Adslot (ASX:ADJ) discuss the issues confronting programmatic advertising and safeguards on its platforms


by Jessica Amir

Finance News Network interview with Adslot Ltd (ASX:ADJ) CEO, Ian Lowe.

Jessica Amir: Hello, I’m Jessica Amir for the Finance News Network. Joining me today is the CEO of Adslot Ltd (ASX:ADJ), Ian Lowe. Ian, welcome back.

Ian Lowe: Thanks for having me.

Jessica Amir: The digital advertising world appears to be in a state of chaos. We’re seeing advertisers boycotting, and even media companies entering into litigation with their technology partners. Can you tell us what’s happening?

Ian Lowe: There have been a range of issues that have been reported more recently. They fall into a couple of different categories. Firstly, we’ve seen advertising start to appear next to undesirable content as it relates to the advertiser – they don’t want to be associated with that content. From that, we’ve seen boycotts from some of the world’s largest advertisers in various markets around the world. Secondly, there’s been a general lack of transparency that advertisers are becoming less and less comfortable with – as it relates to the dollars they put into the advertising ecosystem, where those dollars are ultimately pooled with publishers and what margins are being taken by various intermediaries in-between the buyer and the seller. I think it’s important that we understand the range of issues we’ve seen fall broadly into these two categories. But equally, this is all happening within a particular subset of the market – which is a subset of the market that uses technology referred to as ‘real time bidding’, or sometimes programmatic technology, to actually trade the media. So this is programmatic technology that is allowing a buyer and seller to transact the media itself and it’s that section of the market that we’re seeing issues emerge.

Jessica Amir: How has Adslot been impacted by the backlash?

Ian Lowe: Essentially, we haven’t been impacted at all. Adslot’s technology operates in a non- programmatic segment of the market. These types of issues, our clients don’t experience when they trade through our technology.

Jessica Amir: That’s good to hear. What solutions do you think the industry wants to hear to address these problems?

Ian Lowe: In relation to transparency, it’s quite simple. An advertiser needs to be certain that the money they’re putting on the table to buy the media itself is being spent on that media, and that multiple interim intermediaries, even if they are necessarily involved, they can minimise the extent to which they are eroding that budget. They want that budget to be spent on the fullest extent possible on the media itself. So it’s a confidence-related issue around a lack of transparency. Clearly the solution to that is to provide complete transparency. The second issue is brand safety. It’s really about the publisher being able to give confidence to the buyer that their message is going to be consumed in an environment that’s appropriate to the advertiser. There ars really two flavours to the problem here. The first is where an advertiser buys an audience through a programmatic technology and they don’t necessarily know where that ad will ultimately be displayed. It could be displayed on a site that’s entirely inappropriate for the message or the brand. The second type of brand safety issue is where the content that is alongside the advertising is actually generated by the users of the website itself. The recent example is obviously the boycott we saw on YouTube. That’s user-generated content where Google essentially needs to be able to provide a guarantee to the advertiser that the content which sits alongside the ad itself will always be appropriate – or won’t be inappropriate to that message. And that’s a very difficult thing for them to do – even for a company like Google. In fact, many would say it’s probably impossible.

Jessica Amir: That’s really interesting. So how is Adslot placed for these requirements?

Ian Lowe: In relation to transparency, we’re really well-placed. All of the transactions that go through the Adslot technology – the buyer and the seller are dealing with each other directly. So there’s no intermediary, there’s no hidden party in the middle that’s either taking a piece of the budget, or there’s some kind of hidden margin. The buyer transacts with the confidence of knowing that every dollar they spend on the advertising is finding its way directly to the publisher. In relation to brand safety, it’s really an extension of the same dynamic. The buyer is making a conscious decision in advance as to exactly which sites they want their ad to appear on, because it’s contextually relevant and it offers them that brand safety. So they have a relationship with the publisher that they buy the advertising space from, and they know well in advance exactly where the ad is going to appear. There’s an additional point that’s worth making here as well. Programmatic technology has brought some important innovation to the industry – specifically the ability to target users at a granular level. Essentially buy an audience rather than just a placement – in addition to being able to operate at scale, in a way that technology is obviously doing. The Adslot technology offers both of these benefits, alongside the transparency and brand safety, which is clearly an issue in the programmatic world. So our technology allows a buyer to target at a granular level using audience data and it also offers them the scalability that comes through a purpose-built platform.

Jessica Amir: Last question, Ian. What’s your focus for the next 6 months, and long term ambitions for Adslot?

Ian Lowe: We’re working with a range of really large media buyers and sellers around the world – driving adoption of our trading technology. So we’ve got our sights set on a number of significant opportunities with large customers that we’re in the process of closing and transitioning into meaningful revenue. So there ars some significant sales and revenue related goals for us over the next 6 months that we’re very focused on.

Jessica Amir: Ian Lowe, thank you for the update.