The ad industry is in trouble. Budgets are down, budgets are shifting, CTRs tank, users revolt, what worked before doesn’t work anymore, so we’re moving online, mobile, social, yet we don’t know why and how, and the cyclical symptoms are only accelerating the systemic issues we’re dealing with. How can advertising stay a meaningful and relevant industry in this social world we’re living in?
David Koretz asked the very question in his recent post to the topic named so appropriately “Do we matter?”. His key points are to make it all about the user:
- Let the user own their data.
- Remember the user experience.
- Continue to optimize.
Yes, it’s all about the user. In fact, I’d bring it one step further which is realizing that we live in a social world now!
I strongly believe that most users (particularly those consuming free content) would actually appreciate ads, if they were just relevant to them. But because they are not, they become clutter. And clutter is annoying. The answer is not to put more ads up, which is just multiplying the clutter, it is about the right ad for me, the user, when i want it.
Imagine publishers actually knew the type of products I was interested in and then could sell against that interest, instead of making me “a demographic” they decide should fit a certain set of advertised products. Why don’t they just ask?
Imagine they let me vote on ads (cudos to Facebook) and they would actually change the ads based on my feedback (sorry, not quite there, Facebook).
Imagine the publication put me so much in control of my ad experience that eventually it would turn into a point of search when i look for certain products?
Advertising’s inherit problem is that marketers don’t know where to draw the line between brand building (= reach) and targeting (= action), hence the whole obsession with CTRs. In our social world my bet is that we need to apply relevance to both, because the user is taking control, and that’s a good thing. We need to look at users as individuals and not in aggregate, and cater to each individual’s needs accordingly.
It means lots of changes in the industry, from data collection and management, to how we sell ads (and networks could have a whole new meaning), to technology that lets the user manage their data, and optimization that is user-based.
Lots of work, for sure, but making a meaningful industry going forward.
Hulu has this interesting approach. Before you start watching a show, you have this screen that ask you to select “Which experience you prefer” and they give you 3 options of companies for you to choose which one to have ads from.
Even if 3 is not an amazing selection, more than that could be confusing and also, the fact that they offer you 3 options, all with a logo, a cute picture and in a very prominent way, forces you to actually think about those 3 brands, because you need to chose between them.
I also think it is important to re-educate the consumer and make them realize that nothing is really free, and those ads that they complain about, are what allows whatever they are consuming to be free. I think once the people really understand they trade off or once they are offered the choice of paying or having ads, most people would chose the ads and learn to appreciate them.
Hulu is an excellent example, Guady, for a new site that does things in a new way – and their success speaks for them. And you are absolutely right, there is a lot of value in the user evaluating and ranking brand choices, obviously for the user, but also for the marketer, in that they can better understand how they rank against other brands. Thanks for your comment.
In financial services, but we suspect in most industries, the credibility of all promotional activities has dropped to minimal. Trust is gone. It’s best to not be moralistic, but radical transparency has exposed many efforts as misleading, short-term and exclusively sales focused vs. customer benefit.
Also it’s very difficult (impossible?) for those producing (selling) to keep up with consumers (paying). Attention spans, trends, fads, velocity of commerce is all accelerating.
There is also decent empirical evidence that efforts to increase market share/customer satisfaction do not produce financial results. A firm is either in a “hot”/growth market or not. Pretty simple.
The reference on this is The Granularity of Growth: http://www.amazon.com/Granularity-Growth-Identify-Enduring-Performance/dp/0470270209/ref=sr_1_1?ie=UTF8&s=books&qid=1251147503&sr=8-1
Cheers
Hi Elmer – I completely agree that trust is missing between the consumer and the advertiser, and campaigns have hence become less credible and less effective. Trust is also the key ingredient when it comes to the social web, therefore advertisers have a great opportunity to re-build and foster trust if they apply social media marketing sensibly. I can almost not believe that customer satisfaction should not translate into profitability, though the added investment can easily outweigh the financial benefits, at least in the beginning. But down the line, again in a social world, wouldn’t a satisfied customer become increasingly valuable to the business and contribute even more to the bottom line?