Tag Archives: advertising

July 20, 2015 · 10:58 am

The Broken Business Model

I’ve written before about ad blocking and all of the business questions it raises.  Those questions are most directly asked about the business model in media, but they might also involve your business as well.  After all, when the basis of your revenue model involves getting consumers to do something which they really don’t want to do, maybe it’s time for some more thinking.

The media business has been built on a business model that involves a trade: the consumer gets content in return for giving up their attention.  In the digital world, they provide data along with that attention.  The flaw right out of the box with this is that publishers tell users that their content is free, or at least they do nothing to discourage that belief.  When a consumer adds ad blocking software to their browser, they do so to create a better browsing experience.  They probably don’t realize that they’re breaking the business model; they just want pages to load faster or not to be interrupted by pop-ups, screen takeovers, or any of the other ad formats that scream at them instead of talking with them.  Some publishers have tried either a subscription or “freemium” model which eliminates the ads, but consumers haven’t responded.  Instead, many sites are seeing up to 60% of the ads they serve being blocked.  This, clearly, is broken.

What to do?  I’d be lying if I said I knew.  I’d start by using something on my site that sniffs for ad blocking and maybe redirect anyone who uses it to a page where we explain why the ads are necessary.  At least it makes the value exchange explicit.  Will consumers care?  Will they make a small donation?  Will they buy a subscription?  Some will, and that’s a step in the right direction.  I don’t think the nuclear option of refusing to serve content to anyone using an ad blocker is smart.

Maybe hard code the ads (build them into the page instead of serving them via an external call).  They can’t block something that’s part of the page and appears to be content to a blocker.  Way more work on the administrative end, but effective.  I don’t know what to do about page load times, another key annoyance caused by ads.  When an ad-free page loads in under a second and the external ad and tracking calls add up to 10 seconds to the load time, there is a problem.

Any business model has to provide something of value to the customer.  In this case, the site’s customers are advertisers and the products are consumers.  Unfortunately, the consumers are not cooperating and the product is in trouble.  Any thoughts on how we fix this?

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June 29, 2015 · 11:54 am

The Rise Of The Machines

One of the things I do to amuse myself when the weekend weather isn’t cooperative is to play video games.  I’m almost done playing the Mass Effect trilogy, which I highly recommend.  The games’ story revolves around a galactic war between biotics (humans and other species) and synthetics – machines, basically.

I flashed back to the game as a dozen articles about programmatic media buying came through my news feeds.  I don’t think it’s a shock to any of you to read that media buying has been transitioning from the personal, relationship-based business in which I grew up to programmatic.  People don’t talk to one another in today’s media buying and selling business: machines do. The days (and nights) of long lunches, emailed proposals, phone calls on Friday afternoons to sell out the weekend, and the entire one-to-one negotiating process have become mostly a memory.

I get it.  Programmatic is far less labor-intensive and a lot more efficient than the way I learned to sell media.  Efficiency, however, isn’t the total story and as the machines take over quite a few other things get lost.  The biggest one in my mind is transparency.  In many cases, the current media buying platforms primarily provide breakdowns of networks, and total schedule dayparts, and only after the campaign is complete do you see what has transpired and individual spot affidavits are shared.  Clients (the people who pay the bills, after all) are spending big chunks of their budgets on a plethora of middlemen, each of whom extracts their little pound of flesh for touching the buy.  It’s common for a third or more of the buy’s budget going to pay for services rather than media.

The biggest issue I have, frankly, is the loss of context.  Buying has shifted to buying audience delivery from buying based on content.  The machines buy and sell cookies, basically.  Those cookies might enable the buyers and sellers to learn quite a bit of information who is on the other end but they don’t add context.  Does that matter?  Indeed it does.

“While it certainly offers the opportunity to reach audiences more efficiently, our research shows that advertisers can’t ignore the strength of the publisher’s brand as a fundamental part of the ad experience and overall effectiveness of the campaign.”  That’s a quote from chief marketing officer and chief client officer at Millward Brown Digital as he reported on a study they had done.

According to Millward, as the “Brand Score” went up, so did the fit of advertisements, the consumers’ enjoyment of the ads, the trust consumers placed in the ads and the usefulness of the ads. Millward based its ratings on behavioral and attitudinal data collected about the consumers that visited the 44 sites during February 2014.

It’s not just about getting the right message to the right people at the right time.  It also involves the right place (read site/program).  I think that takes a human touch.  While beer ads make sense to a young male, those ads on a page containing “beer” and “drinking” keywords might also be a report of a car wreck due to drunk driving.

The human touch in media buying alerted us to when an episode might have subject matter that’s wrong for our ad. Buying audiences without regard for the show they’re watching or site they’re reading is allowing the machines to win at the expense of our marketing.  As the guys who spent the weekend battling them, I say no.  You?

 

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May 5, 2015 · 11:26 am

Asking For Trouble

You might have read yesterday’s screed about how AT&T was selling “unlimited” data plans that really had limits and shaken your head. I mean, doing something as deceptive as that would never cross your mind, right? Well, let’s put that deception into another, more prevalent context and find out.

The Association of National Advertisers did a survey about native advertising. You know what that is – content created by or for a sponsor which looks very much like the environment in which it runs. Maybe it’s completely straightforward or maybe it contains subtile messaging about the sponsor’s product or service. As the ANA puts it:

Native advertising is an advertising method in which the advertiser attempts to gain attention by providing messaging in the context of the user’s experience. Native ad formats match both the form and function of the user experience in which they are placed. The advertiser’s intent is to make the paid advertising feel less intrusive and increase the likelihood users will engage with it.

Many marketers (58%) are already engaged in this and many more intend to do so in the next year. I’m not going to go off (again) on publishers who do their damnedest to blur the line between ad and editorial. Instead, let’s just look at what the ANA found:

  • Two-thirds of respondents agree that native advertising needs clear disclosure that it is indeed advertising. Only 13 percent feel that such disclosure is not needed.
  • Both the publisher and the advertiser have a responsibility to ensure disclosure.
  • Three-fourths of respondents feel that there is an ethical boundary for the advertising industry when it comes to native advertising.

That’s all well and good except that when it comes to how that disclosure is made, we might just have an issue (and what the hell are the 13% thinking?). A company called TripleLift surveyed 209 U.S. consumers for their thoughts on how native ads are presented. They were shown a native ad on a website and different respondents saw the ad with different labels.  Seventy-one percent said they noticed the content in the ad, but fully 62 percent didn’t realize they were looking at an ad.  When asked which labels were the most clear, “advertisement” and “sponsored by” were the best in terms of letting consumers know they were looking at an ad.  The problem is that readers do NOT like feeling as if they’ve been deceived, as a study by Contently found:

  • Two-thirds of readers have felt deceived upon realizing that an article or video was sponsored by a brand.
  • 54 percent of readers don’t trust sponsored content.
  • 59 percent of readers believe a news site loses credibility if it runs articles sponsored by a brand.

So let’s go back to the AT&T question.  Would you knowingly try to deceive a consumer?  Before you answer, are you running native ads that just might be doing exactly that?  Are we – marketers and publishers – just asking for trouble in our quest for better engagement?  Let me know your thoughts.

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