Why Online Ad Industry Can't Reform Itself

Online advertising has a very simple problem with a very simple solution. But it's a solution that will never happen.

Like all advertising, digital advertising is annoying. No sane person voluntarily signs up for any kind of advertising, but we tolerate it in other media. TV ads and radio ads and newspaper ads may be a bother, but they're a minor bother.

Online advertising has gone way beyond that and become a plague. It hounds us, tracks us, interrupts us, slows us down, costs us money and is more than just a nuisance, it's a scourge.

The result is that there is a rebellion going on among consumers. Two hundred million of us have downloaded ad blockers. This is causing a big problem in digi-world.

The solution is simple. The online ad industry should do what all other media do and show some mature restraint. They should voluntarily end tracking, they should limit the "load factor" of their ads so they don't cost us money, they should ban auto-starts, page takeovers, pop-ups and other forms of ultra-intrusive ads.

The result would be beneficial to all. Consumers would be much more tolerant of online advertising, and online publishers could sell their ad space at a better price by not having to compete with the sleaze merchants at the bottom of the internet cesspool.

But this will never happen. The reason it won't happen can be found in a logic principle called the "fallacy of composition." The fallacy of composition says that something that is good for the whole is not necessarily good for the individuals that comprise the whole.

For example, it may be a very good thing for the online ad industry to stop tracking, but it would be a disaster for Facebook. Facebook sells its ad space to advertisers based on its ability to know who you are and what you want. How do they know that? They track the shit out of you.

Consequently, the idea that a web publisher will voluntarily give up his "value proposition" for the good of the industry is a fantasy. It will never happen unless and until some organization or agency imposes standards on the industry.

The online ad industry has a lot of problems. They say they can't do much about online fraud. Maybe that's true. They say they can't do much about unscrupulous publishers. Maybe that's true.

But they can do something about "worst practices" and they are not. Leaving it up to individual publishers, or individual agencies, or individual clients is not working and never will. The fallacy of composition will see to that.

Online publishers, greedy agencies, and clueless marketers are creating a nightmare for themselves. When it all blows up in their faces they'll have no one to blame but themselves.

Annals Of Literary Criticism

 

Dear Geraldine:

So nice to hear you're not a prude. I understand. You're just someone who doesn't like references to sex or sexual activity or adult language. That's not being a prude! That's just being a...something else... like a chipmunk or something.

You are so right about there being no place for the "f-word" in marketing. Marketing is a virtuous and much admired profession. We should never permit the unsavory habits of art and literature to sully our blessed calling.

You know, I've tried reading some of the so-called "works" of Ernest Hemingway and James Joyce and D. H. Lawrence and Allen Ginsberg, and Norman Mailer and Erica Jong and Nora Ephron and Philip Roth and John Updike. What a REAL turnoff.

Why do they have to use that word that I'm not even going to describe as the letter "f" and then the "-word" thing because all that does is make me think of the actual word which makes me REAL REAL sick and all I can picture are disgusting, sweaty body parts all wet and slippery jiggling around. And then I have to take a sponge bath or drink some tea (herbal) or something.

I mean, what's wrong with "doggone it" or "jeepers?" I'd like to know that from some of these so-called "hep cats."

Can I ask a favor? Next time you write a review of a book of mine, please don't say "f -word"  because I find it a REAL REAL REAL turnoff. Maybe you can call it "the word that makes everyone throw up who is NOT a prude" or something.

Next I want to thank you for taking the trouble to read 2 pages of my book before you wrote your review. Believe it or not, some people will write a review after reading only 1 1/2 pages. Lazy b-words.

Knowing that there are awesome people like you out there who are NOT prudes and have the integrity to finish 2 pages before posting a review makes writing so much more gratifying.

Your friend (or should I say f-word?)

Bob

Waste Not, Grow Not

There's a restaurant in my neighborhood that's very popular.

You can go there any evening about 7 pm and I can predict with absolute certainty that every table will be occupied and there will be 80 people there. But I can never predict which 80 people it will be.

It's the same with toasters. I can tell you with absolutely certainty that tomorrow there will be 1,500 toasters sold in the United States. But I have no idea who will buy them.

