'We are now a performance business': DoubleVerify's CEO on expanding beyond brand safety

DoubleVerify (DV) anticipates significant revenue growth from social-media solutions after the measurement tools it produces for social media surged 62% in its fourth-quarter 2023 earnings and now accounts for 43% of DV’s measurement revenue.  

The company, which started out producing brand safety tools, sees untapped potential in Meta-owned platforms despite more people using YouTube. DV's launch of brand suitability verification in January 2024 for Facebook and Instagram promises further revenue increases.  

Aside from Meta, DV is actively pursuing other growth opportunities in social through its partnership with TikTok and AI-driven short-form video content after acquiring Scibids.   

In addition, DV has also introduced a Made-for-Advertising (MFA) classification tool aims to refine ad-blocking processes, notably to support marginalised publishers and ensure balanced content filtering during critical periods like elections. 

Campaign spoke to Mark Zagorski, the chief executive officer of DoubleVerify when he was in Singapore for Campaign360. He discussed MFAs and how the company plans to invest in more AI and expand beyond ad verification. 

Adapting ad verification strategies

MFA websites have been allowed to exist for years within the digital ecosystem, contributing to disruption of user experience, devaluation of content, and creation of security vulnerabilities. 

Bad actors create MFA websites with the singular aim of diverting ad spending from bona fide publishers. They often feature low-quality content, including fake news, conspiracy theories, or dubious links.  

MFA websites employ strategies like pop-up ads, auto-play videos, and intrusive ad placements to maximise earnings for the site owner. MFA sites also make up 15% of ad spend, according to the Association for National Advertisers (ANA) in the US.    

A damning report from the ANA is spurring many advertisers to reevaluate their long-standing programmatic buying practices. As more becomes known about the MFA website menace, more key industry players are scrambling to protect themselves from it.   

Zagorski notes that as MFA became a significant topic in 2023, DV’s investments in AI classification tools are paying off. In September 2023, DV announced that it identified MFA sites as platforms primarily created to display ads.  

DV characterised these sites by a high density of ads relative to content, frequent ad refreshes to increase revenue per visit, and reliance on paid traffic sources like social and native advertising, with minimal organic traffic. The content on MFA sites often encourages continuous scrolling or clicking and may be duplicated across multiple sites or generated by AI. 

For example, a website may feature many ads while still registering high direct and search-enabled traffic rates. In this instance, the publisher would not meet DV’s definition of an MFA website. 

“I liken MFA to the ‘Internet's junk food’—cheap and effective but ultimately harmful. Yet, what is considered 'junk' to some may be viable to others, highlighting the absence of a unified industry standard for defining MFA,” explains Zagorski. 

“This lack of consensus is why we introduced a tiered MFA solution, offering varying sensitivity levels to meet different advertisers' needs. While this content might not be healthy for the ecosystem, it can drive engagement. Our tools allow advertisers to choose their exposure levels before and after bidding, encouraging responsible engagement without over-relying on digital 'junk food’.” 

Aside from MFAs, the digital landscape continually presents new challenges, like the recent discovery of an audio fraud scheme that DV named the ‘FM scam’. This involved 500,000 spoofed audio devices, including home speakers, used to falsify ad locations, siphoning over a million dollars a month.  

Adapting to these challenges means moving quickly and employing tools that evolve with the landscape. With AI driving more sophisticated fraud—evidenced by a 20% increase in fraud schemes in 2023—DV’s approach is to 'fight fire with fire’. 

This is where DV’s acquisition of Scibids, a company that uses AI to optimise and customise marketing campaigns, plays a major role. 

DV now has the ability to use AI to detect and counteract fraud, including manipulating ad bids and URLs as the complexity of managing disinformation, misinformation, and fraud grows daily, complicating the environment for marketers. 

“AI presents challenges for advertisers, such as the proliferation and amplification of inappropriate content, deepfakes, and fraud. However, we have developed AI tools that rapidly enhance our ability to classify content across multiple languages,” explains Zagorski. 

“For instance, this year with TikTok, we've quickly expanded to over 35 markets and multiple languages, transitioning from manual to automated translation to build our models."

Another use of Scibids is for campaign optimisation, with a global insights report by DV revealing that over 50% of advertisers spend substantial time manually optimising campaigns in Asia Pacific alone. 

