Tackling advertising's carbon footprint

Tackling advertising's carbon footprint

We take a look at the carbon footprint of digital advertising, and what this means for the sustainability strategy of marketing agencies.

Whilst physical advertising assets (e.g. a newspaper ad) create emissions in a way that’s straight forward to visualise, the footprint of digital advertising is a little more abstract. Emissions are generated at every stage of the often complex lifecycle of a digital ad. Let’s take a closer look.

How does digital advertising produce emissions?

The lifecycle of a digital ad can be split into 4 broad stages, each with a corresponding emissions output:

1.      Production

Creating digital content generates emissions in a variety of ways, including: on site electricity consumption (e.g. at a shoot or in post-production); offsite electricity consumption (e.g. cloud-based storage of content); the cradle to gate emissions of any equipment used (e.g. AV kit); emissions from travel, accommodation and catering for the shoot team.

2.      Ad placement

Next, the media buyer (e.g. a marketing agency) must engage a publisher to place that content in a space where it will reach the desired audience in exchange for a fee. This negotiation between buyer and publisher can take place directly between people, or through technology via an automated or ‘programmatic’ auction.

Programmatic value chain

Programmatic placement involves a complex and carbon intensive exchange of data between technology platforms used by the media buyer (Demand Side Platform / DSP) and publisher (Supply Side Platform / SSP) via an ad exchange (think trading floor).

A typical auction happens in real-time within fractions of a second, triggered by the end-user visiting the publisher’s site. The SSP shares data on the end-user (geographic location, demographic etc.). DSPs receive this information and decide whether to bid, and at what price, based on the audience the media buyer is targeting with its ad. Finally, the SSP reviews various bids and assigns the impression to a winner given its price floor is exceeded. Beyond this essential bidding mechanism, DSPs, SSPs, and third-party technologies perform a range of functions including detecting false ad inventory, and budget tracking.

What’s the key takeaway from this complex process? Each successful (and unsuccessful) ad placement entails the processing of data and running of algorithms by multiple parties and technologies. Every time data is processed, a server is fired up, and that server consumes electricity which in turn is generated by a fuel mix that likely contains GHG emitting fossil fuels. Add to this the embodied footprint required to manufacture and dispose of servers and network infrastructure, and programmatic generates a serious footprint.

3.      Ad delivery

Once the winning ad has been selected, it’s shown to the end user. The content is transmitted from the server where it is being stored across a network before being processed by the user’s device. Alongside the energy consumption and resulting emissions required to transmit the data, embodied emissions arise from the manufacture and disposable of the infrastructure (network components, end user device etc.).

4.      Performance tracking

A key element of the digital advertising ecosystem is performance tracking. Data is recorded and stored on ad efficacy (impressions, click-through-rate etc.). This data is then leveraged by buyers to forecast ad impact and match content with space. Once again, energy is required to power collection, storage, and analysis of data (read powering up servers), whilst manufacture and disposal of the underlying hardware (devices, servers etc.) has a footprint too.

What does this mean for my footprint as a media buyer/ad agency?

Under the GHG Protocol, the most widely used standard for carbon accounting globally, emissions are categorised into 3 categories or ‘Scopes’. Ads purchased on behalf of a third-party (i.e. by a marketing agency for a client) fall into the purchaser’s Scope 3, specifically as ‘Purchased Goods and Services’.

Incorporating goods/services bought on behalf of a third-party in your own footprint can seem counterintuitive. However, this is a fundamental feature of Scope 3 and its design-brief to capture all emissions over which you have influence, namely those in your value chain. By definition, your Scope 3 emissions incorporate the emissions generated by your supply chain partners and customers. There is therefore double counting of indirect emissions between businesses.

Advertising is no different. Emissions from advertising purchased on behalf of clients will fall into the Scope 3 footprint of both you and your customer, because you are both able to make decisions which influence the carbon footprint associated with that ad spend.

For the average agency, media buying is likely to comprise a significant and perhaps majority portion of your footprint. As an example, WPP - the world’s biggest media buyer - reports that media buying constitutes 54% of its total carbon footprint, with emissions from production at 14%.

WPP Sustainability Report, 2022

What can I do to reduce ad emissions?

Understanding your footprint is a key first step to spotting opportunities to reduce emissions. It can be an illuminating exercise, identifying both quick changes alongside embedded challenges to tackle longer term. A full carbon assessment will set out emissions your business generates across its operations, including through ad production and media buying.

Formally setting an emissions reduction goal (such as a Net Zero target aligned with the SBTi) helps embed sustainability as a factor in decision making. In addition, making a commitment, and sharing your work on emissions reduction can open up the conversation around the impact of advertising and encourage others in the industry to act. It may also help to begin conversations with clients so that you can better understand their priorities and and help them to build sustainability into their ad strategy.

Let's take a look at some specific strategies to reduce emissions across the ad lifecycle:

1.     Production

The most tangible stage to visualise, reducing the carbon footprint of production is not dissimilar to reducing the wider operational footprint of a business. Some examples: less and more sustainable travel (opt for a domestic shoot, choose hotels close to site, train vs. plane); vegetarian/vegan catering; circular economy thinking (garment hire vs. new purchases where possible), use studios that opt for renewable energy. The common theme here is advanced planning with sustainability front of mind.

2.      Media buying

When it comes to ad buying, consider:

- Optimising file size by compressing media. Larger files require more energy to transmit.

- Prioritising direct ad placement where possible/appropriate.

- Channels with higher conversion (few impressions generating the same result) lead to less 'wasted' energy vs. a tactic of high impression volume with low conversion rate. Efficient marketing strategies are often the most sustainable.

- Distributing via WIFI not 3/4/5g.

The above must obviously be balanced with commercial/strategic considerations.

How Seedling can help

Measuring the carbon footprint of digital advertising is a complex task. Calculation methodologies are new and fast evolving as more research is published. As such, detailed measurement of a media buying footprint is often reserved for the large buyers with dedicated teams and budget to tackle the issue. The reality for many SMEs is that even free open source methodologies require significant investment in time and expertise to digest and apply.

At Seedling, we offer a range of footprinting methods (from a spend-based assessment to granular volume-based analysis), to help agencies measure their impact as accurately as possible, improve that accuracy over time, and ultimately drive sustainable decision making. We help you to understand your ad-related footprint alongside your broader operational footprint too. Most importantly, we offer one-to-one guidance, tackling the complexity on your behalf. We believe footprinting offers an opportunity for agencies to not only reduce their own footprint, but to provide added value to their clients through ad strategy that is considered and sustainable.

If you're keen to learn more, get in touch at hello@seedling.earth

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