the due diligence desk

Before you buy holdco supply or platform AI: the conflict questions

Holding companies now own pieces of the supply they buy from, from Stagwell's Freestar to Publicis's Epsilon, Lotame and LiveRamp, and the deals have come with no published firewall, disclosure rule or margin. At the same time, OpenAI and Meta switched on AI rewrites of ads by default after changing their terms so the advertiser carries the risk. Both put decisions about your money in the hands of a party with its own interest.

1. Does your parent company own any SSP, publisher network or data company in our supply path, and which ones?

   Stagwell now owns Freestar, which sells ads for more than 1,000 publishers, and Publicis owns Epsilon, bought Lotame and agreed to buy LiveRamp.

   Prompted by ADOTAT: The Field Kit: Stagwell Calls Freestar a Shorter Supply Path. It Now Owns Both Ends.
2. For each of the six seats in our programmatic buy, who is the parent company?

   Every programmatic buy passes through six seats, and one parent in two of them is a conflict to disclose.

   Prompted by ADOTAT: The Field Kit: Stagwell Calls Freestar a Shorter Supply Path. It Now Owns Both Ends.
3. When you bid on inventory your parent sells, what written firewall covers its bid data, floor prices and publisher yield?

   Stagwell's Freestar announcement describes no firewall over Freestar's bid data, floor prices or publisher yield.

   Prompted by ADOTAT: Stagwell Says Publishers Come First. Its Freestar Deal Now Feeds Principal Media.
4. Is any of our spend bought as principal media, and what margin do you keep on it?

   Stagwell's Owned Media chief said Freestar will help improve Stagwell's own principal media buying.

   Prompted by ADOTAT: Stagwell Says Publishers Come First. Its Freestar Deal Now Feeds Principal Media.
5. Which AI changes to our ads are on by default, and can we switch each one off before launch?

   OpenAI can now rewrite headlines, translate copy, resize images and change the landing page without advertiser approval.

   Prompted by ADOTAT: OpenAI and Meta Call It Enhancement. You're Liable for Ads You Never Read.
6. Who answers for an AI-rewritten ad we never reviewed, and what is your liability cap?

   Meta's revised terms make advertisers solely responsible for AI changes Meta switches on itself, and OpenAI caps its liability at six months of spend.

   Prompted by ADOTAT: OpenAI and Meta Call It Enhancement. You're Liable for Ads You Never Read.
7. If an AI agent buys media for us against a sales target, how do you stop it from chasing customers we already have?

   Ehrenberg-Bass scientists warn an agent given a sales target will chase existing customers, the cheapest sales to claim, and quietly shrink the brand.

   Prompted by ADOTAT: AgenticAdvertising.org Says Brands Grow Through Love. Ehrenberg-Bass Says Love Is Rare.
8. How do AI answer placements perform and price against standard search ads, and will you report them separately?

   Google's ad chief conceded AI Mode monetizes less, as Alphabet search ad growth fell from 19 percent to 12 percent in two quarters.

   Prompted by ADOTAT: Wire & File: Google Says AI Drives Query Growth. Its Ad Chief Says AI Mode Slowed Search Ads.

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