Also tomorrow there will be about 500,000 t-shirts sold (I'm making these numbers up.) But who's going to buy them? No idea.

Marketers used to deal with these uncertainties in a reasonable but wasteful way. We would use experience and knowledge of the market to anticipate the type of person who would be most likely to eat at a restaurant, purchase a toaster, or buy a t-shirt. Then we would direct advertising at these types of people.

Because we used mass media, this media strategy had the disadvantage of being wasteful. Most people we reached would not be in the market for, say, a toaster.

But it also had three advantages: First, we would reach just about everyone who we thought would be looking for a toaster. Second, we reached an awful lot of people who we did not think were interested in a toaster, but were. And third, it reached just about everyone who would someday buy a toaster.

Advertising has changed. Now we believe we can predict exactly who will be buying a toaster tomorrow. We believe we can identify not just the most likely group of people, but the actual individuals.

All we have to do is follow them around the web and find out where they've been, collect the  data and soon we'll know when they're ready for a toaster.

The idea is to make individual targeting so precise that it replaces demographic likelihoods as the basis for media strategy.

So far this has been a spectacular failure. Each of us is currently inundated with dozens, if not hundreds, of online messages a day -- banner ads, emails, social messages, etc -- that are assumed by  marketers to be particularly relevant to us and reflective of our individual purchasing needs and behaviors. We pay almost no attention to any of them. They are essentially invisible.

The math tells the story. A generous number for display advertising is that it generates 8 clicks in 10,000 exposures. A generous number for Twitter interactions is 4 engagements in 10,000. It's hard to get much closer to zero.

We are thinking like direct marketers, not brand marketers. We are ineffectually using "precision targeting" to try to engage the perfect individual, and by eschewing mass media we are harming our brand in three ways.

1. We are not reaching those within our target segment who are not active on line or whose data we haven't mined.

2. We are not reaching the unexpected toaster buyers, of whom there are legions. 

3. We are not building a brand. Mass media advertising may be "wasteful" by the nearsighted standards of digital and direct marketers. However, some very wise people have pointed out that the nature of what we call "waste" may, in fact, be the very stuff that brands are built on.

Think about it this way. In 2002, Apple spent tens of millions of dollars in mass media to advertise the iPod. There were hundreds of millions of people who were exposed to iPod advertising who had absolutely no interest in an iPod. After 14 months, advertising had reached hundreds of millions of people, but Apple had sold 600,000 iPods.

Many marketers would call the enormous amount of money that Apple spent promoting the iPod to the uninterested "waste." But was it?

Today hundreds of millions of people who had no interest in an iPod own iPhones. Isn't it more than likely that the iPod advertising of 2002 had significant impact on the iPhone buyers of 2007 and beyond?

• Didn't it make the Apple brand more appealing?

• Didn't it raise interest in mobile devices, particularly Apple mobile devices?

• Didn't it set the stage for the phenomenal success of Apple in the mobile device category, that made Apple the most successful company on Earth?

Or think about it this way. Why have almost all the brands in your supermarket been built with "wasteful" mass media advertising and none with the "precision targeting" of online advertising?

Understanding business is understanding that markets don't move in straight lines, people don't think in straight lines, advertising doesn't work in straight lines.

If you're a brand marketer and you want to grow, you have two choices. Be wasteful or be invisible.

Toyota Says Scionara

"As the Detroit Auto Show kicks off this week, Cadillac will introduce its first compact luxury coupe, the 2015 ATS Coupe, designed to appeal to younger consumers..."  Fast Company

“Advertising on the Super Bowl broadcast with talent like Beckham (23) and Ratajkowski (24) fits nicely into Buick's mission of remaking its image to appeal to a younger audience..." Edmunds.com

Here at The Ad Contrarian Global Headquarters, we've been marveling for years at the stupidity of marketers' obsession with young people.

Not that there's anything wrong with young people. It's just that they have no money, they can't afford to buy very much, and when they grow up and have money, they behave just like every other generation that was supposed to be completely different.

Meanwhile, people over 50 have and spend most of the globe's money. Or as PJ O'Rourke put it, "whenever anything happens anywhere, somebody over 50 signs the bill for it.”

