Not long after the 2008 global financial crisis ended, I bumped into a banker who had previously hired “rocket scientists” — the label given to graduates with good engineering and maths skills — to work in the derivatives market. Since banking had, temporarily, been dented, I asked where these whizz kids were now heading if they wanted to make money. “Adtech!” he replied with a chuckle.
As someone who had previously written mostly about finance, I was surprised. I still saw advertising as a copy-and-images business, washed down with long martini lunches in the manner of Mad Men. But, around this time, advertising agencies were already using data analytics to send targeted digital ads, and connecting advertisers with media platforms to place them. Advertising was on its way to becoming a game dominated by big data. Engineers and mathematicians were therefore in demand.
I never determined how many had really gone from slicing and dicing mortgage debt to repackaging ads, but the fact that this tale was circulating was revealing: in adland, as in finance, those who understood computers and data were potentially wielding extraordinary power in a way that almost nobody else fully understood.
Why does this matter today? The issue lies with misinformation and extremism, especially with another US election looming in 2024. In recent years many big advertisers have said they do not want to put ads on the plethora of sites that have appeared to give a platform to racism, xenophobia, extremist politics or disinformation.
Join Gillian
Join Gillian Tett in Washington, DC, on May 20 at our second annual FTWeekend Festival US edition. Register now at ft.com/festival-us.
However, it can be surprisingly hard for companies to actually avoid their ads appearing on such sites. Before the rise of digital advertising, companies typically paid media companies for ads via agencies, so they knew where these would appear. Today, only the biggest media companies, like the FT, have direct sales systems; most other platforms get revenue from brokers who use “programmatic” advertising, or computer programs that place ads according to how advertisers want to target groups.
That means advertisers may not know where their ads are appearing. They can appear in unwanted places and, in essence, be used to fund disinformation. A watchdog called the Check My Ads Institute has been trying to track this since 2021, by scouring the internet, and has discovered ads from Warby Parker, the glasses company, and the multinational Procter & Gamble on WeatherNation, a digital channel owned by the rightwing American firebrand Steve Bannon. (The companies say this was a mistake and removed them.) Due to scrutiny by Check My Ads, a slew of other groups, such as Nissan, Audi, LG TV or Royal Bank of Canada, have also removed ads from extremist sites or those associated with Russian disinformation. Claire Atkin, co-founder of Check My Ads, says this is just the tip of the iceberg. “Ad-financed disinformation just keeps rising,” she laments.
And these money flows are hard to track since the internet is so fragmented that when ads are sent to sites that target certain social or political online tribes, few others ever see them. Worse still, the adtech world is plagued by shadowy middlemen which, as it happens, is rather similar to finance.
In 2020 the consultant PwC released a two-year study that suggested the market is worth about £100bn worldwide (although Atkin notes that other estimates suggest a figure four times higher). PwC concluded that almost half of corporate online ad spending is absorbed by brokers. It was also unclear where one-third of the money spent actually went. “The market is damn near impenetrable,” Phil Smith, the director-general of Isba, the UK advertising trade body that commissioned the study, told the FT at the time.
Is there any solution? There seems little prospect of returning to the days when advertisers struck direct deals with every media platform; the web has just grown too big. And regulators have hitherto been relatively toothless. So I suspect that the best remedy in adtech, as in finance, is the sunlight of exposure. The more scrutiny — which means the more eyeballs (or artificial intelligence tools) — that can peer into the murky corners of the internet, the better the chance of raising standards and fighting disinformation. “Advertisers are handing suitcases of money to strangers [ie brokers],” says Atkin. “We need data scientists to help figure out who owns the adtech middle men.” Let us hope some of those “rocket scientists” will help.
Follow Gillian on Twitter @gilliantett and email her at gillian.tett@ft.com
Follow @FTMag on Twitter to find out about our latest stories first
