The Ad Tech Vendors Helping Programmatic Go Green - AdExchanger

by Allison Schiff // Friday, April 22nd, 2022 – 11:16 am

The term “sustainable marketing” calls to mind disposable bamboo razor handles from Schick, the promise McDonald’s made last year that by 2025 all Happy Meal toys will be made from environmentally friendly material and Coca-Cola’s plan to launch a new bottle made from 100% recycled plastic.
But digital media has a carbon footprint, too. A big one.
The energy required to compute code for advertising generates roughly 2% of the internet’s total emissions, according to data from Good-Loop, a UK-based startup that creates technology to help advertisers stick to sustainability pledges and raise money for charity.
“Programmatic has a cost to the planet,” said Amy Williams, CEO and founder of Good-Loop.

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The Ad Tech Vendors Helping Programmatic Go Green - AdExchanger

Good-Loop offers a green ad tag that estimates how much carbon is created by digital ad campaigns, but its flagship product is a programmatic pre-roll video player that offers viewers a chance to prompt a charitable donation funded by the advertiser in exchange for watching or engaging with an ad.
The company, which recently closed a $6 million Series A round, says it’s raised more than $5 million for charities so far, including WaterAid, Feeding America and Save the Children.
“As a whole, the internet has a larger carbon footprint than the entire airline industry,” said Williams, who started her career as an account manager at Ogilvy & Mather. “We have something to answer for.”
‘Auctions of auctions of auctions’
Take header bidding.
Moving away from the waterfall allows publishers to offer their inventory to multiple exchanges at once, which in most cases leads to better pricing, more control and an increased fill rate.
It's time for programmatic to go green.Every exchange has the opportunity to respond with a bid for every ad request that comes in.
“But when you multiply the computational load, you multiply the carbon cost,” Williams said. “Programmatic is a bit of a double-edge sword – it can make advertising more efficient from a financial point of view but inefficient from a planet point of view.”
Many sites also work with multiple supply-side platforms that make multiple calls to multiple demand-side platforms.
“We’re talking about thousands and thousands of requests going into the ecosystem,” said Brian O’Kelley, who personally helped invent the exchange-driven ad model in the early 2000s. “It’s auctions of auctions of auctions – and it’s incredibly duplicative and wasteful.”
Earlier this year, O’Kelley launched a startup called Scope3, which gauges how many grams of carbon dioxide or other greenhouse gasses are emitted for every thousand impressions served or ad dollar spent. The hope is that, if advertisers have access to this type of data, they can monitor the environmental impact of their spend and optimize accordingly.
Scope3 used its data to demonstrate that The Trade Desk’s decision to stop buying ads through Google Open Bidding saved the equivalent of 5,387 tons of carbon dioxide emissions.
As one of the godfathers of ad tech, O’Kelley says he does feel the need to take some sort of remedial action, considering he was instrumental in unleashing the beast.
“I’m very aware that the invention of RTB and programmatic was kind of a Pandora’s box that created a whole bunch of issues,” he said. “This is a $100 billion industry and it has to operate differently now than when I was buying servers on my credit card – we need to consider all of the externalities, the secondary and tertiary impacts of what we do.”
Scoping out the problem
The name “Scope3” is a reference to the technical term for downstream emissions that result from anything not directly related to a company’s own actions.
The programmatic supply chain, which is packed to the rafters with middlemen, is a perfect example.
Many companies don’t report on their Scope 3 emissions, because they’re difficult to measure and manage. And that’s a problem, because for most businesses Scope 3 emissions make up the majority of their carbon footprint, said Marty Krátký-Katz, CEO and co-founder of Blockthrough, an ad block revenue recovery company that’s also partnering with O’Kelley’s Scope3 to develop a low carbon ad product.
The tool, which is set to launch late next quarter, will allow ad buyers to target lower-carbon inventory, such as native-style text ads, through their existing DSP using a specialized universal deal ID. Launch partners include AccuWeather, CafeMedia and Freestar.
The fact that digital advertising has a significant carbon footprint is still a relatively new concept to many, including industry experts. But “awareness is growing rapidly,” Krátký-Katz said.
“It’s becoming more of a priority,” he said. “Many Fortune 500 brands have committed to carbon reduction goals.”
Ad tech vendors, publishers and marketers are starting to consider the environmental impact of digital advertising.Brands dive in
One such brand is HP, which partnered with Good-Loop last year on a campaign to promote its sustainability work.
HP has sourced three million tons of ocean-bound plastic – abandoned plastic waste that would otherwise likely end up in the ocean – to make its Dragonfly laptop, Elite c1030 Chromebook and other products.
Using Good-Loop, HP was able to raise more than $100,000 worth of donations to support its sustainability partners, the Ocean Conservancy and 1% for the Planet, a nonprofit organization that helps connect businesses with environmental groups.
Although this sort of ad product is still experimental, it opens the door to thinking more laterally about sustainability and environmental impact, said Ian Mundorff, HP’s global head of media.
For example, a tech vendor’s carbon footprint and whether or not the company engages in any form of proactive offsetting isn’t a deciding factor for HP today, but that sort of thing “will become increasingly important,” Mundorff said.
“I could see it being the piece that helps us decide between two companies that are otherwise at parity,” he said.
Easy wins
In the meantime, there’s low-hanging fruit that publishers, advertisers and their partners can pluck (unless they’re fruitarians that only eat fallen fruit … but anyway).
Publishers can limit their ad density, for example, so they have fewer but more performant and higher-yield ads running on the page, Krátký-Katz said. Reducing a site’s ad refresh cadence, not going overboard with video monetization and cutting out superfluous supply paths couldn’t hurt either.
“Maybe you don’t need to hit the same SSP via TAM, Prebid and OB,” Krátký-Katz said.
Ad buyers can also do their part by allocating a greater portion of their budget to lower-carbon creative, like standard IAB display units, and rewarding media owners that prioritize sustainability, he said.
The timing of ad campaigns can be a factor, too.
During off-peak hours, for instance, roughly 80% of electricity in the UK comes from sustainable wind farms. But at peak times (after work when a lot of people are cooking dinner, watching TV and multiple lights are on in the house), “electricity becomes increasingly more dirty,” said Good-Loop’s Williams.
That means there are times in the day when ads are very likely running on green energy and times of the day when they’re likely not.
“We’re never going to end header bidding or ask people to run all their ads at 3 a.m. when no one will see them – all of this has to be done with an air of pragmatism,” Williams said. “Our point is that it’s time to be mindful of the impact of advertising.”
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