Deutsche Telekom: Brands could switch spend back to traditional channels if digital doesn’t clean up its act

The telecoms brand’s media boss has warned brands are done with talking about the issues in the digital landscape and will move money away if the industry does not start to take action.

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Advertisers could switch budgets back to TV unless urgent action is taken to address serious issues in the digital media ecosystem, according to Deutsche Telekom’s head of international media management Gerhard Louw.

Speaking to Marketing Week following the unveiling of the World Federation of Advertisers’ (WFA) Global Media Charter, Louw says tolerance among advertisers for the buck passing among those in the ecosystem is disappearing to the point where budgets could be reallocated unless the situation changes soon. Minimum viewability thresholds are of particular concern, he adds.

“[Tolerance] is not just decreasing in media, where people are getting more and more frustrated, but it’s reaching the top [board level]. This digital bubble is about to burst or has burst. [We are saying], ‘If you guys don’t sort it out, guess what? We’re going back to TV, all out’. It’s, ‘Let’s stop beating around the bush’,” he explains.

“The threat is there. I’m not going to a conference again where people are discussing what the problem is. We know what the problem is and the charter describes the problem. So, let’s talk about solutions and who’s doing what. Taking ownership and taking responsibility.”

The digital bubble is about to burst.

Gerhard Louw, Deutsche Telekom

His comments come as the WFA looks to tackle the issues in the digital landscape with its media charter. The organisation, which is funded by and represents the interest of the world’s biggest spenders on media, has detailed eight issues that require immediate action including ad fraud, walled gardens, supply chain transparency and minimum viewability standards.

For each of the eight it spells out what it expects of ad tech vendors, publishers, agencies and platforms, as well as what its advertiser members are committed to.

The WFA stresses the document is a “starting point”, an attempt to collect together the demands of advertisers for change. And although the document has the backing of hundreds of advertisers and national advertising associations and calls for “urgent” change, there are no direct consequences detailed for inaction.

However, Louw, who is co-chair of the WFA’s media forum, is clear on the potential consequences.

Tackling the ‘walled gardens’

The WFA’s charter also calls for “walled garden issues” to be addressed. Without naming Google and Facebook directly, it calls for a greater degree of transparency, with audience data linked to inventory purchased on the platforms made available to advertisers for analysis in licenced third-party data management platforms (DMP).

Audience data should be independently verifiable by third party audits, it adds.

Elsewhere, publishers and platforms are asked to share impression-level data with spend tracking companies so advertisers can track their level of media spending within their competitive set and within their category, something not currently possible because of platforms’ non participation in competitive spend tracking exercises, the WFA claims.

Louw explains: “We’re not saying share all your data Facebook, share all your data Google, that’s not going to happen. But the data we are involved in and where we invest in media placements, that data should be shared with [advertisers] on some level. We’re trying to say, ‘Listen. We are the investors here. We are paying you for the media space and the data also belongs to us. We should at least, at a minimum, have access to that data’.”

Deutsche Telekom recently unveiled a hybrid media model that saw it take media strategy and steering in-house, while the rest of its media model was divvied up into four ‘lots’: media analytics, campaign planning and buying, programmatic buying, and search advertising and affiliate marketing.

READ MORE: Taking back control: Deutsche Telekom on its journey to create a hybrid media model

The aim, as Louw told Marketing Week in a recent interview, was to take back control of media and improve transparency.

“One of the transparency issues is the question, ‘is the media strategy and plan that comes from my agency the best plan for me or is it driven by buying incentives?’. It’s very difficult to answer that if you don’t have the analytics to tell you what has worked and what could work,” he explains.

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