At this point, we’re quite familiar with the major problems that face digital advertising: rampant fraud, wasted budgets, a lack of buying transparency, and now an FBI investigation that threatens to tear it all down (or at the very least heavily regulate it).

Solutions have been disparate and have lacked uniformity, which has frustrated advertisers and stunted the industry’s growth.

The inconsistent application of standards is killing us.

It should be straightforward to give advertisers the confidence that they are getting exactly what they pay for – especially in an age where we track and measure everything. There should not be uncertainty to the question: “how many ads did we buy?”

But who wants to rehash the past? The point is to drive the industry forward with growth and success.

To ensure the future of digital advertising does not reflect the morass of the past, it is critical that we unite around a baseline of standards. For digital advertising standards to work, we need to:

  1. Create an enforceable standard
  2. Have the standard / process be transparent
  3. Have fair and consistent enforcement of the standard

Create an Enforceable Digital Advertising Standard

Standards tell us how to measure something. For example, how do we know when an impression is considered valid? We know because a standard has been established (in this case, by the IAB) that defines the rules for counting valid impressions.

Those rules are as follows:

An Ad Impression across all display marketing channels is the measurement of responses from an ad delivery system to an ad request from the user’s browser, which is filtered for invalid traffic and is recorded at a point as late as possible in the process of delivery of the creative material to the user’s browser. The ad must be loaded and at minimum begin to render in order to count it as a valid ad impression.

If everyone in the digital advertising ecosystem only counts impressions that follow these rules, then post-campaign reporting numbers between partners should match, optimizations are easier to make, fraud and waste are easier to identify, and billing is painless because everyone is working from the same set of numbers.

But if impressions are counted differently by different supply chain participants?

Chaos. Fraud. Basically the state of the industry as it is today.

Creating digital advertising standards historically hasn’t been the hard part. The hard part is getting buy-in from the rest of the industry to use and enforce the standard.

Self-enforcement has proven to be insufficient. Auditing, verifying, and otherwise understanding what is happening is virtually impossible in yesterday’s digital advertising ecosystem. Collecting data doesn’t mean a hill of beans if someone can manipulate the data at their leisure.

Technology, if implemented in a universal format can present a solution, but not unless the process is open for the participants to audit what is happening.

Have the Standard / Process Be Transparent

If you’re a technology vendor, the ability to change the rules to favor your tech company or preferred partners is far too easy and far too common. With a transparent application of an enforceable standard, everyone is aware of when the rules change, everyone is aware of how the rules apply, and everyone has an opportunity to build technology and systems around a baseline that is constant.

In short, this is a golden opportunity to establish a fair playing field for the industry.

Consistently Apply and Enforce the Standard

The standard should apply to every party, every time. If you’re adding value to the ecosystem, you want an established, transparent, and consistent standard. This opens the door for you to prove the value you are generating.

In contrast, you will hate this if you are not providing value. Established, transparent, and consistent standards will expose you.

Which begs the question – why would anyone that adds value to the ecosystem be concerned about an enforceable, transparent, and consistent standard? Simply put, they aren’t. Only those who are afraid to have their malpractice exposed are averse to this path forward.

So how does Lucidity implement enforceable, transparent, and consistent digital advertising standards?

How Lucidity Enforces Standards

The industry has the opportunity to embrace a series of technology techniques that provide the security and confidence lacking in yesterday’s digital advertising ecosystem.

Specifically, enforceable, transparent, and consistent standards may be achieved using:

  1. A Shared Ledger
  2. A Public Blockchain
  3. Universal Transaction IDs

A SHARED LEDGER

A shared ledger is a special type of database/application that nobody owns. The Lucidity shared ledger is more advanced in that it embeds code – called smart contracts – to create the rules for how billing events are processed and computed. Smart contracts cannot be changed or altered by any single party, and they automate the enforcement of data processing rules.

As the name implies, a shared ledger allows participants to share data with one another in a standardized way. It also enables the parties that participated in a set of transactions to review the full trail of data. Having a unified reporting system eliminates reconciliation and billing issues.

A PUBLIC BLOCKCHAIN

A public blockchain enables enforceable smart contracts on a shared ledger. Basically, it adds transparent standards enforcement. Smart contracts act as unbiased arbiters that ingest and compute signals from all members of the supply chain. Based on agreed-upon standards, these signals are judged as either valid or invalid automatically.

Deriving consensus of a shared ledger through a public blockchain also gives the industry permanence of records (sometimes referred to as “immutability”). Permanent records mean that no one can fudge numbers after the fact, and the auditability can be a track record of performance and data.

Fortunately, privacy need not be sacrificed – even when using a public blockchain for permanence – provided you use the appropriate technology to maintain privacy like a private sidechain.

UNIVERSAL TRANSACTION IDS

In Open RTB 3.0, a new concept for a bid request transaction ID was introduced. Otherwise known as a universal transaction ID, it enables an auditing trail that allows you to follow bid requests across the programmatic supply chain.

The universal transaction ID is a randomly generated and unguessable identifier set by a supplier when they place a bid request to demand sources. The point being that we can use universal transaction IDs to audit the trail of ad data needed to compute billing metrics.

Utilizing the universal ID as articulated in OpenRTB 3.0 gives the industry a rallying point and central data-currency to compare apples to apples and otherwise promote a clean ecosystem.

A standard that is designed to be interoperable with today’s programmatic technology should not require any changes to the user’s workflow. The usage of a blockchain should be entirely transparent to consumers and AdOps personnel. AdOps personnel should simply get the assurance of the numbers they work with every day. Participant’s data teams, who are interested, can independently verify the validity of metrics (and *how* those metrics are computed) through the public blockchain.

When it comes to creating transparency, we believe that blockchain presents an elegant, verifiable, and auditable solution. What’s more, we believe that a shared ledger, public blockchain, and universal transaction IDs are the tools to bring that solution to life.

If you’re interested in blockchain, don’t be afraid to talk to an expert first. Or read our handy 101 into-level guide on the subject. Understand what the technology can and can’t do, and you’ll be better equipped to take advantage of something that could truly change how we do business.

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