Revolutionizing Media Supply Chains: Transforming Carbon Data for a Greener Future
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Welcome to Episode 14 of the Breaking Through the Mayhem podcast, where we explore marketing and advertising in a time of constantly shifting risk and opportunity.
Brought to you by Sightly, our goal is to share the insights of industry leaders from brands, agencies, publishers, and partners as they discuss the challenges and possibilities emerging from the ever-shifting media landscape, such as real-time marketing, brand safety and purpose, influencers, cancel culture, data privacy, technology and more.
Today's guest is Eric Shih.
Eric Shih, the Chief Operating Officer of Cedara, shares his unique career journey, from the music industry to TV and ad tech, culminating in his arrival at Cedara driven by a personal passion for a sustainable future. This episode delves into Cedara's mission to map carbon emissions in marketing and advertising, emphasizing the industry's crucial need for a sustainable supply chain. Eric highlights the role of transparency and data-driven measurement in achieving net zero targets. The conversation explores collaborative efforts across the supply chain, stressing the collective responsibility to make the advertising industry more sustainable. Tune in to this insightful episode where sustainability meets advertising innovation with Eric Shih.
The Breaking Through the Mayhem Podcast - Episode 14
Title: Revolutionizing Media Supply Chains: Transforming Carbon Data for a Greener Future
Host: Annalise Curvelo, VP of Business Development & Partnerships
Guest: Eric Shih, Chief Operating Officer at Cedara
Recorded on January 4th 2024
Welcome to Sightly’s breaking through the Mayhem podcast. I'm your host, Annalise Curvelo, and I'm so excited to be kicking off the new Year with an amazing guest today, Eric Shih. Eric is the chief operating officer for Cedara. Cedara is a carbon intelligence platform and one of the leading sustainability measurement companies in our industry. Eric, thanks so much for coming on the show today.
Thanks for having me. Annalise. It's a real pleasure to be on the podcast and very excited to obviously be speaking to a company really leaned in on this topic.
Awesome. So to start out, can you give our listeners just a little bit of background about yourself and how you've navigated your career over the years in the advertising and tech sectors?
Sure thing. It's a bit of an interesting career path on my side. I started working over 20 years ago now, showing a bit of my age, but I started working at technology startups, a couple of different ones when I started my career. So I really started in technology, but I had a bit of a mid twenties crisis and at that point I actually thought I was going to work in the music industry.
So a little bit of back story. I was a DJ for 15 years, like playing at clubs. I really thought I was going to end up working on a record label. I actually went to grad school for a music business degree, but it was at a time when digital was disrupting the music industry. So jobs weren't that great at the time.
And the outlook wasn't great for the industry. So I actually made a jump into TV at a music television network, called Fuse if anyone remembers what that was. But I ended up spending ten years in the media industry, cable television networks and digital media, and ultimately pivoted another time into ad tech. And I ended up at Teads for many years on the leadership team there, and that's how I got into advertising.
I was sort of touching advertising by working, working in TV. But Teads got me really into the ad tech world and then ultimately how I ended up at Cedara, which is founded by a number of folks that I worked with at Teads as well.
That's awesome. We're definitely going to need to set up time to hear more about the DJs phase. Do you ever still deejay like in your free time?
You know, these days I'm definitely retired. I've played a few and far between. Maybe like the occasional wedding when one of my friends asks. But it's very rare these days.
That's fun. That's awesome. And so how did you what drew you to the realm of sustainability in particular?
Yeah. So, I mean, it ties into the fact that I think a lot of us at Cedara, at least in the commercial side of the business, we all came from the media industry for the most part. We also had long careers in ad tech, actually a bunch of us that came from Teeds as I mentioned, but we were all very passionate. I think that unified all of us that we were very passionate about making an environmental impact.
A lot of nature lovers, just a lot of people just generally want to do good for the planet. And we all left our respective paths and our different jobs and careers. We wanted to find a way to make an impact, Right. We had to figure out a leading media industry but still leverage the experience and skills that we had and Cedara really presented that opportunity, right?
It's sort of the intersection of media and sustainability, and there's already this great momentum in the industry with ad net zero with, you know, that people recognize the marketing industry represented like 4% of carbon emissions globally. So there was work to be done within the industry and not everyone obviously go and pivot into working in oil and gas or logistics or manufacturing.
So we had to think about how we could make a difference with obviously the experience that we had. And this was an obvious way for us. And also on a personal level, I just had twin babies like early this year, so I started thinking about how do I look out for their future versus mine. And this is just a great, great way for me to think about doing something good for them.
Aw I love that. Congratulations on the twins by the way. That's so cool, because I think it's really awesome when there's personal passion that can align with a career opportunity. It's really not every day that you see that, and it's really inspiring to hear your story and, you know, hopefully that can motivate others to find those intersections of where your passion aligns with You know, what you're good at and what you already know.
