Can Industry Self-Regulation Actually Fix Programmatic's $5 Billion Waste Problem?

After some high-profile disagreements and LinkedIn flame wars last year over transaction IDs, the IAB Tech Lab is doing some peacekeeping. A newly formed standards org, the Programmatic Governance Council, wants to bring people together from different companies and with different points of view.

What Happened

OMD Worldwide Chief Media Officer Ben Hovaness is leading the new Programmatic Governance Council, formed by the IAB Tech Lab to address programmatic advertising's coordination failures. The council emerged after public disputes over transaction ID standards and aims to tackle bid duplication, which Hovaness estimates costs the industry $5 billion annually. The group is exploring multi-bidding solutions where DSPs submit multiple bids per request rather than SSPs sending multiple requests.

Why This Matters for B2B Marketing Leaders

Your programmatic spend includes a hidden $5 billion industry tax from bid duplication inefficiencies. When multiple demand sources bid on the same inventory without coordination, you're paying for waste that inflates costs across your campaigns. The council's focus on measurement also directly impacts your ability to prove ROI to executives. Better measurement standards could help you defend programmatic budgets against pressure to shift spend to walled gardens like Google and Meta, which offer clearer attribution.

The Starr Conspiracy's Take

Industry self-regulation faces the classic collective action problem: individual players benefit more from gaming the system than fixing it. While $5 billion in waste sounds compelling, the real test is whether DSPs and SSPs will sacrifice short-term revenue advantages for long-term ecosystem health. The council's success hinges on creating standards that can actually be enforced, not just voluntary guidelines. For B2B marketers, this represents a key moment to evaluate your programmatic measurement strategy and ensure you're not subsidizing industry inefficiencies. The focus on measurement could finally provide the attribution clarity B2B campaigns desperately need.

What to Watch Next

Monitor whether major DSPs and SSPs actually implement multi-bidding standards or continue prioritizing individual auction advantages. The council's ability to enforce compliance rather than just recommend best practices will determine if this initiative creates real change or becomes another industry talking shop.

Related Questions

How does bid duplication specifically impact B2B campaign costs?

Bid duplication occurs when multiple demand sources unknowingly compete for the same inventory, artificially inflating auction prices. This waste is particularly costly for B2B campaigns targeting narrow professional audiences where inventory is already limited. Understanding programmatic auction dynamics helps you identify when you're paying inflated rates.

What measurement improvements could help B2B marketers justify programmatic spend?

Standardized measurement would allow B2B marketers to prove that programmatic campaigns drive additional conversions beyond organic traffic. Current attribution gaps make it difficult to demonstrate ROI to CFOs questioning digital advertising effectiveness, especially for longer B2B sales cycles.

Should B2B companies reduce programmatic spending until these issues are resolved?

Rather than abandoning programmatic, focus on working with partners who prioritize transparency and efficiency. The addressability advantages of programmatic remain important for B2B targeting, but you should audit your current setup to minimize exposure to bid duplication waste while the industry implements solutions.