The worst offenders are the automotive industry. Every time a car company releases a new vehicle the rationale is always the same: We're trying to attract a younger audience.

It's hard to find an auto ad without a young person in it. Meanwhile people 75-to-dead buy 6 times as many new cars as people 18-to-24.

How about a car company trying to attract an older audience? Ya know, like the people who buy 60% of cars.

A couple of years ago The Wall Street Journal reported on this phenomenon. They wrote about "youth cars" i.e., cars targeted at 18-34 year olds. An astounding 88% of these "youth cars" were bought by people over 35.

Apparently one car company has finally come to its senses. Toyota announced last week that it is burying its awesomely young and hip Scion brand -- its much ballyhooed entry into the "youth car" category.

According to Toyota, 50% of Scions have been sold to people under 35. According to Industry Week...

"Scion has consistently been the youngest brand in the auto industry with an average age of 36 years old.."

Scion was the unchallenged king of all youth brands in the auto industry. What does being popular with young people get you these days? 1/3 of 1% share of market.

According to official Toyota propaganda regarding the whacking of the Scion brand...

"They (young people) like their parents, have come to appreciate the Toyota brand and its ... quality, dependability and reliability. At the same time, new Toyota vehicles have evolved to feature the dynamic styling and handling young people desire.”

When you get past the self-serving corporate bullshit, what that means is this: As they're growing up, young people are, ahem, behaving just like every other generation that was supposed to be completely different.

Youth cars? Scionara.

The First Sexless Super Bowl

Well, the annual Festival of Excess is over and here are some thoughts. 

Where Was The Sex?
This may have been the first sexless Super Bowl. We are usually treated to an abundance of middle school-style leering and double entendres in Super Bowl ads. Not this year. Has the politics of sex become so oppressive that even advertisers are afraid to be juvenile? 

That's Entertainment
Every creative director and cmo with a functioning brain knows one thing about Super Bowl advertising -- success has nothing to do with effectiveness.

Your success or failure will be judged on how well people liked your spot and nothing else.

The reason is simple -- unless you're a direct marketer (which no Super Bowl advertiser is) it's pretty much impossible to calculate the effectiveness of one spot at one time.

So popularity always stands as a proxy for effectiveness.

People liked your spot? You win.

People didn't like your spot? You lose.

End of story.

The Phrase That Pays
If there's one line of copy from this year's crop that could be remembered, it might be this one from the "Walken Closet."

"Punch it, Richard."

Critiquing The Critics
I followed the tweets of the advertising "experts" from Ad Age and Adweek during the game. In large part they were embarrassingly misguided. Makes you wonder if any of them ever worked in advertising.
 
What Happened To Social Media?
It seemed to me that in the weeks before the game there was a lot less social media chatter about Super Bowl advertising than in previous years.

Also there were a large  number of major brands that did not release their Super Bowl spots the week or month before the game.

Could it be that advertisers are finally waking up?

One of the critical aspects of effective advertising is impact. There is no better place to register advertising impact than on the Super Bowl. There is no better way to waste the impact of a Super Bowl spot than to have everyone see it for weeks before the game.

"Oh, yeah, I saw that one," is not the reaction you're paying $5 million for.

The Big and Dumb Award
This award is presented every year to the company that spends the most money and makes the most hysterical and pointless commercial. This year it's a tie between Coke "Hulk/Ant-Man" and Prius "Bank Robbers."

The Award of Desperation
This year it goes to CBS for their relentless and embarrassing promo-ing of Stephen Colbert.

Every Ad Related To Technology Or Online Commerce...
sucked. 

The Spot That Actually Made Me Want Something:
I really wanted that hamburger in Helen Mirren's Budweiser ad.

Native Advertising - Just More Online Corruption

The online advertising industry is a corrupt shit show unprecedented in advertising history.

Just to recap some of the sleaze it has engendered and some of the ways it has undermined corporate and media decency:

• Despite industry lip service about cutting down on online ad fraud, Business Insider reported a few weeks ago that it will grow to over 7 billion dollars this year.

• Billions of fraudulent impressions are paid for by advertisers every day.