Absolutely and for anyone listening in trying to think about how they can make the switch or make an impact, definitely connect with me. I love connecting with people that are trying to do the same thing and give advice on that is we've been through it and have a lot of advice to give.
Thank you for that. That's awesome. So for our listeners, that may not be as familiar. Can you tell us a little bit more about Cedara and what the mission is? I know we've gotten a little bit into it (sure) but yeah.
So I guess we'll start the mission right? We started the company with really the goal of mapping carbon emissions across the marketing and advertising ecosystem and ultimately using that data to provide actionable intelligence as we describe it, to help our industry achieve net zero and also ultimately the companies with it achieve net zero. How do we provide that intelligence?
Ultimately, our company provides the SAS solution, which is the carbon intelligence platform, and this SAS solution allows anyone in the media ecosystem, it could be brands, could be agencies, platforms, publishers really use it to comprehensively measure their carbon footprint, reduce compensated emissions if they want, and really build that strategy right, to be able to share that data widely in the ecosystem so everyone can help the industry get to net zero ultimately.
And as you said, there's been so much momentum on the topic of sustainability. It's become a very important topic for everyone, really. But even in the advertising industry between publishers, ad tech and the industry in general. So can you tell us a little bit why it's crucial for organizations, particularly in our industry, to prioritize building a sustainable supply chain?
Sure. So I think it's good to provide a little background on where emissions are sitting in our industry, particular. So if you look at advertising, this is very similar to other other industries as well. The bulk of carbon emissions actually sit in our supply chain over 90% actually actually of our carbon emissions will sit in the supply chain and that is ultimately in the form of what's known as scope three emissions.
So probably good to take a step back and give everyone a primer on what the different scope emissions means. Well, there are three scopes of emissions as defined by the Greenhouse Gas Protocol, which are a framework for measuring carbon that companies or the majority of companies use across industries. So scope one emissions are emissions that come from any direct energy that you use as a business.
So think about a coal powered factory. It doesn't really exist in the advertising industries so not as relevant, but scope two emissions are relevant. It's the energy you purchase as a business. So that could be electricity you buy for your offices or natural gas you're purchasing. So there are some of that in our industry, but most of the emissions that really sit are in scope three and that is emissions coming from what's known as your value chain or your supply chain.
Everyone that you work with in your day to day business. So if you can think about things like the business travel you're doing, scope three emission or office supplies you're purchasing, but ultimately the bulk of scope three emissions for our industry are from media delivery, right? So actually delivering the ads and the companies you're working with to deliver those ads.
So when we talk about supply path and optimizing, it's really optimizing the suppliers or vendors or publishers you're working with. So in that vein, it's really critical to measure the footprint of all the suppliers you're working with, and that's how you understand how you could optimize and reduce your own emissions as a business. And you're seeing this sort of happening across many supply chains, not just advertising.
So brands, which are companies at the end of the day, are already like knocking on the door, all of their suppliers and different supply chains and asking for emissions data because many of these brands have net zero targets. So a great recent example was Amazon. Amazon announced late last year that all of their suppliers will need to report emissions back to them starting this year in 2024 with reduction targets.
Microsoft has had this in place. There are dozens of other examples and now you're starting to see that trickle down to the media industry where an organization called Garm, which is the Global Alliance for Responsible Media, which is part of WFA, they actually released an action guide earlier last year at Cannes basically say the number one action for brands right now is making sure your suppliers are sustainable and measuring their suppliers because that's the number one action a brand could take to decarbonize their business, which is a huge basically a confirmation of what is happening in other industries today.
That's really interesting, especially because, you know, I think most people are still a little bit confused on this topic. And, you know, I was a little bit confused until I started talking to a lot of people in the space in particular, because you think about, you know, the things that come to mind immediately when you think about reducing carbon emissions are things like electricity bills for a big corporations office or business travel or big splashy media activations and things like that.
And those seem to be, you know, the things that are obvious as far as how a company can reduce carbon emissions. But, you know, a question that came up a lot is like how does a company like Sightly for example, where fully remote we don't have any office space, so no electricity bills, we don't do a ton of business travel.
We're not out there doing, you know, really splashy in-person marketing activation. So where do we start? And, you know, as you said, it's the supply chain. It's where we're buying media. And can you remind me, what did you say was the percentage of emissions that that scope three and supply chain is contributing.
Yeah. So over 90% which is massive right that's ultimately what you need to tackle to reduce your own corporate emissions your scope three emissions and that that's what the a real challenge will be for most companies in our industry. Right but see your question right like what can you do from a Sightly perspective, given that you've taken all these great steps already, But first off, congratulations to Sightly because you're already in a major advantageous position being fully remote, sort of like our business.
