The cost of a digital ad is one thing. The real cost of a digital ad is another.
Over the past 30 years, programmatic advertising (the automated buying and selling of digital ads) has come to represent over 50% of U.S. ad budgets, nearing $200B in 2022 alone. Programmatic advertising has been optimized for minimizing financial costs and maximizing reach—but the carbon cost of that technology has not been accounted for.
Here is a little-known fact: According to research published by The Shift Project, nearly 4% of global greenhouse gas (GHG) emissions are caused by the internet, totaling 1.6 billion metric tons. Compare this to the aviation industry, which is responsible for nearly 5% of global GHG emissions. That’s right: The internet and the aviation industry are nearly tied for GHG emissions. And what powers the internet? Digital advertising. So between the ad dollars that support everything from search engines to cooking blogs, digital advertising is responsible for a significant portion of that carbon footprint.
“Data centers are the factories of the 21st century. We just can’t see the smoke.”
– Anne Coghlan, Co-Founder and COO
Making Digital Advertising Sustainable
Scope3 is on a mission to make digital advertising sustainable. When Anne Coghlan, Co-Founder and COO, and her co-founders started Scope3 they set out to help businesses understand and reduce their advertising-related emissions. Scope3 developed a methodology that measures the end-to-end emissions of an ad’s delivery across the entirety of the digital supply chain. From there, they can include the price of offsetting those emissions into ad delivery to reflect the real cost of digital advertising.
Another critical piece of the Scope3 model is to create a direct path to carbon removal purchasing. Scope3 chose Carbon Direct to embed carbon compensation into their Green Media Products (GMPs) with a bespoke carbon removal portfolio. By purchasing a GMP, advertisers can automatically compensate for emissions from their advertising campaigns.
“Our theory is that if we get brands on the buy side to price carbon into decision-making, then that would incentivize the supply side to reduce their emissions. We didn’t have a solution for that until we worked with Carbon Direct.”
– Anne Coghlan, Co-Founder and COO
The Scope3 Portfolio is an advance purchase of $1 million in carbon credits allocated across a diversified pool of nature-based and hybrid carbon removal projects. Like a financial portfolio, diversification of carbon projects helps to mitigate risk and maximize benefits. With carbon credits, the main risk is re-releasing carbon into the atmosphere. Carbon Direct rigorously vets the durability of each project and assesses benefits like ecosystem conservation and economic contributions for the community. Every purchase from the Scope3 portfolio represents 1 metric ton of CO2e removed from the atmosphere as a composite credit, or fractional slice of each project based on the portfolio composition.
With Scope3, any organization in the digital advertising industry can not only understand the carbon emissions driven by their campaigns, but also learn how to reduce those emissions and compensate for any remaining emissions. Looking ahead, Scope3 plans to continue to work with Carbon Direct to automate carbon removal purchasing for those unavoidable emissions through Carbon Direct’s Purchasing API.