MFA is Programmatic's Dark Mirror

Welcome to another installment of Gareth Hates Ad Tech, wherein I completely unnecessarily make enemies out of people I really do quite like.? If you’re reading this and you feel put on blast, please know that I’m only trying to help make sure that we all have a place in the economy in 5-10 years.? Sometimes a little tough love is necessary. Also, you're all sipping rose and aperol spritzes right now, so don't expect me to have any sympathy for you.

Today’s dead horse that I’m going to reanimate solely for the purpose of sledgehammering once again is MFA.? I know, I know, another article about MFA?? Please will people shut up about MFA???

No!

And I won’t because in my semi-humble opinion, most of the things I’ve read about MFA have completely missed the point.? And just so we get it out of the way, if you’re reading this and you’re an MFA publisher, this article isn’t for you nor is it meant to be a defense of MFA.? So don’t clog up the comments!??

I think the right way, and frankly the only way, to discuss MFA is incentives.

It is my supposition that MFA is not a surprise, is not some “damnable” thing, and is in fact a predictable product of the systems that we’ve created.? Allow me to explain.

If you like this article, please subscribe to my substack! https://www.garethhatesadtech.com/

Cue the Time Machine

I’d like to begin by focusing on something a little different – something I would call the “non programmatic internet.”? These are websites whose monetization methodologies do not utilize programmatic advertising – rather, from their inception, they make money from other means.

This is readily apparent in some of the largest websites out there that conspicuously lack banner ads.? Their business models are simple? :?

1. Content that gets indexed effectively by SEO
2. Layouts, and content, that drive CPA performance marketing (known as commerce, or affiliate)

By performance here, I mean primarily post-click performance advertising – where the advertisers only pay when someone clicks and then does a thing. ? This is because the early ad networks were really built around this, including Google Adsense which still pays out on clicks today, ostensibly because historically those clicks would either lead to outcomes or were the desirable outcome themself.

One of my favorite examples of this type of website is the wildly successful Credit Karma (one I’m intimately familiar with, because within the graveyard of Gareth’s failed tech startups lies credit-authority.com, Credit Karma before Credit Karma was big).

Credit Karma, as a website, is a brilliant example of performance marketing and innovation in upselling products after reviews.? They originally provided reviews of credit cards, those reviews driving users to their site primarily through SEO (maybe they did some paid?? I would love to know if they did…), and if you look at their homepage you can see it’s solely dedicated to driving users to products and to reviews of products (the main button is their in house product, a paid credit monitoring service, and then the little boxes below take you to their reviews of other products) :?

https://www.creditkarma.com/

A nice example of one of these reviews, meant to be discovered via SEO, is one of these, a description of Balance Transfer credit cards?

https://www.creditkarma.com/credit-cards/balance-transfer

In fact, if I type balance transfer credit card into Google, low and behold our good buddies at Credit Karma are indexing really well in the SERP (Search Engine Results Page)?

But the long and short of it is you know what you don’t see on this website?? Banner ads!? Not a single one.? There’s no programmatic here – this site monetizes almost entirely through conversions on their own products or through post-click attributed applications for other products (starting with credit cards, but expanding into other financial verticals).? This is the internet built in the image of affiliate performance – and you can see this methodology implemented in tons of different web layouts.? The page is built for a single purpose – to create clicks on that little continue button to get people to apply for credit cards.

The insight I want to drive home here is that the monetization methodology informs the structure of the website.? A user clicking on information, and filling out an application, is the payable event.? This means this website has evolved in such a way that it maximizes those payable events.

This brings me to MFA.? What is the primary desirable payable event in programmatic for many advertisers?? Now that we’ve moved away from raw impressions or CTR, it’s viewable impressions.

And that’s the outcome that many brands are optimizing towards.? “Here’s an audience, make sure they see my ads per this little javascript measurement I execute” So what do you end up with?

Site’s whose primary existence is to create as many viewable impressions as possible as quickly as possible!? This is not surprising at all.? In fact, it’s stunning that it’s a revelation for anyone.