So you eliminated a lot of the potential source of emissions. But as we talked about. Most emissions will sit in scope three and media delivery in particular for your business. So really the first thing that you and other businesses need to do is to get to transparency on where those emissions coming from in scope three, right, is that you need to have understanding of the carbon footprints of your vendors they work with who's contributing the most emissions in your supply chain.
Then once you have all that data, then you can start thinking about how do I think about reducing over time, how do I set reduction targets and how do I work with my partners at the end of the day to make sure that they're setting reduction targets on path, on a path that's in line with my company, Your company, right.
And you set a reduction target. Your other suppliers should be on that same path. And that's what's happening right in other other supply chains. This is why I like that Amazon example, why they're demanding that data from their suppliers with reduction targets, because Amazon has a goal in mind and their suppliers need to follow suit. You know, for us, we also try to work with companies on advising on how they could reduce emissions further through technology.
So we've actually introduced our what we call a reduction marketplace in our platform, which is a number of third party solutions that you could use to reduce emissions either at a corporate or campaign level. We run the campaign business, and that's just another way to think about reduction, right? Maybe it's compressing the assets we’re using to save more data or throttling bits within the platforms are using any way to save energy, save carbon.
And the last thing I need to note for yourself and other companies, this is a long term mission. There is no like quick win overnight, on scope three. And this is why companies are getting started now at other supply chains. The goals like 2030, 2040 or whatever the year is, it's not like a win that happens overnight this year, it's that it takes investment and work with your partners.
But I think we have a good path in our industry because everyone is sort of aligning around this objective that's what we really need to advance us forward.
Yeah, the collaboration is definitely going to be crucial here because there are so many pieces of the supply chain in the advertising industry. Right, there are so many parts. I have a million questions, but one just for a reminder for our audience. So if a company pledges to be a net zero by 2035, let's say, can you give our audience a reminder of what the requirements are to achieve that?
Sure. So there is the organization that knows net zero, which I'll start with, which we are supporters of. So net zero, which started a couple of years ago has about 200 plus companies and today across different countries, including the US obviously, but the UK, Australia, New Zealand and Ireland. But of those companies which are representative of different big brands, big agencies and platforms and publishers, Ad Net zero has told all those companies that everyone needs to have a net zero target, a science based net zero target in place within the next 12 months.
So what does that mean? Well, a science based target is typically one that's set with the Science based Targets Institute, which is an organization that's known as SBTI. It's sort of the de facto standard, right, for companies that want to set a target and achieve net zero. But what is net zero mean? Well, it's actually a number of steps that you have to take. If you set the net zero target,
There's a near term target that you need to achieve, which is by 2030, and that target would be reducing your emissions by 50% as a business. Just at a most basic level. There are some nuances there depending of the size of your company. But then 2050 is the real sort of nut that everyone needs to tackle is that you should reduce your total emissions by 90% by 2050 and then the remaining 10% you can actually offset to get to net zero.
So as I mentioned, this is a long term play, but companies need to start now and there are ways to get to this goal. It's just it does take collaboration, but it takes again, investment and really focus as a company to get there, which I think is doable.
Yeah, and that's what you guys are doing, right? You're helping (exactly) people achieve that and measure that. So can you get into a little bit about how it all works? Like how does the platform use data driven measurement to measure that same sustainability in the carbon emissions?
Yeah, definitely. And you know, it really comes to the so the foundation of our platform where the foundation of our platform ultimately is comprehensive corporate measurement of emissions for companies that are in the media supply chain. So if you think about corporate measurement, it requires you to have lots of data, lots of actual data from vendors to do the measurement.
And this is how carbon measurement works in other industries for other companies. But the data we're getting if you think about using data across the organization. It's both corporate overhead data, like the business travel you're doing or the energy or electricity purchases you're making. But also all the media activity, which is like all the impressions you might deliver of the business.
Or all the bid requests you do as a platform, the data center that you're using and the emissions from your data center, if we pull from AWS or whatever else you might be using in the business. So we're getting all that data into the platform and translating that into carbon through what's known as emission factors, which are our coefficients.
Or let's boil down the topic later is at that turn spending activity data into carbon data. But ultimately it's data driven in that fact that we work with companies to get their actual data to transform to or measure carbon. And we're not using estimates. Like this is the challenge that the industry has sort of dealt with as they try to as it tries to start it off like sustainable media approach is it relied on estimates because most companies are not measuring their emissions in our industry, at least not yet.
But the problem with estimates is, as I think we all know, was that there's a high degree of error and you can't rely on estimates to get to net zero because how do you prove actual reduction without working or knowing the data from a company? So this is what we're trying to solve. This is an ambitious goal. Obviously it doesn't happen quickly.
