The widespread adoption of ads.txt is certainly helping clean up the programmatic supply chain, however, unsophisticated implementation could cause unnecessary damage to advertiser’s campaigns.

With publishers quick to adopt ads.txt – an IAB standard that is helping to solve ad fraud and transparency issues during the transactions process between publishers and seller – it’s becoming an effective tool for buyers. The industry initiative involves a text file, which publishers can host on their websites that show when advertisers are buying directly from publishers (Direct), when they are buying from an authorised reseller (Reseller), when the publisher has not implemented the ads.txt file (Unknown), and when inventory is being sold without publisher approval (Unauthorised).

Infectious Media, the programmatic and technology specialist, carried out research into the impact on advertiser performance of buying ads.txt authorised inventory. Some of the results back up industry assumptions about performance improving by cutting out the middlemen.

For example, the findings revealed that buying Direct inventory drove a 60% higher proportion of transactional sales when compared with Reseller inventory, as well as a 28% higher rate of non-transactional conversions.

These results prove that the inventory publishers monetise themselves directly also brings in more revenue for advertisers, which is a good indicator of user and inventory quality.

However, buying Direct is more expensive (37%) and prone to fraud (24%). These results contradict the assumption that buying Direct and cutting out Resellers will reduce fraud. As a result, advertisers need to assess premium inventory sources to ensure that it is clean, and ask their agencies and tech providers for a deeper understanding of the inventory.

Unknown inventory still valued

Interestingly, the research found that Unknown inventory (sites that have not implemented an ads.txt file) still drove a significant number of sales, providing value for advertisers. For advertisers, to disregard Unknown completely could constrict their ability to find the right person, at the right time, in the right place. For example, blog sites are a source of well-performing inventory due to their ability to reach niche audiences at scale, even though there is a small chance of these sort of sites adding an ads.txt file.

“Brands need to be careful in making assumptions around the definitions ads.txt has introduced. Many industry players are talking about these terms in a blanket way,” commented Dan Larden, director of strategic partnerships at Infectious Media.  

“Blunt implementation of ads.txt on the buy side could damage advertiser campaigns unnecessarily. Advertisers need to be asking their agencies and tech providers for a deeper understanding of the inventory they are buying to ensure the right strategies are in place for each inventory type,” he continued.

Infectious Media carried out the research in order to determine the best way to use ads.txt data to improve client campaign performance. It used proprietary technology to classify auctions based on the ads.txt category and combined this data with campaign data over a three-week period to test the performance of the seller types.

What are your thoughts on the implications of ads.txt for advertisers? Comment below or tweet us at @PerformanceIN