Note, the optimization goal of “viewable impressions” is not :?

• Viewable impressions with not very many other things on the page (like other ads)
• Viewable impressions on highfalutin content that we think is intellectually stimulating

If it were those things, we would’ve seen websites writing more high-falutin content and ad impressions without lots of other stuff on the page. ? The failure of MFA is not MFA websites.? The failure of MFA is that we built an incentive system in programmatic that essentially necessitated their existence.? And we’re now demonizing websites who were just giving us more of what we wanted and patting ourselves on the back.? Shame on us.

I would say that MFA exposed two negative things while also signaling at least two positive things? –?

As for the negative things :?

1. The outcomes being defined by advertisers were not actually producing results for them (by many accounts, MFA sites looked like they performed great)
2. A bunch of people were not reviewing their sitelists as precisely and often as they could’ve been

Outcomes

It is my firmly held belief that badly structured outcome goals are to blame for programmatic being subject to so much bullshit.? When outcomes are poorly structured, and are not tied to explicit measurements of performance in some way, the industry naturally becomes a hornet’s nest of misaligned incentives and tomfoolery.?

My reasoning here is simple – if the structure of advertiser outcomes doesn’t actually provide growth for a given advertiser, budgets can never increase to that channel outside of essentially arbitrary manipulation.? It should simply never, ever, ever, be a bad thing to get more of your outcomes.

At worst, this is killing programmatic.? It means programmatic is waging a war of reputation, not a war of performance, and after scandals like MFA how could a responsible CMO bet on the open web?? If all they’re looking for is safety, and they can manipulate the data to make whatever channel look like it’s hitting their targets, they’re almost always going to pick the source that appeals to brand recognition – and when Google, Facebook, and big reliable direct sold names exist, open web programmatic is in trouble.? I think that TTD does a great job of branding itself here – but ultimately you are what you eat, and TTD eats the open internet (this is why they have to do all this press about a sitelist – when performance is a commodity, and “branding” is the goal, the number one thing that hurts your campaigns is bad reputational press).? And, by the way, thank goodness that TTD is there to do this – without them, programmatic would be in serious, serious trouble.

At best, these misaligned incentives create wealth for middle men and people who are good at selling the technology that establishes these incentives. ? It is no coincidence, by the way, that the same companies that sell much of the measurement technology responsible for advertisers caring about these outcomes are also the companies selling additional products to cure the mutant offspring of their outcome products.? These non-outcome-producing-outcomes naturally lead to a fixed-pie ecosystem vying for branding budgets allocated not on substance, but on internal marketability.? Because there’s no demonstrable ROAS, there’s no scalability.? I believe that unless we can make programmatic demonstrably more marketable as a portrayer of value when compared to other channels, site owners are going to be stuck fighting like rats over cheese on a sinking ship.?

And an important point here for all of you – if you were optimizing to an outcome before the MFA scandal, and then implemented a blocklist, but you’re still optimizing to the same outcome, I don’t think your campaigns are driving any more value for you than they were before.? Because how could they be – if your outcome was broken on MFA sites, it’s broken on other sites too.? If you’re now implementing a secondary measure to assess the performance of your blocklists…why wasn’t that your optimized outcome in the first place?? If it had been, your DSP would’ve been optimizing to it, and your spend wouldn’t have been allocated to sites that for all intents and purposes were performant in the eyes of the DSP.

Asleep at the wheel - Programmatic’s Albatross

MFA is not a transparency problem.? There is no part of the MFA scandal that was not painfully reportable to anyone with a modicum of experience running a detailed report on the delivery of their advertising campaigns.? And if a DSP withheld this information, that’s profoundly problematic, and really like, not cool dude.? But even if they did, your buy-side ad server should be able to report on delivery, or any of your verification vendors that you’re paying through the nose for, or any of a number of technologies.? I really think the DSPs are the last people in the world to blame for this unpleasant surprise.??

Given this, there are a few foundational pieces of trust that need to exist, per my last article about what to give a shit about :?

