Especially in this economy, it’s clear that there are pressures on everyone in the advertising ecosystem to do more with less. This leads to advertisers (or their downstream reps, ad buying agencies) trying to figure how to allocate resources in the most effective way possible. But some of the thinking I’m seeing seems a bit rushed. In particular, many decisions are being framed as “either/or” when they can be looked at more effectively as optimizations (“and/”how much”).
Ad Networks vs. Publishers
Ad networks are the big online financial success story in the new century, especially if you count Google’s AdSense in that mix. Ad agencies that were initially skeptical are now seeing the benefits of scale and ease of going to a smaller number of vendors to deal with their advertising needs. The ad networks will argue that you can get to many of the publishers without a direct relationship. So, what’s not to like?
Publishers will argue on the other side that the branding advantages, customer care and integration into their sites more than makes up for what ad networks can provide. But this is a classic example of a false dichotomy. Sure, if you can reach a lot of people via an ad network inexpensively, that should probably be part of your mix. But the publishers have a point in being able to provide an experience that can be managed more effectively on their site, as well as being integrated into the brand experience of a publisher’s offering.
Here at Topix, for example, we run both direct sales as well as inventory through networks. We can offer things to the advertisers who are coming to us directly that there’s no way we can duplicate for folks coming in through the networks. We found in one advertiser’s case that in one part of the site an interstitial was getting massively high click through and conversion, while in others, it didn’t perform well at all. We were able to make changes that helped that advertiser see a difference in ways that eventually impacted their entire buy, which they would not have gotten had they not worked with us directly. For them to fill out their buy with large scale network buys on other sites made sense, but we provided enough value for that advertiser to stay with us for a multi-month campaign.
Reaching a Demographic vs. Contextually Relevant Content
If you’re Ford, it’s pretty obvious that you want to buy advertising in an automotive magazine, but to reach the broader audience of people who might be considering the purchase of a car, traditionally you need to make a broader media purchase. Often, this involves some decisions on which demographics are likely to be most influenced by your media purchase, and then invest your media dollars accordingly, say on “American Idol”.
But these demographic decisions inherently involve optimizing with incomplete information or focusing on one part of your audience at the expense of another (check out Burger King and the recent criticism at trying to hit the young male consumer at the expense of women, for example).
To get to scale as a purchaser of advertising, it’s totally reasonable to make decisions and choices around demographic targeting. However, as in the above case, why would you not pick the comparatively low hanging fruit of contextually relevant content to backstop this decision? For instance, the newspaper industry has figured out that contextually relevant local context performed 3X as well for advertisers than pure demographic targeting. In other words, the ads for a local business worked better in a local paper’s web site surrounded by local news stories, than geo-targeting via an IP address. 3X is enough to want to make sure that you consider how easy it is to get the contextually relevant media along with those that target along demographic lines.
Coming in with a local bias, it has never made sense to me why every company with local brick and mortar establishments doesn’t put a larger focus on the contextually relevant, local opportunities in the media mix.
On the extreme side of this are companies like Associated Content and Demand Media who are in the business of creating on demand content for the express purpose of being a vehicle for directed advertising. Having trouble with aggregating an audience for your artisanal cheese products? Why not create the content online to help your audience make this work. My favorite example of this is Warrantyweek, which is published by a warranty management software company. They couldn’t find a good place to reach their audience as a group, and so they created their own content.
Print vs. Online media
Here’s a case of how industry structures – in this case, how ad agencies work, and how media is deployed – put problems in the way of logical decision making. While the media mix of what works is going to vary, there seems to have been a lot of focus on how the decision to enter into online advertising is going to kill print media, and the narrative that print is on a fast path for extinction. I’m an online publication, and I’d still give my eyeteeth for the benefits of having a print adjunct to my business – it just provides a better revenue stream to have both (albeit one whose costs are potentially a worry). While print is certainly on a usage decline, alternative weeklies like the Village Voice, are doing well in both print and online. Albritton and The Politico are a great case in point. They can offer advertisers both print and online advertising, and evidently, this combination works well for their advertisers.
Customers who are deploying Sunday circulars in the print newspapers for their retail stores see utility form that purchase. Taking the same information and putting it online would make a huge amount of sense, and future-proof their advertising efforts against the declines in print.
User Generated Content vs. Professional content
I love getting the Sunday New York Times, and I read several newspapers and websites regularly as part of my job. But online, I’m finding that much of the really interesting stuff is happening in the commentary of the sites I read. And, the ability to have relatively unfettered participation is a huge part of which places I devote time and energy. Many people online are finding the same thing, which is why it is such a silly issue to debate user generated vs. professionally created content.
Journalists love to hold up user generated content as a shibboleth and threaten the destruction of the Republican at the hands of Wikipedia and its ilk, but as Steven Berlin Johnson pointed out at last year’s SXSW, the future is already here in the tech press, and journalism at places like TechCruch and Venturebeat is thriving by embracing the stream of comments and twitter feeds.
For advertisers, taking simple steps to make sure their content does not appear as an endorsement of something unfiltered is a key to making this work, but there are major advantages in hitting people at a point of engagement, instead of merely at a point of interest, which should be considered. As the world comes online and spends as much of its media time creating, the world of advertising will need to work this better into the mix. But that doesn’t mean that there is any call to abandon professionally created content as an advertising vehicle.
Search vs. Display advertising
Everyone seems to understand that there are multiple parts to the purchase process, and yet there seems to be a disconnect around search vs. display advertising. Obviously, if you can reach the buyer right before they make a decision and steer them into an online purchase, that’s not only great, it is also measurable, trackable and why Google is worth $380B. But that is not the whole story. My brand decisions are formed way, way earlier than my searches, as a result of the media choices I make and the advertising to which I’m exposed therein.
Also, how many people search for making offline purchases such as consumer packaged goods? Or search for where they are going for lunch for that matter. Display ads are a powerful part of that mix, and the idea that buying one obviates the other makes no sense.
In Summary
Pundits and prognosticators have to make a living too, and posit great changes and paradigm shifts. There has indeed been an online revolution, and things are different. But too often, in the interest of making a point, those people essentially are deliberately creating a series of harmful false choices. At least in the above cases, optimizing these choices means embracing the “and” instead of being content with the “or.”