D.O.A.: Death of Advertising

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This is anti-auto-tune, death of the ringtone
This ain’t for iTunes, this ain’t for sing-alongs.
                  Jay-Z – “D.O.A.  (Death of Autotune)”

As I have followed the RTB and programmatic trade media, I find it generally consumed (when not discussing fund-raising) with discussion about the impact of the technical advances that enable RTB and programmatic buying.  I obsess over those advances and I applaud the revolution I believe these technologies are producing for the greater media and communication industry.  Before you continue reading, you should know that this isn’t another anthem about increasing or decreasing CPMs, transactional friction, latency, measurement or computing power -- but rather an attempt to frame what RTB could and should mean to marketers and brands. 

RTB means the death of advertising as we know it.  Perhaps more than any other advance in the history of media, RTB changes the essence of marketing communications as they have existed in the past. This is not because RTB reflects a shift in offline to online marketing spending, or the disruption of linear advertising -- but rather, because it reflects a brand’s potential to speak directly to consumers via mass media.   In this regard, RTB goes further than search in impact. Search was the advent of a new channel – or, as some argue, the redefinition of an existing demand-based media like directories -- but search is not a mass medium or broadcast channel despite Google’s success.  (Average time spent on Google per user in the US is 1:01 per month, according to the Guardian; consider that Americans average 33 hours of television consumption per week according to Nielsen). 

In the planning and buying of media, the most significant change wrought by RTB is the deconstruction of the CPM, or “cost per thousand” currency. Used by all mainstream media planners, buyers, and sellers, the CPM itself predestines that purchased media is in essence generally mass media.  There is nothing inherently wrong with mass media, but the nature of mass is about scale, quantity or reach.  Until the advent of RTB planners, buyers and sellers had generally focused on reach and frequency as key goals and measurements because these are what the mass media form permits and excels.  In the U.S., young planners and buyers are correctly schooled that there is no more effective reach vehicle than the Super Bowl. What this lesson misses: that reach in itself is not the most effective way to communicate a brand’s message to consumers. 

RTB empowers the tailoring of every aspect of a brand’s communication with a consumer, transforming mass media to direct communication between brand and consumer. The ability to buy individual advertising impressions, based on large quantities of data about that impression and inevitably about the consumer of that impression, enables the concept of “customization at scale.”    This notion is not advertising as most recognize it using mass media, but rather the death of advertising, because it alters the interaction in the intermediate communication layer between brand and consumer.  This level of close interaction imposes a tremendously more difficult environment for marketers, as every single media brand exposure has the opportunity to be definitively more valuable and thus requires much more detailed planning and purchase.  It also rewards marketers able to learn, adapt and generally be dynamic.  Interestingly, this does not pose a new paradigm for publishers or producers of content -- but rather, in maturity, should place even higher values on publishers that can deliver high value audiences via quality content and quality environments. 

It’s imperative for marketers to understand that today’s RTB and programmatic environments are immature, with significantly too much focus placed on bidding and price rather than marketing and communication outcomes.  This becomes even more relevant when we consider that most communication channels can and likely will be delivered in some real-time or programmatic capacity soon. There should be no concern that science is overtaking the art of marketing, as the need for creativity has never been more meaningful.   RTB is enabling individual marketing communications at unprecedented scale, which will only grow as more channels become RTB- and programmatically enabled.   

The greater ad tech ecosystem needs to be less insular and start moving the conversation toward the profound impact it can, and is, having in marketing communications -- not about whose tech stack is bigger, who can bid shade better, or who is better at gaming broken attribution models. 

I know we facing a recession
But the music y’all is makin gon’ to make it the Great Depression

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13 comments on "D.O.A.: Death of Advertising".

1. Lubin Bisson from Qzedia Media Inc
   

   commented on: November 29, 2012 at 11:38 a.m.
   Well said. How this battle develops will shape everything about media in a digital age.
2. Joey Jodar from Heavy Inc.
   