• Untold numbers of phony clicks are monetized and charged to advertisers.

• "Unviewable" ads are paid for by advertisers but are invisible to live human beings.

• Phony websites are selling ad space to clueless advertisers through impenetrable ad networks.

• Consumers are unwittingly funding the distribution of ads to websites.

• Online content is being debased into a relentless click-bait festival.

• The web has become an exasperating non-stop marketing machine.

Now online advertisers are mainstreaming what used to be a sleazy practice. There have always been media operators who would offer advertisers editorial or on-air mentions in exchange for a media buy. Or they would sell "advertorials" -- ads disguised as editorial.

They've dressed it up with a lovely name -- native advertising -- but it's nothing new.

What's new is that it is now widely accepted by "quality" media. All the predictions are that native advertising will grow substantially in 2016. The mainstreaming of this wretched practice has been propelled by the growing consumer ad blocking revolt.

The acceptance of native advertising by once-decent media like The New York Times should be alarming, but apparently isn't to any but a few of us. I guess when you’re going broke, any source of income is acceptable, regardless of how it undermines your principles.

This is a very disturbing development for citizens. The co-mingling of political agendas and news has infected our broadcast outlets (Fox, MSNBC) and in 2016 the conflation of advertising and editorial is expected to take a quantum leap forward.

A few weeks ago, the FTC issued guidelines about native advertising.  I expect these will be largely ignored. The IAB (Interactive Advertising Bureau, or as I like to call them, Inactive Advertising Bureau) is already whining about the guidelines. According to Ad Age...

"The IAB singled out for criticism... a section that calls for advertisers to use "plain language" in labeling an ad as such."

Yeah, imagine calling something what it really is? That would be complete anathema to the charming culture and history of online advertising.

When I checked my Facebook page today, despite the FTC's guidelines, Facebook is still using bullshit like "Suggested Post" to disguise ads.

Online advertising seems to corrupt everything it touches.

Advertising's Comedy Bitchfight

Here at The Ad Contrarian Worldwide Headquarters, there's nothing we like better than some good old-fashioned internecine warfare.

So we're getting out the Ketel One and the popcorn and settling into our leatherette Barcalounger to watch the Super Bowl of Advertising Schoolyard Punch-Ups over the next few months.

It's the 4As versus the ANA -- and it's a beauty.

In case you haven't been following this ongoing sitcom, here's our story so far:

Last summer, some nitwits from the ANA (Association of National Advertisers) woke up one morning and realized that they were being fucked blind by their media agencies.

If they had been reading a certain blog they would have known this years earlier. But, hey, I'm just a Luddite dinosaur.

So they teamed up with the 4As, (the agency trade association) and decided to create a "Joint Task Force" to develop guidelines for media buying "transparency."

A "Joint Task Force," by the way, is the non-governmental equivalent of a "Blue Ribbon Panel." In other words, a bunch of overfed blowhards who get together at golf resorts to sip white wine and nap.

Well, to no one's surprise, the marketers' definition of "transparency" was somewhat different from the agencys'. The marketers' definition was "open up that kimono" and the agencys' definition was "fuck you."

So, sadly, the Joint Task Force turned out to be one Joint short of a ska band. The whole thing went up in, um, smoke.

Next thing you know, the ANA announces they're hiring not one, but two organizations to investigate the buying practices of the agencies. And one of the organizations employs former FBI agents.

As you might well imagine, this lead to severely diminished bowel control among several agency fat cats.

Now we cut to last week. Without consulting the ANA, the 4As issues something called the "Transparency Guiding Principles of Conduct" which sounds like a chapter out of the Girl Scout handbook, but apparently gives solemn tribute to the concept of transparency while defining it as "whatever an agency can sneak past your lawyers."

To which the ANA responded thusly: In quintessential Gestapo fashion they announced the opening of a snitch "hotline" in which any sniveling malcontent with a gripe against an agency can call in with anonymous accusations.

Isn't this lovely? It makes a guy proud to be an ad blogger.

The best part is, this whole thing promises months of rib-tickling fun to come.

Just one bit of unsolicited advice for the 4As: When's the last time an agency got into a fight with a client and won?

Right, never.