Insertion Order (IO) – Everything You Need to Know

Once everything is set up in digital advertising, most tasks happen automatically behind the scenes. This means less direct interaction between publishers and advertisers. However, direct deals are on the rise, making formal agreements between them increasingly essential. That is where Insertion Orders (IOs) play a key role in the process.

Insertion Orders are the final agreements that seal direct deals. Rather than juggling with a lot of paperwork to make these direct deals happen, the ad industry uses innovative methods to manage transactions through IOs. They serve as the final agreements that formalize the terms and conditions of these transactions. 

Let’s understand this better.

What Is an Insertion Order (IO)?

An insertion order in advertising is an agreement between a publisher and an advertiser to run an ad campaign. It is the final step of a direct deal. Once an IO is signed, the advertiser has to honor the pre-agreed terms for the specified period. 

Creating and signing insertion orders digitally through a vendor like DocuSign is a digital insertion order. Both serve the same purpose, but a digital IO agreement is more convenient in today’s global business ecosystem. 

IO typically contains all crucial parameters of the advertising campaign. This includes,

• Starting date,
• Ending date,
• Ad unit dimensions and placements,
• Target audience to be covered,
• Number of impressions to be served,
• Pricing Structure, and
• Cost of the campaign.

Are Insertion Orders Legally Binding?

Insertion orders are your legal protection. Once you and the advertiser sign on the dotted line, you have got a binding contract. This means the advertiser is committed to the terms – payment, ad specs, everything. If they want to change anything, it's not happening without a new, signed agreement.

Note: Do not get confused between the Insertion Order and Deal ID.

How is Insertion order (IO) legally binding?

Insertion Orders (IOs) are more than just paperwork. They're your legal safety net. Let's break down why:

• Clear Deal, Clear Signatures: Both you and the advertiser agree on the terms and sign off. This isn't just a handshake deal; it's a formal agreement.
• All the Details Matter: IOs spell out everything: when the ad runs, where it goes, what it looks like, and how much it costs. This crystal clear info prevents misunderstandings later.
• It's Official: Signatures make it official. This makes the IO legally binding, protecting your rights and ensuring the advertiser follows through.
• The Fine Print Matters: IOs often include legal terms about payments, cancellations, and disputes. This safeguards your business.
• Changes? Get It In Writing: If something changes, make sure it's documented and signed by both parties. This keeps the IO valid and enforceable.

‍Benefits of IO in Advertising

1. Precision: This one is a no-brainer. The purpose of creating an insertion order is to ensure that the advertiser knows what they will get out of a deal. This avoids any conflict in the future.  On the other hand, publishers know exactly what needs to be delivered and how much they will earn once the deal is complete. The insertion order pre defines the terms in black and white, and the chances of disagreement between the parties later become minimal.
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2. Flexibility: Another unbeatable advantage of insertion orders is flexibility. Publishers are allowed to customize what they provide. Different ad formats can be tested, and the deal can be modified in the future based on what format works best for both parties. But if both parties feel that a skyscraper ad unit would work better for CTRs and bettering UX, it is possible to make that switch. Amendments can be made after the advertiser understands and agrees to the new specifics.
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3. Rapport: Let’s say a publisher monetizes their inventory with an ad network. There is no interaction between the publisher and the advertiser. Ads displayed on the site are winners of a bidding war that no one witnesses. A publisher is just one of a million other suppliers to the advertiser. However, both parties have a clear line of communication when they use IO to secure a direct deal in advertising. During the negotiation process, the back-and-forths bring in an old-world camaraderie between supplier and buyer. Both parties can build a long-lasting partnership and deliver a better experience to the readers.
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4. Accountability: An insertion order is a legal document. It clearly defines the advertiser and publisher's responsibilities, minimizing the risk of disputes or misunderstandings. If things go wrong, the IO provides a clear framework for addressing the issue.
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5. Performance Measurement: The IO lays out specific performance metrics, like impressions, clicks, or conversions. These metrics provide a clear way to measure the success of the campaign and make data-driven decisions for optimization.
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6. Revenue Assurance: An insertion order is a guarantee of payment for the publisher. It outlines the advertising rates and payment terms, ensuring that you get paid on time and in full.
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7. Inventory Management: The IO helps publishers manage their inventory effectively. By clearly defining the campaign parameters, including ad placements and sizes, publishers can optimize their ad space for maximum revenue.

Best Practices In Using IO

• Mitigate Discrepancies and Ensure Accuracy

Digital advertising is prone to fluctuations. To avoid disputes, use historical data to estimate impressions and CPM, while considering possible fluctuations. This proactive approach ensures that both parties have realistic expectations.

• Verify Partner Legitimacy

If working with intermediaries, thoroughly check their credibility. Ensuring their legitimacy safeguards the campaign's execution and prevents unforeseen roadblocks.

• Prioritize Document Retention

The insertion order is a legally binding agreement. Maintain meticulous records of all signed IOs, including digital backups. This documentation protects your interests and provides essential evidence if disputes arise.

• Foster Clear Communication and Collaboration

Regular communication is key to a successful campaign. Establish clear channels for both parties to discuss campaign performance, address issues, and make necessary adjustments. Open dialogue fosters trust and ensures that both parties are aligned throughout the campaign.