It takes time, but that's our approach and I think that that mirrors the approach that we're seeing in other supply chains. And that's what we'd like to take on to see is the best practice and standard, if you will, that companies are already doing so across other parts of the business.
Yeah, and I think a really bite sized way to understand kind of like a starting point for people or for advertisers in particular is what you allow brands to do within the platform at the campaign level. Can you talk us through that just a little bit more? So you know, you're able to offset the emissions of a like one particular campaign.
How does that work and what kind of feedback have you guys gotten from that?
Yeah, sure. So the first step, obviously, is being able to measure the impact of emissions on a campaign level. The great thing is that when you're measuring a business, in particular an ad platform or a publisher, it's delivering campaigns or even an agency. You're getting all this media activity data. All of this campaign delivery data so in our platform, we were able to automate the measurement of those campaigns that scale if we're getting all this data anyways because we needed to measure the scope three emissions for the company, which is part of corporate emissions.
So now that we have all that data, we can do the measurement. We could break it down at a campaign level. Well, now you can understand, well, hey, Campaign X generated one time missions. We had that data, see that we have a built in, as I mentioned earlier, a reduction marketplace that you could use to reduce emissions by using third party solutions or an offset marketplace.
So an offset marketplace will allow you to compensate for emissions which you can't reduce at the end of the day right. So and that allows you to buy what's known as carbon certificates. You're basically investing in carbon removal projects. There are 60 some odd carbon removal projects in our offset marketplace. So verified and curated across different technologies, right? A carbon removal project could be something as simple as planting trees in a forestry project or something more and more advanced, like direct air capture, which companies are building huge machines that suck carbon out of the atmosphere.
But ultimately our platform allows you to to choose what you want to invest in transparently and then apply those certificates or removing carbon to removing the carbon from the campaigns you’re delivering. Right. So it's a seamless way to to compensate in our platform.
Yeah, that's awesome. And actually like the extreme examples there because you know, there's campaigns of all different sizes and budgets. So it's cool that the options for, for any type of campaign that advertisers might be running. Yeah. Okay. So one, one question that's a little tricky that I have is is there a couple parts of the supply chain that are most responsible for highest the highest carbon emissions, or do we all share the same responsibility to make the advertising industry a more sustainable place?
So I think it's more your latter point, right? We don't we don't try to call out companies or parts of the industry that are generating more emissions that in another it's sustainability. And getting to net zero is, as we sort of hinted at throughout our discussion here, is a collective effort, it's collective responsibility. So if you think about our supply chain in the media world, each level of that supply chain has an impact on the level above it.
So like a publisher's emissions will obviously impact the ad platform that's buying inventory than a publisher and same with the AD, the SSP impacted the DSP above it and the DSP impacting the agency. So at the end of the day, to lower the emissions in the industry, you need each level of the supply chain cooperating because it has a knock on effect for each of the parts of the supply chain.
But you know, the way to get there, I think for our industry is there's a few things that are coming together which will help us work together. And a lot of it could be financial pressure, right? Because most companies won't really do anything unless there is some financial incentive or disincentive to take action. And we're starting to see that with Garm, which I mentioned.
How brands are trying to lean in and get carbon data from their suppliers. But it's going to mirror what's happening in other supply chains where if you don't provide the data or if you don't try to be transparent with your emissions, you could be removed from the supply chain long term because the goal of these companies and brands at the end of the day is to get to net zero.
So you're not cooperating in helping companies get to net zero. There could be less of a chance like these days. Supply chain at the end of day, of course, is a long term you know, it is a long term initiative, but even beyond the financial incentives, there is regulatory pressure. So in Europe today already and in the UK, there's already a requirement for tens of thousands of companies to report carbon emissions.
And we're seeing that start in the U.S. with California, most recently with their legislation. And then FCC will likely follow on at some point with their own requirements. So it's coming and it's coming at a rate that will increase as we get closer to net zero target years. Either the pressure will increase that either companies or shareholders or government regulators.
It's just a matter of timing at this point.
Yeah, time is now to start thinking about this everyone, you heard it from Eric. We all have to do our part. And I think I'm really hopeful to see the advertising industry become a more sustainable place. So we love what you're doing and we really think others will too. Is there a good place for people to learn more about you and Cedara?
Sure. I mean, definitely Check us out on LinkedIn. You could find us there, but our websites Cedara.io, we're actually relaunching our site this Friday, which is January 5th. But if you're tuning in later, there'll be much more information on the company. The products there. And yeah, if you want to follow us on all social channels or there, Twitter or Instagram, you bet. Give us a shout.
Awesome well, thank you so much for coming on the show. It's been an absolute pleasure and.
Thank you again, Annalise it was definitely a pleasure chatting with you and hopefully educational for the audience. And yeah, let's work together and make a difference in our industry.
I love it. Thank you.