Net 30 Payments and Other Lies, Part 1

Let's talk about truth, justice, and the ad operations way.

I'm a fan of hot, sweet justice in all of its forms. I watched Revenge even when it got bad, Kill Bill's The Bride is my go-to spirit animal, and if someone cuts me off on the highway only to be pulled over by a cop a mile up the road (THIS HAS ACTUALLY HAPPENED) the satisfaction alone can put me on cloud nine for a whole week. Justice is great. But it's not guaranteed. Most wronged parties don't receive it, and most offenders keep on keeping on.

Fun, sad fact: not everybody is a good human being. There are loads of people out there who want to take advantage of you and have no qualms about doing it. The ad tech space is most certainly not immune to such individuals. Most of us know that you don't accept candy from strangers, you don't get into gypsy cabs, and you don't give your bank account information and social security number to the Nigerian prince who has a great business proposition for you. Most of us can see a sketchy situation for what it is and walk away. But it is easy to forget how to listen to your gut when you have someone in front of you who says they are willing to pay you a ridiculous amount of money to post their ads on your site. You've been waiting for this moment for a long time, and when it happens you err on the side of hope and think you've finally hit your stride.

I'm going to say something now that may shock you. Brace yourselves. 

Every agency lies. Every ad network lies.

This is important to know and understand before you really start dealing with these companies. Most of these lies are generally harmless. Most of the liars have the best of intentions and don't even realize they're doing it. It's just part of the business. Here are some examples of lies I've heard from agencies and ad networks over the years:

• "You're my favorite publisher! I really want to see you succeed."
• "We can definitely monetize better than your other partners."
• "Yeah, we can get you creatives at least five business days before launch."
• "With our top-tier brands, we can guarantee that our creatives will be of the highest quality."

And my personal favorite:

• "We pay net 30."

A lot of quality ad networks will be able to abide by the net terms on the contract, but some won't, and you will hear every excuse under the sun as to why they aren't paying on time. Agencies DEFINITELY won't. Ninety percent of payments made to my publishers are late by some measure. Usually this is not intentional. Agencies are notorious for having poor internal communication. You talk to the account manager, but payment comes from the AP department, and there are several steps in between the two. If you're a larger publisher, it's likely you have a similar set up. On one side or the other, there's usually some miscommunicated approval or requirement that results in a late or incorrect payment. It's just part of ad tech life. It does not make you a bad publisher or make them a bad agency. It just happens. It sucks and you should try everything within your power to close the gaps on your side so you are not the cause of the delay, but know that when it happens YOU ARE NOT ALONE.

Sometimes a delayed payment to you is a result of a chain of delayed payment. A popular addition to most contracts is the "we don't pay you if we don't get paid" clause, used by agencies and ad networks alike. Not groundbreaking or unusual, this idea totally makes sense, but sucks in practice. And you probably can't do anything about it. 

Know that as the publisher, you are the perpetual holder of the short stick. Everything in the industry is geared towards making the advertiser happy, providing the advertiser with data, giving the advertiser the tools to succeed. The publisher is truly at the bottom of the totem pole, providing the industry with the very ability to exist but constantly overlooked in favor of the impressive sections above it. Unless you are lucky enough be a very large publisher, or have a highly desirable and unique audience, get used to being told you're a special snowflake when really you're going to end up working at a retail job and living with three roommates.

From this moment onwards, bathe in the waters of pragmatism and know that you aren't always going to get a fair shake and most everything an ad network or agency says needs to be taken with a salt-rimmed tequila shot. Or five.

Some truth: by supplying someone with ad space on your site, you are extending them credit. You are saying here, take this now, and pay me later. But unlike the credit card companies who do this so well, you don't have much power to seek justice if you aren't properly compensated for that space. You're out the value of that space, and time spent. And it's possible that that's the best case scenario. Worst case: you could also end up losing some users.