1. Advertisers are buying what they bid on, as described
2. Advertisers have the ability to verify after the fact what they bought

Technologically, this is utterly trivial.? It seems to me that there are some business practices at play here, and that have been at play for a long time, that are keeping this from happening – namely, that people aren’t actually monitoring where their campaigns are running and SSPs are sending garbage openRTB data.? And time is not an excuse here – the cost of overseas employees to review campaign delivery is astoundingly low.? And these teams are tremendously capable with regards to campaign management as well – if anyone wants introductions to a few solid firms, I’m happy to provide them.??

But accountability needs to exist, and if you’re a brand or an agency, you need to know exactly where your money is being spent (or at least, what pages are ostensibly driving performance for your campaigns).? If you run somewhere for a long time, and it looks like it’s driving performance for you, the responsibility is yours and yours alone.? TTD is taking a major step in basically reviewing your sitelists for you with their Programmatic top 500 – but once again, they’re doing this to basically do traders’ and agencies’ jobs for them, so now everyone has a “spend more money than you have to, but don’t give me any surprises” button inside of their DSP.

Now, for the positive side of MFA-

I know, how could MFA possibly have a positive side?!? It does, I assure you, it truly does, in fact it probably has more than one.? Here are two I think worth mentioning :?

1. MFA reveals that programmatic budgets are successfully inspiring web evolution, and publishing businesses are capable of evolving to optimize to programmatic
2. There exist economics to funnel traffic out of walled gardens onto the open web that can possibly work

Evolving Internet

Our first example in this article, cited Credit Karma (and the millions of websites like it) of an economic system inspiring the construction of websites.??

MFA is an example of the programmatic ecosystem inspiring precisely the same thing, just for viewability.? The reason this is a good thing is because if we fix our outcomes, it means there are companies out there that will reimagine their businesses to optimize to those outcomes.? That is, as long as we don’t go totally Luddite and move entirely to allow lists.? Rather we need to let the invisible hand of the market inspire new business models as programmatic properly evolves to meaningful outcomes.? This is actually epic.? We just need to optimize campaigns to outcomes that we want, and websites will come into being that drive those outcomes, and the programmatic might see some market share growth.

If you like this article, please subscribe to my substack! https://www.garethhatesadtech.com/

There Exists a non-SEO Publishing Model

MFA sites do not get organic traffic.? But the largest MFA sites were as big or bigger than the largest content publishers on the internet.? That’s an astounding feat.

While bad for just about everyone in the programmatic supply chain, this should be incredibly inspiring for the publishing industry.? This means that there exists a business model wherein content can be promoted successfully with advertising, siphoning very expensive audiences out of places like Facebook or Google Search.

MFA made this work by stuffing tons and tons of ads on the page, which we all know is no bueno.? However, if there exists a way to achieve ROI on users without insane ad to content ratios it means that publishers can effectively convert audiences from walled gardens into consumers of their content by paying for it instead of praying for it.??

This business model is one of the reasons we started Gamera – the way to do this is to measure the lifetime value of users, not single sessions, and to build systems that re-engage users effectively (of course, in combination with providing them with content that they actually want to read) to achieve positive ROI and business growth.? I am firmly convinced that this is the key to transforming online publishing from a dying industry into a growing one.? If you’re a publisher and you’d like to learn more about this, I’m happy to talk to you about it.

Conclusion

So there it is.? And now I get to use the phrase that I’ve been sitting on for months and months? – If you have an MFA problem, MFA isn’t your problem.? MFA could end up being a good thing for programmatic, as long as it spurs reform and innovation in advertiser outcomes and publishing business models.? And please note, this is not meant to be a defense of MFA – there are definitely sketchy business practices there, not in the least bit indicated by it being difficult to navigate to the experiences being sold programmatically.

But if the MFA scandal doesn’t inspire reform and innovation, and it just creates an excuse to slap another vendor layer onto poorly defined advertiser outcomes, it will make our future more dire than it was before.? This would be a regression, not a progression, of programmatic.? And the dire future we would be barrelling towards would not be because we served our brands to some shitty looking websites.