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The Truth About Ads.txt: The Injustice of Transparency

The Truth About Ads.txt: The Injustice of Transparency

5 Minute read

This article is rescripted from the original presentation by Lior Shvo, Managing Director, at AdMonsters Publisher Forum San Diego, on November 9, 2021.

To eradicate fraud, all parties must fight it equally. Assuming that the incentives are equal and no one wants to have their revenues stolen from them, the tools to execute this need to be equivalent too. But while buyers have it integrated into their DSPs, and SSPs enforce it, ads.txt came with no tools, automation or best practices for publishers. Even if they implement the file correctly, they are left with questions about maintenance, risk exposing themselves to fraud and malpractice, and need to invest many resources in cleaning up.

How did we end up here?

In January 2017, Marc Pritchard went on stage at the IAB ALM and called the supply chain "crappy." Urging marketers to act, he said, "We realize there is no sustainable advantage in a complicated, non-transparent, inefficient, and fraudulent media supply chain."

It led to the creation of ads.txt by the IAB Tech Lab, a tool designed by buyers for buyers to enhance their control over the supply chain, by verifying that they only buy from authorized sellers. By implementing this information into their SPO process, they can decide whether they buy directly from the publisher or from resellers of the publishers' traffic.

It was supposed to offer a balance, give publishers a tool and align buyers and sellers. But the truth is that five years later, the supply chain is still crappy, and ads.txt hasn't delivered on a perceived notion that it would be the silver bullet to clean up the industry. The concept was good, but it is not a single-source solution. So, what are the truths and injustices about ads.txt that affect publishers, adops, and other industry members, and more importantly, what can you do about it?

The story so far

In 2017, I worked for UM (Universal McCann) Tel Aviv, as Chief Strategy Officer, managing digital media for my clients and buying from platforms like Google, Meta, and DV360. Brand safety and transparency were non-issues, solved with outsourced technologies, like Moat for viewability and Double Verify for verification. Ads.txt was fully integrated into our DSP, helping us make better buying decisions. From my perspective as a media buyer, I thought it was covered, and the programmatic supply chain had dramatically improved.

When I moved to Primis in early 2021, my eyes opened. That wasn't the case at all.

Research published in 2020 showed that for every $1 an advertiser was spending, 15% was lost on its way to the publisher. That's how high the price of fraud is. But it's not only advertisers' budgets that are missing! It's taking money out of publishers' pockets too. Instead of receiving a potential $0.66 per dollar, the publisher gets 29% less, only $0.51!

For publishers, ads.txt is the gateway to selling their inventory. When they start working with a new vendor or an existing vendor sends additional lines, publishers should be updating their files. However, our recent publisher survey showed that 48% don't check new lines from their partners before adding them, and 71% don't remove the lines from partners they no longer work with.

Exposing your inventory

Vendors are aware of these loopholes and take advantage. Over the past year, we've helped dozens of publishers clean up their ads.txt files and have seen firsthand the explanations vendors give publishers for the incorrect and sometimes fraudulent ads.txt lines they send.

Two common errors in publishers' ads.txt files stood out; vendors listed their lines as Reseller instead of Direct, misrepresenting their relationship to buyers, while others sent hundreds of additional unverified lines.

When publishers contacted vendors about it, they were met with defensive responses and claims that removing or changing lines would damage their revenues, the worst threat a publisher can get.

With no tools or best practices in place and the threat that their bottom line is at risk, publishers react in two radical ways: some refuse to work with resellers what so ever, missing out on innovation happening in the market, and others have FOMO (fear of missing out), so do nothing. Their ads.txt files are hundreds, even thousands of lines long, rendering them useless and letting hidden sellers access their inventory.

Hiding in the crowd

Every time we meet with a publisher, before we run the Sellers.guide analysis on their domain, we ask them how many programmatic sellers they are working with? When I say a seller, each seller represents a check you should receive. The reality is that we see a 30% gap between the number of sellers the publisher thinks they work with, compared to the real number of sellers authorized to sell its inventory. Hidden sellers cause latency, clickjacking, mobile redirects, and many more problems.

80% of publishers say they work with up to 34 sellers

It's a vicious cycle

A lack of tools for publishers causes a lack of maintenance that creates FOMO - and hidden sellers and fraudsters are thriving. While buyers have their solutions, publishers are left paying the price.

We saw the injustices up close when helping our publishing friends clean their ads.txt; the lengthy files, and the performance issues and realized the problem is deep-rooted and hurting publishers.

For example, we helped Investing.com reduce their ads.txt lines from 3400 to under 200. The process was long and tedious, but the results were worth it. Afterward, they reported a large improvement in latency, a spike in eCPM, and more.

It's time to correct the injustice

Primis has been developing tools for publishers since 2007. We launched Sellers.guide last year, the missing free tool for publishers -an automated tool that makes ads.txt more accessible, saves resources for the ops teams, eliminates hidden sellers and helps publishers reclaim some of the lost 29% in revenue.

We hope that by shedding light on the supply chain and helping publishers to find out who is really selling their inventory, the balance in the industry will be restored.

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