I am breaking my holiday silence as a few readers have reminded me that I forgot to post a link to a column I wrote up for Technology Review magazine. It’s basically a rewrite of my Sell Side Advertising post, but to make the concept a bit more approachable (or perhaps to ruin it) I changed the name to Publisher Driven Advertising. In any case, as always I owe a debt to Ross Mayfield and many others for the ideas contained within. And it’s my hope that in 2005 we can take this idea and see where it might run.
Tech Review: New Form of Advertising
I am breaking my holiday silence as a few readers have reminded me that I forgot to post a link to a column I wrote up for Technology Review magazine. It's basically a rewrite of my Sell Side Advertising post, but to make the concept a bit more approachable…
I think Google’s ad program is exactly what you are talking about in the article. The “affiliates program” that a lot of companies are offering goes one step further. The advertisers only pay when the reader actually BUYS something, not just “click through” to the advertiser’s site.
The “affiliate” gets a larger percentage…sometimes as high as 5% of the sale. Of course, this won’t work for companies that don’t sell anything directly to the end user. In that case, the Google ad model will work just fine. Rainy Day Magazine has both models of advertising on the site.
Our readers definitely appreciates the “focused” advertising!
Some comments.
1) Bloggers don’t have time to pick ads. It’s ridiculous to think of a blogger wading through Ads looking for the ones to show. But what I do want is to be a bit more involved in the placement process. I should be able to nudge along the Ad Agency saying I want “These types of ads related to these keywords but not those”. Perhaps a one click solution on the Ad saying “Love, Skip, Ban” that only the blog owner could see.
2) “Internet-based ad is already a little piece of software”. Really? it just looks like html to me… I think what you mean is that Ad systems should have an API so you can query details about a particular Ad. Good idea.
3) AdSense sucks for bloggers. I’m tired of my blog getting nothing but adverts for blog systems. Just because the reader is looking at a blog doesn’t mean they want one too. Especially as they’ve almost certainly already got a blog of their own. And Google doesn’t index the blog post fast enough and so know what Ad to show. A lot of blog reading is done within minutes of the post via RSS. Getting the right Ad a day later is too late.
4) See 2) I want to see Ad Systems (like AdSense) have an API so that Listing systems (like Craigslist) can automatically post Listings (for a premium price) as Ads. Let’s have a decentralised eBay based on Ads that appear on Blogs. I think this is a big idea. The problem is that it drags Google further down the long tail and they may not be ready to do it. And if not them, then who?
Is there a space for the CUSTOMER influence,
in this triad: advertiser, publisher and viewer/customer?
At the end of the day, money comes from the customers, it is re-directed by advertisers.
So why should I pay to be bombarded by stupid
food adds, when I am i.e. looking to by a car?
Internet has a unique advantage of being
bi-directional media, so why not give some
control to me, the user? I can select
what kind of advertising I want to see,
and I can even make some profit in “spreading the word.”
There is so much more potential in the internet communication…
Dragan:
I agree. Consumer-driven advertising is the real endgame.
My post on it here.
Keep in mind, though, that advertising is fundamentally about selling, and it’s the job of the advertising to maximize someone else’s financial gain, not your own experience, health or well-being as the target. And human beings have proven quite susceptible to well-packaged messages. I don’t expect advertising to ever become a collaborative hug-fest… it’s someone putting bread on his own table by persuading you to buy something (and whether you actually need it is less than central to the calculus).
http://www.imdb.com/title/tt0104348/quotes
I love this kind of thinking, but I am not sure it would apply to everyone. As a small business myself, I fear that if I put my advert up to be picked, no publisher would choose it. True, it would be cheaper for a publisher to have an Aqute advert than a Forrester advert, but they don’t know what Aqute is, don’t know if we have a good reputation. If publishers feel that users will think they are “endorsing” the ads on their site, they will choose the bigger and more trusted brands. So the small advertiser loses out.
The alternative, that the publisher will choose advertisers that he knows and trusts but who are not large companies, sounds too much like a clique to me. I understand the point about communities of influence, but if the publisher is only going to promote his friends and allies, who he probably already links to anyway if he is a blogger, what chance for the new kid on the block?
The internet, especially things like blogs and paid text ads, is supposed to be a democratic leveller, allowing the small guy a better chance of surviving than in the big “offline” world of capitalism. With Sell Side Advertising, what might end up happening is the creation of new super communities who serve themselves, and advertise themselves to their large audiences, and the smaller advertisers being left out in the cold. True, you could argue that the A-list blogger has earned that audience, but one could say the same of the customer base of Coca Cola or Microsoft; and it is not necessarily true.
