Asia-Pacific’s market maturity challenge: no common ground for performance, viewability, fraud

The Internet Advertising Bureau (IAB) has laid bare the polarised nature of the advertising industry in Asia-Pacific, in which mature and emerging markets can take vastly different approaches to brand safety, viewability and fraud, which could be slowing growth in the region.

In its first extensive regional brand safety study, which collates more than 200 responses from brands, agencies, adtech platforms and publishers across APAC, the trade body has identified a clear gap in understanding and approaches towards advertising’s key issues, depending on market maturity.
It identified mature markets as Australia, Hong Kong, New Zealand and Singapore. Emerging markets are China, India, Indonesia, Malaysia, the Philippines, Taiwan, Thailand and Vietnam.

When it comes to viewability, the Asia-Pacific region doesn’t follow one common standard. Where emerging markets prefer to use off the shelf global solutions like the MRC standard (63% cited this) and those used by their third-party verification partners (29%), mature markets have more sophisticated needs, with one-quarter developing their own standards.

The MRC standard for viewability is by no means the default standard in the region for viewability, and this is especially the case as markets become more mature.

This is in contrast to the approach in emerging markets to brand safety, where respondents indicated a much higher propensity to set standards at a regional and local level.

Elsewhere, emerging markets in Asia-Pacific lean more heavily on engagement metrics like time in view, reach, and video completion rate, while mature markets have an even mix of performance and engagement. Performance metrics are based around paying for a certain action; cost-per-click (CPC), cost-per-sale (CPS), and cost-per-lead (CPL).

“This leads to a situation of inconsistency in measuring and defining ad effectiveness, which can hamper comparisons and our understanding of the state of the industry in our region,” the IAB Southeast and India said in its report. “These inefficiencies could lead to problems in the longer-term if global investment into the region slows as a result of not being able to see return on investment.”

There is also inconsistency in the region in how ad fraud is approached, with most of the onus being on adtech platforms and agencies to detect and prevent fraud. Within these companies, understanding of ad fraud is driven by those who are in technical roles, with only half the industry across issues of ad fraud in their day-to-day role.

The most common types of ad fraud encountered in the region are bots, spiders and other crawlers as well as fraudulent proxy traffic, and that is consistent across the industry.

Publishers reported far less adware and malware and concealed or stacked ad placements—but as they own the ad placements it would be odd for this to occur on their own site.

The most commonly reported tool used to prevent fraud was whitelisting, selected by 76% of respondents. The less common types of anti-fraud measures were traffic sampling and click-to-install analysis. As a region where growth is driven by high mobile adoption, the relatively low use of app-related anti-fraud measures is “a significant area of concern,” the IAB said.

Additionally, the trend of favouring cost-per-click as a measure of ad effectiveness also poses a risk in driving more bot-related fraud, the organisation noted.

Few brands made use of a verification partner for either fraud or brand safety solutions, using whitelisting at a higher proportion.

When it comes to brand-safety tools, the highest category reported across publishers, agencies and adtech platforms were blacklists, followed by whitelists. Publishers appear to use keyword blocking less than other company types, which is surprising as this is a method to specifically avoid advertising placements appearing in the wrong context.

Respondents who worked with luxury goods clients showed a higher overall usage of all four brand safety tools—whitelist, blacklist, keyword blocking and verification partners—due to luxury goods brands generally being more concerned about brand safety.

Financial services, on the other hand, appear to be more concerned about appearing on the right type of website, prioritising blacklists over other tools. The fact that keyword blocking is used the least by those working with FMCG brands shows that the context of ad placements is a lower concern.

The IAB SEA and India has a goal of making brand safety an everyday consideration for all businesses across the Asia-Pacific region over the next three years.