Yet There Is No Outrage
In one discussion group of highly experienced marketing folks I belong to, a couple of them shrugged the online fraud off as "the cost of doing business." On the TV side, there is grumbling by agencies that being outed for inefficient or ineffective ad buying is unfair.
In any other business, if someone said, "You know, you are getting screwed to the tune of $10 billion a year," there would be investigations, CFOs would scream bloody murder, and heads would roll. But not in the ad business. Which is really curious since everyone claims they are more interested in accountability now more than ever, and are doing everything from consolidation to automation to bring costs down. Yet there is no outrage.
While this is not exactly like the proverbial $500 toilet seat that contractors routinely charge the defense department for, there seems to be a similar Pentagon-like lethargy in the ad business, because getting to the root cause of the misspending may be too time-consuming, too hard -- or more probable, the clients don’t really care. But they should.
There was a much-discussed story in The New York Times last Sunday focusing on whether Big Data is really adding much to the economy. While at this point it is hard to point to how it is adding to the GDP, it is easy to see how it can be used to spot trends that can be used (or ignored) to improve the bottom line. I have another client whose Big Data can help retailers solve this problem: If a visitor to your site needs an incentive promotion to become a buyer, what is the right offer? 10% off? Free shipping? Two for one? You might know the right (and least costly) answer if you have seen the visitor before and have some idea of his/her past history. But what if you have NEVER see this browser before? You only have seconds to make a decision. What's it going to be?
In both cases of online fraud and inefficient TV ad spending, the companies are reviewing MASSIVE amounts of data to spot trends and make recommendations to prevent harm. While the processes unto themselves do not raise anyone's bottom line, the application of their solutions do.
Everyone who has a business that scales as big as the major ad agencies suffers from inefficiencies (and I suspect a little fraud here and there). But to write it off as "the cost of doing business" is irresponsible and ultimately unfair to their clients. Yet there is no outrage.