Programmatic’s opacity problem isn’t going away — and Trade Desk’s new payment model raises more questions than it answers.
More than 15 years ago, Michael Learmonth published a report in Advertising Age that showed how few of the dollars spent in digital media actually went to publishers. Back in 2010, before programmatic really took hold of our industry, his research estimated that less than half of all dollars spent to advertise on premium sites actually went to those sites, thanks to the many intermediaries and third-party tech redirects that were implicit in any campaign.
More recent research by industry trade groups, such as the UK’s ISBA (Incorporated Society of British Advertisers), puts that number at just over 51%, despite the growth of programmatic and the arrival of real-time header bidding. Interestingly, the research indicates that a significant portion of media buys—up to 15%—disappears completely during campaign flights. Here in the US, the ANA (Association of National Advertisers) has claimed for years that ad fraud runs as high as $80 billion a year in digital video alone. This 15% disappearance has been met with a collective shrug by media buyers in digital for more than a decade now, as companies like The Trade Desk, Amazon, Meta, and Google reap billions in fees while requiring buyers to use only their internal verification tools—or else.
Why have marketers settled for this for so long? Why has it taken so long for the industry to force platforms to submit to an audit that’s not run by the platform itself? Is this about enabling transparency? Or is it more about who gets the lion’s share of that 15% that nobody can account for? Or is it both?
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The “Incrementality” Trap
Is the recent announcement by The Trade Desk that they’re changing how they’ll pay audience partners with a new “incremental” model just another brick in this wall of occlusion?
If data company A and data company B both sell custom, curated audiences via The Trade Desk, and both perform exactly as expected, The Trade Desk soon will be able to choose which one they pay more and which one they pay less to based entirely on its own algorithmic scale of “incrementality.” You might think this is about performance—that is, which dataset drove more conversions. But it has nothing to do with performance and everything to do with differentiation as decided by a secret algorithm.
Payments will be tied to the incremental value a partner’s identity data provides—meaning, if a data partner contributes unique signals not already captured elsewhere in the demand-side platform’s (DSP) system. The shift is intended to deprioritize duplicate data and reward differentiation.
To see how this plays out in the real world, imagine two different business-to-business (B2B) data providers who have both mapped out high-value “Cloud Security Decision Makers.” Under this new model, if The Trade Desk’s internal system determines that it already has a similar audience footprint, Data Provider B is financially penalized and deprioritized—regardless of whether Provider B’s specific data actually converts better for the advertiser.
The Trade Desk promises to introduce new tools, including APIs and scoring mechanisms, to help partners understand how their data is evaluated under the revised model. However, those tools are not yet available.
When will they become available? Who knows? What will these APIs be based on? Again—who outside of The Trade Desk knows? The platform is essentially telling programmatic buyers that what’s good for Google is good for them: “Nobody else can check our homework except us.”
Meanwhile, advertisers are complaining that this is simply about cutting costs and making more from each campaign—controlling the economics of the open web’s programmatic segment even a little more tightly with each opaque turn.
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The Marketer’s Survival Guide: Taking Back Control
Marketers do not have to wait for the ecosystem to fix itself. If you want to stop letting platforms grade their own financial homework, you need to change how you buy and validate your audiences today.
- Demand Log-Level Data (LLD): Stop settling for slick, high-level dashboard summaries. Demand raw, log-level data from your DSPs. If a platform refuses to show you exactly which impressions your data ran against and at what exact cost, they are obscuring the truth.
- Audit Your Data Partners Directly: Don’t let a platform be the sole judge of data quality. Test your data partners via direct Private Marketplace (PMP) deals or data clean rooms, where you can verify the uniqueness and conversion power of the data yourself.
- Diversify Outside the Major DSPs: If a platform treats your budget with arrogance, shift a percentage of your spend to emerging, independent programmatic environments that offer open APIs and welcome external validation.
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The Next 24 Months: The AI Disintermediation
If a performance media buyer compensates media sellers only for inventory that performs, the seller has the right to reserve inventory for other kinds of buys, such as impression-based campaigns. The Trade Desk says, “Not so fast. We get to decide which data is adding incremental value in cross-media campaigns based on KPIs that only we will see.”
One wonders how long the buyer community will tolerate such arrogance. Buyers will continue to pour money into this segment and wonder where their dollars are actually going—but not for much longer.
This friction is setting the stage for a structural collapse of the traditional ad-tech stack. The tech giants believe they have a permanent lock on the market because their ecosystem is too complex to bypass. They are wrong.
Very soon, enterprise brands will deploy proprietary, AI-based buying tools. Instead of logging into a clunky DSP dashboard, navigating hidden fee structures, and accepting opaque “incrementality scores,” a brand’s internal AI will talk directly to a data seller’s API. The AI will look at your first-party CRM, securely match audiences, negotiate real-time pricing, and deploy the ad directly to a publisher’s server.
By automating the negotiation and execution layers natively, AI completely cuts out the middleman’s 15% disappearing act, rendering the traditional DSP moot. Many industry insiders expect this shift to occur in as little as 2 years.
