lists and media placements. There needs to be a third-party auditing system in place.”

It’s an idea many publishers echoed—that the industry universally adopt an ad verification technology platform such as those offered by companies like AdSafe or DoubleVerify.

(Curiously, just last week interCLICK announced it is now working with both companies.)

But other publishers are clamoring for trade organizations like the Interactive Advertising Bureau to take a more active role. “This is a serious problem in our industry and one that needs to be addressed in a way that gives publishers more protection,” said TheStreet.com’s O’Regan.

Some publishers grumble that the IAB may be hesitant to take sides since so many ad networks are dues-paying members.

Randall Rothenberg, IAB president and CEO, bristled at the notion, pointing out that 46 percent of the IAB’s board consists of pure publishers while just 26 percent consists of networks, blogs and portals. Plus, he noted that the IAB has established a committee tasked with developing compliance standards for ad networks and exchanges. “We’ve bent over backwards,” said Rothenberg.

As a nonprofit, though, the IAB has limited enforcement power, he acknowledged: “What we can do is try to create a better environment for our members to drive growth.”

“The IAB is a big tent,” Rothenberg added. “Like any trade association, our members compete with each other. Sometimes they compete very vigorously.”

But perhaps some of the burden should be placed on digital agencies. After all, no one is ever forced to buy inventory from an ad network.

“This is an unfortunate problem within the industry. A few bad apples can ruin a bushel,” said Pam Horan, president of the Online Publishers Association. “Marketers need to think about where they want their ads to appear and decide if they want to sacrifice efficiency for quality. In order to ensure brand protection, marketers need to give serious consideration to the impact of their media buying and planning decisions.”