• by Josh Chasin , Op-Ed Contributor, January 26, 2011

Back in the mid-'80s, when the first great wave of agency consolidations swept up names like BBD&O, Doyle, Dane Bernbach, Young & Rubicam and J Walter Thompson and massed them into entities with names like WPP, Omnicom and Megacorp (OK, I made that last one up), the obvious question before the court was, "What's in this for the client?" The big watchword at the time was "clout," as in "media buying clout." These newly giant agencies could, presumably, buy media for you more cheaply than before, and this was good.

Clout is really just a flavor of "efficiency," which is to say, price efficiency.

Of course, I don't mean to dispute the notion that vigilance in price negotiation is an important part of the job of media buying; it is, in fact, a really important part.

But back in the '80s, I wasn't so sure that media buying clout should be the primary defining characteristic of ad agencies, the attribute upon which they competed and defined their value proposition. I thought then, and think now, that at its core, advertising should be about brand building. And interestingly, while the big shops were consolidating and leveraging clout, buying media more efficiently than ever before, shops like Chiat Day, Weiden & Kennedy, and Hill Holliday were establishing and enhancing their reputations by doing great work.

In advertising -- and, I suspect if we thought about it, in all sorts of avenues -- efficiency is the enemy of greatness.

You've all seen the ecosystem chart. Which is a nice way to visually depict the extent of the energy, investment, and momentum in the digital space right now for the DSP/exchange/RTB model, wherein buyers bid on inventory based on some set of data associated with the specific impression opportunity (typically based on data stored in cookies on user machines, about which I wrote here). I usually shorthand this model as "cookie targeting."

Thanks to cookie targeting, the Internet is poised to deliver on its early promise of being the most efficient medium ever!

Why aren't I more excited?

What I've heard from the purveyors and proponents of this ad marketplace model is that there is no reason advertising shouldn't be bought and sold in the same fashion as financial instruments. But I think there is. Any two shares of the same class of common stock in a company have the same value, regardless of "context"; one truly is as good as another. When you're talking about money, price is absolutely the only relevant parameter.

But advertising has many parameters. Messaging. Execution. Engagement. Amplification and content synergy (does the content in which the ad is placed affect the value of the ad?) On this last point, Turner TV and Innerscope did some interesting work last year demonstrating that by matching the nature of the ad creative with the nature of the program content (an effect called "priming"), the media vehicle can materially increase the effectiveness of the ad (they won best paper at ESOMAR. comScore's ARS unit has done work in a similar vein; we call it Advertising Amplification, and it measures the effect that program content has on the effectiveness of the ad.

The RTB model makes it virtually impossible for the media vehicle to be a partner to the advertiser and agency in developing strategies and campaigns tailored specifically for the brand. In fact, RTB largely removes the media vehicle from the equation. And that's not good; publishers are every bit as invested in making advertiser campaigns work as advertisers and agencies are, and the good ones bring a wealth of knowledge, experience, expertise, and creativity to the table.

There is absolutely a place for the RTB, exchange, cookie-targeting model in this business, and it obviously isn't going away. Inventory is a perishable commodity, and (like a hotel room on Priceline) better to sell one at a discount than to let it lapse unsold. And long-tail publishers can use the exchange model to sell inventory without the overhead of maintaining a sales force.

But let's not make RTB cookie targeting -- "efficiency"-- the defining value proposition for digital advertising. Let's make price efficiency one of a broad palate of attributes and benefits we offer to advertisers. If we turn Internet advertising into an efficiency mill, we will effectively have sucked out all the greatness. And that would be a shame.