Key Takeaways:
- Insertion orders remain one of the most frequently negotiated—and most frequently disputed—contracts in digital media transactions.
- On the buy-side, focus on defining what you’re paying for, such as impressions or clicks.
- On the sell side, make sure the dependencies are clear as well as what happens if there are delays from the customer.
Today, most IOs are governed by industry standard terms, though some large media platforms may not abide by these standards. That’s why it is helpful to have a playbook of common issues and how you plan on addressing them during the contract negotiation process.
In this article, I cover the top 14 issues you will want to address in your IO Rider, from the perspective of both the Advertiser (or Agency) buying the ads and the Publisher or Media Company selling the ads.
Buy-Side IO Terms
1. Defining Impressions
Assuming you’re paying based on “impressions” (also known as Cost Per Mil or cost per 1,000 views), you only want to pay for “legitimate” impressions. For example, you will want to exclude click fraud or non-human traffic or bots; and unviewable (in whole or in part) impressions (example, if a video, only if the full video plays; for images, only if all pixels load). You may also only want to pay for United States-based traffic (e.g. excluding traffic from non-US IP addresses. FYI, payment can be based on other metrics besides impressions, such as click-throughs, registrations, etc., but the same principle applies. How do you precisely define what you will pay for?
2. Ad Serving
You want to ensure the “counting” (ad serving, tracking, and reporting) is done by a mutually agreed third-party ad server, and you reserve the right to reasonably dispute any traffic reports if your numbers differ.
3. Tracking and Data Collection Rights
You may use tracking technology on ads for collecting and tracking user data, consistent with the law and applicable privacy policies.
4. Compliance with Applicable Laws
Require the Media Company to comply with applicable laws. Privacy laws are the most important laws in this context, but of course, the buyer wants the seller to comply with all applicable laws.
5. Makegood Terms
If the publisher fails to deliver on any required promotions, they will deliver makegoods. And you get to mutually agree and approve over what makegood inventory you get.
6. Publisher Indemnification Obligations
You want the Media Company to indemnify you for (a) the content of the Sites in which Advertiser’s Ads appear, (b) any content or materials provided by Media Company (e.g. artwork, ad content, etc.), e.g., so it does not infringe; (c) compliance with laws (including privacy laws); (d) breach of confidentiality.
7. Editorial Standards
You may want to consider certain editorial requirements. For example, ensuring that traffic is reasonably evenly delivered, over the course of the campaign (not in just a few huge spikes). Another common editorial standard is to require that your ads do not appear near “inappropriate content” for the context of your ad. For example, if you’re advertising airline travel, it would be bad for business to appear next to an article about a recent plane crash.
Sell-Side IO Terms
1. Deadlines
Advertiser must meet reasonable deadlines (e.g., review of artwork and ad copy, sending you their artwork in the right formats, etc.). When you’re the seller, and you want the buyer to review ad copy, turnaround time is usually 3-5 days max. There will also be a general provision saying seller is not responsible for delays to the extent caused by the buyer.
2. Delays
Ad inventory is perishable – if you have a last-minute blank space, you may not be able to resell it for the same price. Therefore, if the Advertiser doesn’t approve artwork or ad copy on time, and you cannot run the ads, they still have to pay for your resulting unused ad inventory.
3. Commercially Reasonable Efforts
There are certain things you can try to do but cannot fully guarantee, for example, (a) you cannot guarantee 100% even delivery of impressions, because traffic can spike based seasonality or timing, (b) you can’t guarantee all editorial adjacency requests, (c) you don’t control whether international viewers might access the ads, etc. These are things you might want to qualify with “commercially reasonable efforts.”
4. Termination & Refunds
Because inventory is perishable, and because you’re pricing based on the entire ad buy, you will want to say the advertiser is not allowed to terminate for convenience and gets no refunds (except for if due to terminations due to your breach).
5. Makegood Terms
You’ll deliver makegoods, but not a refund, if you fail to deliver on any requirements and it was your fault. Makegoods will consist of replacement ads of overall reasonably similar value. (See number 2 above – No makegoods if it wasn’t your fault).
6. Compliance with Applicable Laws
Advertiser will comply with all applicable laws, including privacy laws (how they collect and use data), and, if applicable, any “Native Advertising” laws and guidelines. This means any ads that could look like content are clearly marked as advertising.
7. Agency Liability
When you are selling ads through an Agency representing the buyer/advertiser, you will want the Agency to represent and warrant to you as the seller that they have the authority to make binding commitments on behalf of the Advertiser (and indemnify you if they do not), and you will want them to indemnify you for infringement by any content they create or deliver.
Bonus Tip: If you are an Ad Agency, you will also want to ensure that you are not responsible for the Advertiser’s misdeeds, including their failure to pay. You will want to add disclaimers to that effect in both the IO with the seller and your separate agency contract with the advertiser.
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