How SPO is driving ad tech’s decarbonization push

“Sustainability” is one of the latest buzzwords in ad tech with it driving many of the public talking points on the contemporary conferences circuit as marketers attempt to define themselves as purpose-driven.

Its newfound status as a cause celebre is in no small part due to the efforts of ad tech veteran, Brian O’Kelley, CEO of carbon emission measurement firm Scope3, who recently told attendees at the Green Media Summit that programmatic advertising has “a huge environmental impact.”

For O’Kelley, the executive credited with coining the term “supply-path optimization,” the concept of shifting ad dollars away from high carbon supply paths to ones that provide fewer carbon emissions is already pushing on an open door.

“We’ve all known about the supply-path issues for several years,” he told conference attendees, adding that “what people couldn’t do for money, transparency or privacy, they might do for saving the planet.”

The spectrum of decarbonization efforts in adtech:

– cut out MFA sites
– buy via direct paths
– buy direct from pubs, no RTB
– use banners instead of video
– use text ads instead of banners
– stop advertising
– shutter business
– reject worldly possessions
– walk into the ocean

— Ratko Vidaković (@ratko) March 30, 2023

Speaking with Digiday, Ratko Vidakovic, founder of consultancy service AdProfs, echoed such sentiments, adding that corporations’ public CSR commitments are “SPO with leverage” as it gives their buying teams an enhanced mandate to pressurize their suppliers.

Ryan Barker, founder and CEO of BERA, a start-up that helps brands measure how they are achieving their CSR goals using consumer panel data, told Digiday that marketers are increasingly likely to insist upon more “carbon-lite supply paths” in their advertising campaigns. This is especially the case as they are better able to correlate consumer sentiments such as “brand love” with sales.

Although for Adform’s Jospeh Dressler, goodwill is one thing, but the industry requires a significant cultural shift for there to be actual change. And it’s one that will test the fortitude of those with responsibilities for revenues on the sell-side of the industry.

“I looked up the last 100 RFPs that we got,” he told Green Media Summit attendees, “it was less than five that had any mention whatsoever of sustainability and green goals… so a brand can say they want to be sustainable, but it has to trickle all the way down to media planning and programmatic for it to have any impact.”

Research from Jounce Media suggests that at least 20% of all ad impressions are traded on several occasions along the ad tech supply chain with middlemen taking a cut of the initial transaction fee, all while adding to the industry’s carbon footprint. Albeit, the question must be asked, will a reduction in the number of ad tech partners result in diminished revenues for publishers?