On September 9th, 2024, the Australian parliament passed the Treasury Laws Amendment bill. This will introduce new mandatory climate-related reporting for medium and large-sized companies, including disclosures on climate-related risks and opportunities for greenhouse gas emissions across the value chain.  For larger companies this will start as early as next year, with over 6,000 Australian entities required to report by 2030.

This means many brands will need to ensure they are able to measure the carbon footprint of their media plans over the next few years, depending on their size. It’s then likely to be incumbent upon marketers to use that data to reduce the size of that footprint.

For some marketers, it might be tempting to take a “we’ll cross that bridge when we come to it” approach and wait until they are closer to their regulatory deadline. That’s understandable in the current economic environment when it can be hard to prioritise initiatives that aren’t tightly aligned with campaign performance.

However, delaying implementing measurement tools would be a mistake.

This is because beyond the simply altruistic – worldwide carbon emissions must be reduced by 45 per cent by 2030 and reach net zero by 2050 to avert the worst impacts of climate change – brands that have already begun their sustainability journeys are finding that optimising for carbon reduction is making their campaigns more efficient, and often more effective.

Here’s why.

The positive correlation between campaign performance and lowering carbon

Programmatic display advertising alone generates 3.8 million metric tons of CO2 every year (the equivalent of 17.2 billion kilometers driven in the average car).

Yet, when you start to dig into the granular insights that carbon emissions data unlocks it becomes clear that carbon is a flashlight for inefficiency and waste.

Every year, one million metric tonnes of CO2 is emitted to serve non-viewable impressions, equivalent to more than 4 billion kilometers driven in a car.  Further, 15.3 per cent of display ad spend is wasted on made for advertising inventory which typically has 26 per cent higher emissions.

Take out the waste, including made for advertising (MFA) sites and problematic placements, and you start to eliminate both wasted carbon and wasted media dollars for inventory.

Brands should begin to think of their media strategies in terms of “making carbon count”; any emissions generated should deliver value back in the form of performance.

Let’s look at how two Australian brands have done just that.

Bank Australia reduced carbon emissions from its digital advertising by 44 per cent without impacting campaign performance

Bank Australia has environmental purpose at the core of its business, in building its operations, investments, and community initiatives. In addition to its clean money promise, it strives to minimise its own environmental footprint. It’s been carbon neutral since 2011 and has set a net zero target by 2035 – the most ambitious of any Australian bank.

Having made impressive reductions in carbon emissions across its business operations, Bank Australia’s marketing team were keen to understand how they could contribute to achieving a net zero target by 2035.

Scope3 set out to establish a baseline for typical performance and carbon emission measurement across 12 different campaigns across display, native and video via its typical digital media buying strategy. Scope3 helped optimise their campaigns, identifying and removing waste, including high-carbon emission sites amongst the bought inventory.

After Scope3’s optimisation, a significant 44 per cent reduction in carbon emissions was achieved across the 12 campaigns. Moreover, all KPI and hygiene metrics were either met or, in many cases, exceeded.

Per campaign, KPIs like CPA reduced, while viewability and CTR rates increased. Additionally, media waste was further reduced by eliminating high-carbon (MFA) sites. For example, for one display campaign, acquisition costs went down by 6 per cent and emissions decreased by 13 per cent.

University of Tasmania lowered emissions by 30 per cent, boosted converstions 264 per cent

The University of Tasmania is ranked #1 in climate action globally, according to Time Higher Impact Global Rankings, and is committed to leading the way for a sustainable future. Consequently, University of Tasmania was keen to understand how it could measure and take action to reduce carbon emissions.

Scope3 worked with University of Tasmania to optimise digital campaigns from March to May 2024, actively targeting away from climate risk inventory (high-carbon websites) which led to improvements in three key KPIs.

University of Tasmania reduced its carbon emissions from advertising by 30 per cent, but significantly was able to simultaneously lower gCO2pm (the grams of carbon per 1000 impressions) by 76 per cent whilst achieving a 264 per cent conversion rate.

A win-win scenario

What’s key to note here, is that as brands that have sustainability at the heart of what they do, both Bank Australia and the University of Tasmania sought our help to measure emissions with a view to focus on carbon reduction only. They have both realised business outcome gains by improving campaign performance as well as reducing emissions has been incremental to their original goal.

It also demonstrates to other brands. which may not have sustainability quite as high on their agendas, that optimising to reduce carbon reduction is incredibly good for business, as well as the planet.

To find out more about how you can make positive changes to both sustainability and performance, Scope3 at www.scope3.com