A DIRECT-SOLD STORY

At Grooveshark we had a direct sales team of about 6-8 people in the US at any given time. These people were not new to sales. Some of them had been selling for upwards of a decade. But the distinctly human ability to hope that something good FINALLY happened can cloud anybody's judgement, even a savvy salesperson. It was my duty to bring them down from the sales high and protect the company's best interests. It was not fun. Sometimes my sales team didn't like me because I was a huge downer. But it's important to question the things that seem too good to be true...because they usually are. Sometimes I was wrong, and that's okay - it's better to be wrong in those situations than to be SOL later.

There were many times we ultimately didn't get paid for ad space, but there were exactly two times that I could have prevented it and didn't. Both times are a result of misplaced trust and poor due diligence.

Grooveshark's most exciting ad unit was a custom unit called a homepage takeover. Our designers would work closely with the agency to build out custom creatives for the homepage of our site, effectively turning Grooveshark into a platform for the brand with features like custom-built playlists, music festival sweepstakes, and interactive elements. Agencies went crazy over it, and it was the glue of most campaigns, with standard IAB banners thrown in the same way you always get cheddar bay biscuits at Red Lobster.

A few years into my ad operations career someone who claimed to be from Toshiba contacted one of our salespeople, who excitedly came to me with a signed IO for $60,000 worth of standard IAB banner ads over a month. They wanted to start right away. They had given us the creative tag, they had been emailing consistently with the rep, and they were so so so excited to work with us. At that budget size, they could have done a homepage takeover with us, but no, they wanted banners only. Something felt off, but I chose to ignore it. I woke up the morning after it went live to a dozen malware warning emails from DFP, all from the Toshiba campaign that had just gone live. We never heard from them again. I had been taken. And just like Liam Neeson, I was super pissed.

Looking back, I was extremely lucky that it was caught by DFP so quickly. We didn't lose users, and we didn't lose too much revenue from the impressions we gave them. But it was totally preventable by me. I only let it happen again once in my time at Grooveshark (silly mistake), and I'm going to share with you my guide for making sure it doesn't happen to you.

TRUST YOUR GUT

Your gut is extremely useful, and you should listen to it. If something tells you that the deal is weird or "off," cross check it with some of the common red flags associated with bogus campaigns.

• You know your best-selling ad units. If someone wants to buy a buttload of your worst-performing or less-in-demand impressions, its a good sign they are not serious.
• They have a very large budget for a very short flight. This means they want to push out impressions in huge amounts very quickly.
• The campaign goes live on a Friday or Saturday. Days when you're less likely to notice something fishy with their tags, and you might not notice until Monday that something went wrong.
• You're talking directly with someone who claims to work for the brand. Mom and pop shops won't necessarily fall into this category, but most brands use agencies as a middleman to advertise, so if you've been talking directly to Toshiba, chances are the person is full of crap.
• The person you're speaking with doesn't want to chat on the phone. They know they'll be caught if they talk to you, so they "prefer to keep things over email because it's easier" for them.
• The creatives are third-party tags, and when they render the design is overly simplistic or low-quality. Big brands usually have pretty great-looking creatives.

Just because a deal on the table hits one of these points doesn't mean you're dealing with a liar, but if it hits a few, take some measures to protect yourself.

• Take a look on LinkedIn. Can you find this person or anyone else from the company you with whom you can confirm it's a real deal? Toshiba should care that someone is claiming to represent them.
• Do a Google search. If you've never heard of the brand, does a search reveal that they are a real company? Are they on BBB? Does anything come up if you search for brand+scam? Is their website full of stock images and no real contact information like an address or phone number?
• Do a credit check. Asking the rep for their information to perform a credit check might be enough to scare them off.
• Ask for prepayment. It doesn't have to be much, but an argument can be made for a small investment on their part due to them being a brand new advertiser for you. It's a long shot, but if you get the prepayment, that goes a long way to confirming that this is a real deal.

If you're still feeling uneasy, walk away. It's okay not to take a risk with your inventory and your brand. If this was legitimate interest in your audience, there will be other opportunities, I promise.

Thus commences part one. Keep an eye out for part two in which I discuss ad network lies, both large and small, and how to protect yourself.

Until next time.

Jen