DV can now optimise campaign performance using data and key performance indicators such as attention metrics, viewability, and ROI. The system automatically updates and optimises campaigns, allowing agencies to focus on other client-beneficial activities. 

“This shift represents a move from merely protecting ad spend to enhancing performance, leveraging our unique data assets like attention and viewability data. Scibids play a crucial role in this evolution, enabling us to implement these core data assets effectively,” explains Zagorski. 

With the impending signal loss from third-party cookies, Zargoski believes attention as a metric is poised for growth but is awaiting two developments in standardisation, as there are numerous definitions of what constitutes attention, much like the varying definitions of MFA. 

He admits with cookies still reliable for retargeting and attribution, there is not as much reliance on upper-funnel metrics like attention. However, Zargoski believes once cookies finally phase out, proxies for performance, such as attention, will become crucial. 

“We have been anticipating cookies' departure for a long time. Every six months, it seems they're on the verge of disappearing, yet they persist. As this happens, the data we gather on context and page content becomes increasingly valuable,” explains Zargoski. 

“In some ways, the industry's reliance on cookies is holding it back. It’s almost as though we need cookies to disappear to advance. At the moment, cookies are like training wheels for the industry.” 

Exploring new sources of revenue

While the industry has always viewed DV as a protective service because of its brand safety roots, essentially insurance against poor ad quality, DV believes its business fundamentally contributes to performance.  

By removing non-viewable ads, fraud, and ads appearing alongside hate speech—all of which do not sell products—Zargoski says DV inherently enhances the remaining ad performance.  

“We are, by extension, already in the performance business. What we are doing now is digging deeper, allowing advertisers even more control over their choices,” explains Zargoski. 

“For instance, brand suitability, as opposed to brand safety, which is very black and white, is tailored to an advertiser's specific needs. It allows them to choose from 70 different types of content, each with three sensitivity levels, to find what best aligns with their brand. This flexibility enhances performance and showcases our evolution from purely offering protection to providing both protection and performance enhancement.” 

Zargoski also sees potential in retail media networks, which are driving significant growth in the advertising sector.  

DV has invested heavily in working with some of the largest retail media networks globally, helping to curate inventory and enabling advertisers to apply brand suitability measures across these networks.  

“This focus on performance demonstrates the versatility of our tools, ensuring they are adaptable to whatever the future holds in media, be it retail networks or short-form video. Our core solutions must remain flexible to stay relevant in this ever-evolving landscape,” adds Zargoski. 

In its Q4 2023 earnings call, one significant point that was repeatedly mentioned is the globalisation of DV's business.  

Approximately 20% of DV’s measurement revenue originated outside the US when Zargoski was appointed as CEO in 2020. Four years later, that figure has increased to 31%, signalling a 11% growth in over just three years.

Another key development is the 51% growth in DV’s social segment in Q4 2023, now predominantly driven by short-form video. 

“These changes reflect our transformation from a predominantly US-based, open internet business to one that is increasingly global and intertwined with social media platforms. This shift mirrors the spending patterns of our international clients, such as Unilever, Mondelez, and Pepsi,” explains Zargoski. 

“These large global CPG companies significantly influence our business dynamics, as their expenditures on social media and international markets directly affect our revenue streams and the nature of our global agreements with them.” 

The road ahead

The APAC region continues to see promising growth for DV, with a 33% increase in revenue in Q4 2023 compared to the previous year. 

With this growth in mind, DV recently promoted Conrad Tallariti, previously regional vice president of sales to managing director for Asia Pacific to spearhead operations across the APAC region, driving growth and business momentum. The company moved Rahul Vasudev into the role of regional vice president for APAC after the Scibids acquisition.  

Zargoski notes APAC has been a leader in innovation, notably in social media and short-form video platforms like TikTok, which emerged more rapidly here than elsewhere. In addition, Australia has shown significant advancement in connected TV (CTV), which gained prominence here before North America. 

Even though TikTok is facing a potential ban in the US unless its parent company Bytedance divests from the platform, Zargoski is not worried even though social is driving DV’s growth. 

“The future of our engagement with TikTok remains to be seen despite our strong relationship, which was highlighted in our recent earnings call,” explains Zargoski. 

“Regardless of TikTok's fate, we will adapt effectively. Should advertising dollars shift from TikTok to other platforms like Instagram Reels or YouTube Shorts, we are prepared to follow and support our advertisers' spending across these new venues.”