2020 Digital Ad Industry Sets Records, But Don't Relax Yet

There’s no need to state the obvious about 2020. It was historic, and I don’t mean that in a good way. But there’s always a silver lining, even in the most trying of times. For the digital ad industry, that silver lining shimmered like the sun.

2020 was the first time digital advertising accounted for more than 50% of all ad revenue, growing at an estimated 6% in the US while total US ad spend fell by 8%. Those statistics are genuine reasons for optimism and pride, two traits that were the rarest of commodities in an otherwise bleak year.

But before we all start popping bottles of champagne and patting ourselves on the back, the risk-assessing CEO in me can’t help but issue a warning to the digital ad industry as we look toward a bright future:

Don’t rest on your laurels or take things for granted because this golden opportunity still sits on precarious, shifting ground.

The Bad Guys Don’t Stop (But Neither Do We)

Yes, the ecosystem proved to be remarkably resilient last year, and that’s great. However, revenue streams don’t exist in a bubble, so while digital advertising stepped into the spotlight in 2020, Ad Lightning saw both the number of threats and the sophistication of bad actors increase last year.

Malicious ad campaigns, mobile redirects, and other tools of the malvertising trade all grew in 2020. And as we discussed in our blog last year, few things can torpedo a brand’s reputation faster than bad ads and the fraudsters behind them.

It’s Not Just a Publisher’s Problem

Just as importantly, consumers don’t care where the issues come from along the digital ad supply chain. They blame the publishers for poor ad quality, malware, and inappropriate content, even when they start upstream.

Obviously, that’s reason enough for publishers to stay ever-vigilant against things like redirects. However, as we’ve said before, publishers aren’t alone in the battle for ad quality, so SSPs and DSPs are just as much on the hook. In fact, our 2020 State of Ad Quality report found that two-thirds of publishers have turned off upstream ad partners over ad quality issues.

But that’s why we’re always pushing forward at Ad Lightning, improving our already industry-best ad quality solutions to give our partners – publishers and platforms alike – convenient tools that work, no matter how advanced the bad actors get.

Effective, Evolving Solutions

For example, look at the patent we received for mobile redirect detection to see how Ad Lightning stays ahead, not to mention our pending patents and constant innovation. Collectively, this is what keeps us on ad quality’s cutting-edge and drives us forward. We understand that there will always be newer, hungrier, smarter groups of fraudsters bubbling to the surface, ready to take away your success.

However, “staying ahead” isn’t just about blocking malvertising but, instead, a holistic approach that includes other critical tools like categorization as well. To that point, given the success we’ve had in blocking bad ads for our partners, many have circled back around to focusing on improved categorization and customized blocking. Naturally, our sophisticated filters accomplish just that for Ad Lightning customers, no matter where they are along the supply chain.

Privacy Concerns Take the Pole Position

At this time last year, our 2020 State of Ad Quality report found privacy-oriented compliance issues to be the top concern for the industry. Like it or not, despite a tumultuous 12 months, it turns out that those concerns were warranted.

Of course, such compliance issues are just as threatening to the industry as poor ad quality, a notion that will only intensify with time. And we don’t have to look any further than California to see which direction the compliance winds blow.

Although CCPA took the privacy baton from GDPR and ran with it, Californians still weren’t content. Hence, we now have the CPRA – a major upgrade to the CCPA – that places ubiquitous retargeting techniques squarely within its aim. I probably don’t have to tell you that where California goes, the rest of the market goes, so legislation similar to CCPA and CPRA is bound to become more commonplace in coming years.

Unfortunately, while third-party consent management platforms (CMPs) ostensibly keep companies on the right side of the GDPR regulations, research from MIT shows that less than 12% of CMPs meet even minimal compliance standards.

Obviously, that poses significant issues for companies looking for effective compliance solutions. However, although CMPs are at best a work in progress, compliance is yet another area where Ad Lightning will soon be at the forefront, helping companies navigate these dynamic waters, stay compliant and, most importantly, protect the privacy and first party data of their other users.

Final Thoughts

My intent isn’t to be overly harsh with the digital ad industry in these words. To the contrary, I’m extremely proud of everything this ecosystem has accomplished, particularly during a treacherous 2020. And I’m equally proud of Ad Lightning’s ability to help our partners weather the storm, address the many varieties of bad ads head-on, and continue to prosper.

My concern is that not enough companies will adopt the tools they need to succeed, a patently lead a horse to water type of scenario. But Ad Lightning will always do our part. And this time next year, I hope I’m writing a similar piece on what the digital ad industry must do in 2022 after yet another record-breaking year.

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