Sell Side Advertising needs refining so that it does not create self-serving cliques.
This article was one of the most rediculous ivory-tower dispatches I have read in a long time. I read it thinking that it must be some sort of modest proposal, but sadly it was not.
It is one of those ideas, like communism, which sounds very nice at first glance on paper, but does not work in reality, when taking into account human nature. To consider PDA, one must assume that all parties in the equation are inherently good, and take actions which are also honest and thoughtful. Unfortunately, when money is involved, honesty is often left aside.
The article describes something very similar to an affiliate program, which is something that e-commerce companies use to incent transactions on advertisers on their websites. Affiliate programs are known in the advertising and marketing communities as being rife with fraud. MediaPost
It also assumes that online advertising is always used for direct response, transaction-based purposes. In fact, many advertisements are for products or companies which have nothing to do with a transaction online (or even in stores). In this case, the internet is used as a cost-effective way to reach audiences who have the potential to be interested in the advertised product/service, to drive brand awareness, message association, and other kinds of qualitative metrics.
It’s clear that this article does not consider that advertisers do often care very deeply about the individuals who view their ads, and about messaging that is most relevant to those reached. Advertisers and publishers work together to ensure that the site and brand experiences are as positive and relevant as possible to the end potential consumers. This isn’t benevolence or altruism: if they didn’t do this, consumers would decide based on their readership habits and purchasing behavior.
Thanks John, appreciate the attribution.
PDA is much more approachable and doesn’t carry the baggage of financial markets.
I think this is a very fanciful notion of how advertising could/should/might work. Also, there’s a big picture that encompasses both text-keyword-targeted ads and general ad banners as well.
Big and small publishers alike don’t want to and cannot take the time to pick and choose among different advertisements. They’re lucky enough if they can sell their inventory and make any general kind of thumbs-up or thumbs-down on what types of ads they run… mostly just rules like “no gambling ads” or “no porn ads” for the big guys. In fact, the whole notion of an advertising network is so that the small publisher doesn’t have to mess around with individual advertiser relationships, but for many of these networks the publisher has little control on what ads are getting shown on their site, it is mostly a case of economics. The system’s functioning and scale is predicated upon optimizing on an effective CPM.
If you stop and look at whose ad dollars are getting the most play online, the proportion of ads for mortgage refinancing, DVD subscriptions or VoIP service far outweighs what should be a healthy mix based on what consumers would want (on average) but it is driven by the margins these companies can derive from these products. More thoughts about this at analystblog – but I applaud the ideas behind this, just think it will take some time to shift the current (inefficient) balance.
I would have thought that what you’re describing in the column is pretty similar to Affiliate advertising where the publisher searches an archive of ads and choses which to place on their site. Only difference being that they usually get paid for a solid lead or sale rather than a click.
I’m all for this type of system becoming more automated though because as a blogger (even a full time one) I don’t have time to spend too much time searching for relevant ads for my blog.
John, you would know from your Industry Standard/IDG days that the last thing a publisher wants is to increase the cost of sales by picking from a “vast supply of advertisers.”
I like the thinking behind your model, but still have a problem with the notion that the only way to build value is pursuing low-cost, commodity-style advertising. Is that the only model available for blogs? I’m both a blogger and exec at IDG Australia, and I’ll take a high-margin model over a low-margin model any day. I’m sure many other bloggers would too.
Hey Mark. I’m not saying that this would be lowest common denominator, far from it. The best ads win, the best performing ads on *your* site win. As to cost of sales, I’d argue this in fact would lower it – the “sales” job migrates to a “search” job of sorts – finding the best ads for your site.
I
Love is two people sipping Coca Cola from the same straw on a warm sunny day.
Ive only managed to flash read the posts, but I think this might be in the region I hope.
I’m sure it will not be long before a 3rd party web services ad component, will be available for a plug-in into the majority of publishing systems.
Hello, ick comes from Austria, today has I again time around English sprachige Blogs to read. I will form over your topic an opinion and you by post office will write.
I wish you kind regards from Austria in the Wachau
Manuel
I think Google’s ad program is exactly what you are talking about in the article. The “affiliates program” that a lot of companies are offering goes one step further. The advertisers only pay when the reader actually BUYS something, not just “click through” to the advertiser’s site.
The “affiliate” gets a larger percentage…sometimes as high as 5% of the sale. Of course, this won’t work for companies that don’t sell anything directly to the end user. In that case, the Google ad model will work just fine. Rainy Day Magazine has both models of advertising on the site.
Our readers definitely appreciates the “focused” advertising!
I don’t expect advertising to ever become a collaborative hug-fest
I agree. Consumer-driven advertising is the notorious