• Include Cancellation and Termination Clauses

While collaboration is ideal, unforeseen circumstances may necessitate early termination. Include clear cancellation and termination clauses in the IO, outlining the procedures and potential consequences for both parties.

• Consider Legal Counsel

For complex or high-value campaigns, consulting with legal counsel can help protect your interests. A legal professional can review the IO and provide guidance on potential risks and liabilities.

How to Prepare an Insertion Order?

An insertion order in digital advertising serves many purposes. It varies greatly depending on the type of deal and ad campaign type and desired outcomes. So, analyzing the offer and determining possible pathways to hitting deliverables is considered the best practice. However, this is an insertion order template that any publisher or advertiser can refer to or use as a base template.

Insertion Order Template

As an alternative to the above, we have added the IO template below, which you can use. 

What should an insertion order template cover?

You need to make a comprehensive insertion order to make it specific and detailed. A few of the usual things that it should cover are:

• Campaign details: ad size, dimension, type, placement, and timings)
• Campaign performance metrics and reporting: Key performance indicators of the campaign like impression, CTR, and conversions.
• Billing and payment details: CPM, cost of the campaign, preferred method of payment, payment data, and penalties on late payment.
• Warranty and liability: This clause includes the deliveries that are guaranteed under contract and the responsibilities of both parties.
• Force Majeure: The clause frees both parties from responsibilities in case of unexpected causes that prevent them from fulfilling the contract details.
• Clause on cancellation: Clear procedure for IO agreement cancellation, penalties associated with it, and notice period. 
• Terms and conditions: Additional terms, responsibilities, and conditions that both parties should follow to prevent future disputes.

Limitations of Insertion Orders

Despite the positives mentioned above, insertion orders have their drawbacks. For publishers of a certain size, it might become difficult to manage multiple orders, track earnings, and negotiate a higher CPM if there is a sudden increase in site traffic. Also, for a publisher serving millions of ad impressions monthly, it might become tedious to forge direct deals with every advertiser looking to buy ad inventory. Negotiations are time-consuming, and it is often weeks before both parties ink the dotted line.

Insertion orders do provide a structured approach, but they can be slow and limiting. They can take forever to set up with all the back-and-forth. Plus, you are stuck dealing with just a few advertisers.

Also, tracking money and ad performance can be a manual headache. And forget about making quick changes – it's next to impossible.  

This Is Why Programmatic Is the Future

We all have to agree on the fact that programmatic is attracting a lot of digital ad spend lately.

87% of all U.S. digital display ads will be bought via automated channels in 2026.

This means that more of the global advertising budget will flow through programmatic channels in the future. And direct deals (especially one-to-one) could be replaced by Private Marketplaces in the near future. So, insertion orders, in the long run, could be on their way out.

If you can sell all your remnant inventories to the best possible CPMs, would you not prefer it? And, it is challenging for most publishers (think mid-market) to find buyers to sell all available ad impressions through direct deals.

Time-Consuming:

While IO contracts are just the final document showing campaign details, there are a whole host of negotiations and processes to go through to secure deals. It takes time to agree on the terms and conditions. Besides, most publishers would love to skip the back-and-forths with advertisers.

Shrinking Demand:

It’s not just publishers; advertisers are also willing to let the algorithms do the job. It reduces effort and guarantees better returns. With the advancement of DSPs and Ad Exchanges, the ROI of programmatic advertising has become high. Thus shrinking the demand for direct deals and insertion orders.

Traditional IO V/s Programmatic IO

Well, traditional insertion orders are the workhorses of the advertising world, but have been considered as slow and cumbersome. With programmatic IOs you can streamline the process with automation. Programmatic IOs are a game-changer. They are fast, smart, and easy to scale.

The difference between these two approaches is stark:

The Bottom Line

Programmatic deals are all about efficiency, precision, and maximizing your ad inventory's potential. It's time to trade in the paper chase for a data-driven powerhouse! Nonetheless, it is crucial to consider that traditional insertion orders still provide a clear framework for direct deals, especially for premium inventory or long-term partnerships. 

So, ultimately, it is up to you to decide whether to work on an insertion order or skip them by partnering with an SSP. You still have to sign an insertion order* with the SSP (for distinguishing, we call this a programmatic IO). But most top SSPs will have a feature to generate IOs digitally (we have one). So you don’t need to go through much paperwork at all. 

*The IO signed with a programmatic vendor will differ from the traditional insertion orders. This isn’t a deal between a particular advertiser and a publisher. It’s a long-term partnership between a vendor and a publisher. 

FAQs

1. What is an insertion order?

An insertion order is the signed agreement between a publisher and an advertiser that specifies the parameters of the ad campaign both parties are working on. Once signed, the binding document holds both parties responsible for delivering their end of the deal.

2. Why are Insertion Orders important?

Insertion orders provide clarity and structure to advertising campaigns. They ensure both parties are aligned on expectations, prevent misunderstandings, and establish a legal framework for the campaign.

3. What are the key components of an Insertion Order?

A typical insertion order includes:

1. Campaign details (name, start/end dates, objectives)
2. Ad specifications (formats, sizes, placements)
3. Target audience
4. Pricing and payment terms
5. Performance metrics and reporting requirements‍

4. What does an insertion order template look like?

Most IO contracts contain basic terms, like start and end date, ad unit dimensions, impressions, pricing, and total cost. While each insertion order is unique, you can find an industry-standard template here to serve as a basic outline.