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The digital advertising industry is beginning to wake up and respond to the unexpectedly high carbon footprint of the delivery of billions of digital ad impressions per day. While a few brands, agencies and adtech companies are beginning to commit to reaching net zero carbon emissions by as early as 2030, the question remains: What it will take for the majority of the industry to get on board with such lofty goals?
The solution likely lies in how the industry will prioritize carbon emission reporting; how advertisers will use their monetary influence to hold their partners accountable for reducing carbon emissions; and by educating consumers on carbon emissions.
Quantifying carbon emissions from digital advertising
Digital advertising is typically considered the more environmentally friendly alternative to the more tangible negative environmental impact of print advertising. The reality, however, is that the internet generates approximately 2 to 4% of all carbon emissions, which is about the same as the civil aviation industry. While much of that comes from the delivery of digital ads, the good news is that digital advertising has the power to be the first industry to become carbon neutral.
To put that into perspective, the energy required by all the data servers, ad servers and user devices to serve just one million ad impressions is the equivalent to about one metric ton of carbon dioxide emitted. That is equivalent to the emissions produced by:
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- One passenger on one round trip flight between Boston and London
- Charging over 121,000 smartphones to full battery power
- The carbon in 2.4 million plastic straws
Tracking carbon emissions from digital ads
The good news is, the digital ad industry’s focus on reducing carbon emissions has been gradually gaining momentum since 2016, when 200 countries signed the Paris Agreement towards a global goal of net zero carbon emissions. In 2020, the UK Advertising Association launched Ad Net Zero, acknowledging the global advertising industry’s need to become more environmentally sustainable. Since then, numerous agencies and brands, such as WPP, Havas, Dentsu, Disney, Unilever and Dell, have pledged to reach net zero emissions by 2030 or later.
But how will adtech reach such aggressive carbon-reducing goals? A vital step is setting standards for how the industry measures and reports the carbon emissions it generates. By measuring carbon emissions, an organization can get a baseline of their current CO2 waste and determine their largest sources of emissions. Much as many companies publicly report their financial performance, reporting on carbon emissions is a good way for advertisers and brands to remain transparent and accountable towards their goal of net zero carbon emissions.
Setting industry standards
Measuring carbon emissions, however, is not exactly straightforward. One way to simplify the process is to understand the many components that impact a company’s carbon footprint. They are broken down into three categories: Scope 1, Scope 2 and Scope 3.
Scope 1 and Scope 2 emissions are generated by the advertiser’s facilities and energy consumption from the power grid. Scope 3 emissions are generated by the advertiser’s media buying supply chain and typically make up more than 90% of a company’s total carbon emissions. For advertisers to gain an accurate picture of the carbon emissions generated, it is crucial for them to know how much their DSP, SSPs, DMPs, publisher partners and other vendors contribute to their Scope3 emissions.
For this to work, the ad industry needs to agree on standards for carbon emissions reporting. Such an initiative would need to come from an organization like the IAB or in conjunction with sustainable organizations like Ad Net Zero. It will also require a technological solution from third parties to measure the carbon output created by serving digital ads. Scope3, led by former AppNexus founder Brian O’Kelley, is one of the first companies building such a solution, but the door is open for others to do the same.
Advertisers have the power to catalyze change
Environmental sustainability in adtech requires a collective effort from every participant in the industry. However, advertisers have the most power to drive significant change throughout the programmatic supply chain. Specifically, brands and agencies can use their ad dollars to prioritize their ad spend with partners and vendors that are measuring and reporting on their carbon emissions. They can also pressure partners to develop turnkey solutions that reduce any friction so advertisers can start buying “green” media right away.
The optimal first place for advertisers to direct their influence is with ad exchanges since they control the path from advertiser to publisher. Once exchanges can offer solutions to offset the carbon emitted from the ad supply chain, the rest of the supply chain can follow suit. Luckily, a handful of SSPs have started offering such solutions.
But when the majority of exchanges have a carbon-offsetting offering, advertisers will be able to push their DSPs to provide a simple way for them to buy only through partners and/or publishers that can offset the carbon from their ads. As more and more brands, agencies and adtech partners are reducing their carbon emissions, the better chance the industry has of reaching ad-net zero by 2030.
Reaching and teaching consumers
The other major priority in this process is educating consumers about both the environmental impact of browsing the internet and what advertisers are doing to offset carbon emissions. A recent study revealed that six out of 10 consumers were unaware that digital ads and browsing the internet generate carbon emissions. Advertisers have an additional incentive to educate consumers on their efforts since 80% of consumers favor brands that are reducing their carbon emissions.
Brands that have a vetted sustainability plan can use their creative messaging to educate consumers on the ways they are working to reduce their carbon footprints while being careful not to sound like they’re greenwashing. But educating consumers on the carbon emissions impact of browsing the internet is more difficult. It will require the adtech industry to work together to write and produce consumer-friendly content, and possibly create labels to identify ads that are served with net zero emissions. Once the industry aligns on the tracking and reporting of those emissions, such steps will be easy to implement and will go a long way toward educating consumers.
Net zero carbon emissions is possible by 2030
Now that the ad industry is aware of the impact it has on the environment, it is time to take action. The good news is that solutions are in development, and advertisers are at least starting to use their buying power to make a difference. A rising tide may float all boats, but adtech needs to act fast before the real rising tides wash the boats to shore.
Frank Maguire is VP of insights and strategy at Sharethrough.
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