   commented on: November 29, 2012 at 12:12 p.m.
   That's a catchy headline - which is one of the basic tenets of effective communication and publishing (and it got me to read the article). The overall premise of the post is interesting however I am not certain the writer has presented enough analysis to draw any particular conclusion other than RTB is here and getting bigger. Curiously one of the fundamental issues with the changes occurring in media - and by media I am referring to the media consumers consume, not the media which advertisers look to leverage through paid and 'earned' transactions - is that those of us on the 'advertising' side of media business continue to forget why media matters: because people consume it willingly and actively. Media is fundamentally about a consumer who see value in the consumption of content, and who in some cases one hopes, will open her wallet to pay for it. However the consumer often does not pay for it; and there are myriad reasons for this including that the media/content owners have not created enough value to justify payment directly from the consumer or that there is such an abundance of similar content that the content is essentially worth little to nothing. (My comment to this post would be an example of low value media). The concern about the current disrupted media industry is that trends such as RTB promise greater value for the publisher/media owner when the evidence indicates we are moving in the opposite direction. Publishers and content owners are learning to produce their content on less and less. And while there has never been more content, ironically advertiser media budgets have not decreased by proportionate amounts. They have actually grown over the past 15 years, particularly in digital and TV, even after accounting for erosion in print, radio, OOH, etc. Therefore those budgets are either concentrating in fewer places or are being spread further and wider. I would posit another theory: It’s also possible that because digital and the prevalence of venture funded start-ups there are many more intermediaries in the mix who are taking greater and greater chunks of marketers' budgets before that budget is invested against actual audience, including now RTB and Exchanges. Ironically nearly 50 years after clients began challenging agency commissions and compensation, a whole cottage industry has grown thanks to digital which has helped itself to commissions and revenue shares that Madison Avenue could only dream of. If marketers want value for their media they should begin looking at how their media budgets are being allocated and demanding and expecting accountability with the majority of the budget going to support media where the audience is and not another service where the intermediaries are helping themselves to greater pieces of the pie.
3. Doug Garnett from Atomic Direct
   

   commented on: November 29, 2012 at 1:50 p.m.
   Why do so many advertising practitioners "wish" the death of advertising? I'm disappointed that MediaPost promotes an article like this.
4. Lubin Bisson from Qzedia Media Inc
   

   commented on: November 29, 2012 at 2:05 p.m.
   Quote: "The Death of Advertising as we know it."
5. Lubin Bisson from Qzedia Media Inc
   

   commented on: November 29, 2012 at 2:31 p.m.
   RTB is only part of the monetization solution for publishers. In combination, 90% of all of our media consumption, or 4.4 hours per day, is happening across four screens. It most likely is the "Death of Advertising as we know it," however, innovation is increasingly going to shift from the device to the interaction between multiple devices. The power of personalized media delivery is clear. Understanding of personalization technology is limited...and the refinement of dynamic "Location Management" in marketing will result in whole new paradigms that will even outflank today's market leaders, none-of-whom are agencies, btw, who are missing the boat so far in today’s uber-connected world.
6. Mike Einstein from the Brothers Einstein
   

   commented on: November 29, 2012 at 5:46 p.m.
   It's going to be the death of something, that's for sure - reason and logic come to mind.
7. Doug Garnett from Atomic Direct
   

   commented on: November 29, 2012 at 6:43 p.m.
   @Lubin - Ah, so it's a good reason to steal that idea from a Sergio Zyman book? My comments remain: Why do so many in advertising loath their work so much that they feel they need to kill it? And, generate these amazingly convoluted arguments to justify seeing themselves as "disruptors"?
8. Lubin Bisson from Qzedia Media Inc
   

   commented on: November 29, 2012 at 10:01 p.m.
   Hey, thanks Doug, I'll have to look up Sergio Zyman.
9. Kevin Horne from Lairig Marketing
   

   commented on: November 29, 2012 at 10:20 p.m.
   "RTB empowers the tailoring of every aspect of a brand’s communication with a consumer"...the lack of knowledge embodied by that single thought about "advertsing" is stunning...RTB is but a pimple on an elephant's butt
10. Rose Ann Haran from PulsePoint
    

    commented on: November 30, 2012 at 9:49 a.m.
    Ed - great article. However I'm not sure that RTB leads to the Death of Advertising. I agree with all of your points that as RTB matures we will move beyond the basic auction model and move into a real time adaptive marketplace where data will provide real time insight into the consumer journey cross screen, device and media. In my opinion, RTB will enable real time meaningful engagements with consumers cross screen - therefore I would argue that RTB will provide the industry infrastructure for better advertising:-) However - as a marketer I smile because the title you chose was provocative enough to get us all talking. Hope to see you soon!
11. Gary Steele from Steele POV
    

    commented on: November 30, 2012 at 9:27 p.m.
    Ed your media petticoats are showing. If advertising is dying it is because many in our industry have put limits on it. Advertising will live as long as their are sponsors and products/services to sell. The creation of brands, selling of products and power of storytelling can not be diminished by technology. We would all be better served if instead of declaring the death of advertising put our efforts toward adapting to the new technology and channel opportunities. The sooner we adapt our skills to the "new world" and stop trying to preserve the status quo the sooner we will achieve success. It is not the what but the how of advertising that is evolving..
12. Domenico Tassone from Viewthrough Measurement Consortium
    

    commented on: December 1, 2012 at 11:10 a.m.
    Great article Ed. The comparison of time spent on searching and watching TV is telling.
13. Vox Usi from The Voice of the User
    

    commented on: December 21, 2012 at 12:57 p.m.
    It's too much advertising that kills advertising... Make it targeted if you want, but make it scarce!

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