The advertising industry is demanding substantial refunds from YouTube due to recent research indicating that millions of ads on the platform are hidden in ways that violate Google’s policies.
Adalytics, a digital ads analysis group, conducted a study on YouTube’s “TrueView” system, which allows users to skip ads after five seconds. The research found that these ads were playing silently and on an automatic loop in the background of “hundreds of thousands of websites and apps.” This strategy bypasses viewers’ attention, preventing the ads from being skipped, but it violates Google’s terms.
Google promotes its “choice-based ad format” by assuring advertisers that they will only be charged if a user watches the entire ad or at least 30 seconds of it. If the ad is skipped, no payment is required. TrueView ads are a crucial product for YouTube’s $30 billion business, with global clients typically allocating a significant portion of their budgets to these skippable ads.
However, Adalytics’ research indicates that many TrueView ads were placed “out-stream,” hidden in sections of websites with minimal viewer interaction. This finding prompted industry figures to call for investigations and refunds from YouTube. Adalytics compiled a list of affected advertisers, including prominent brands like JPMorgan Chase and Johnson & Johnson, as well as the US Department of Health & Human Services.
The global chief media officer at UM, Joshua Lowcock, stated that the issue reflects a failure by Google and YouTube to properly enforce their policies. He recommended an independent audit of policy enforcement and refunds for impacted advertisers. Giovanni Sollazzo, chair of Aidem, advises affected advertisers to promptly request refunds.
Ruben Schreurs, chief product officer at Ebiquity, believes that this research will significantly damage Google’s reputation in the $400 billion digital advertising industry. In response to the findings, Google defended the quality of its partner network but acknowledged the need for appropriate actions, including the possibility of removing ads from certain websites.
The inefficiencies in the digital advertising industry extend beyond YouTube. The Association of National Advertisers reported that 15% of the $88 billion spent on automated digital ads is wasted on websites designed to flood users with ads and generate accidental clicks.
Google assures advertisers that TrueView ads will only appear on “high-quality publisher websites” that meet its inventory quality standards. However, Adalytics discovered numerous instances where these standards were not upheld. Ad examples included scrolling-initiated muted video feeds of multiple ads followed by random content, all counted as engaged views.
Advertisers often lack precise knowledge of where their ads are placed due to Google’s limitations on third-party tracking tools. Adalytics researcher Krzysztof Franaszek emphasizes that Google’s servers determine when and where TrueView ads are inserted.
Google previously allowed “video action campaigns” to exclusively spend on YouTube but removed the opt-out option for the video partners network in September 2021. Marketers can now work with their Google representative to opt out.
Adalytics found that a significant portion of TrueView ads were allocated to partner websites that did not meet Google’s standards, including sites accused of spreading disinformation. Claire Atkin, cofounder of Check My Ads, states that this research presents an opportunity for advertisers to seek refunds and legal action.
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