What Will the Post-Arms Race Online Ad Market Look Like?
Would the future bring ultimate victory over Communism, or would Russian tanks roll down the Long Island Expressway? I was in the sixth grade in 1984, and I didn't have the foresight to predict things like the fall of the Berlin Wall and the collapse of the Soviet Union.
Now the online ad market is involved in a similar Cold War, with advertisers and publishers on one side, and the consumer on the other. Technology providers cater to both sides, with makers of ad-blocking software helping consumers experience an ad-free Internet and ad servers and rich media providers helping advertisers get their messages in front of the consumers, many of whom would love to strip all these messages out of their online experience.
This is the new arms race. Just as rich media and ad serving technologies begin to get traction and make the lives of advertisers and agencies easier, the consumer strikes back with pop-up blockers, spam blockers, and ad strippers.
We've seen several columns in this space about Firefox and how it continues to gain traction with Internet users. Not only does it do a great job of blocking pop-ups, but an easy-to-use companion to Firefox, Privoxy, strips out ad content altogether.
Peer-to-peer spam solutions keep commercial e-mail out of in-boxes by allowing groups of people to decide for one another what is spam and what isn't. And popular anti-spyware tools also allow Web users to delete cookies from common ad servers, which can wreak havoc on tracking and reporting for Web advertisers.
How have we responded? I'd argue we haven't. One of the reasons why we haven't done this is because we don't want consumers to look at online advertising as something they need to protect themselves from. There shouldn't be an arms race.
Many online advertisers have strayed from pop-ups and the urge to saturate the Web with them. But for every advertiser parting ways with pop-ups out of concern for the consumer experience, there are many direct response advertisers who would gladly take their place with hard-sell messages. With pop-up blockers and Firefox both gaining popularity, we could deal with the pop-up being slowly strangled over time.
The same goes for commercial e-mail. Many advertisers have strayed from list rental and standalone mailings in favor of newsletter sponsorships or building and maintaining their own in-house lists. The spammers will fall victim to better technology on the consumer side, and brand advertisers who don't spam need not worry too much.
But what about cookie blocking and cookie deletion? A number of industry experts I've spoken to informally about this problem seem to think that the number of Internet users who block or delete cookies is not tremendously significant. The problem has been largely ignored.
Unlike spam and pop-ups, cookies are not necessarily evil. E-commerce engines and Web sites depend on them to remember users when they visit, or to keep track of what's in their carts when they shop online. Ad servers use them to track back-end sales or leads, as well as to rotate ads in appropriate sequences and measure frequency.
But what happens when cookie blocking and deletion becomes easier for the consumer? When browsers routinely block cookies from the top ad servers? The fear that we'd be back in the Stone Age, technologically speaking, mirrors my adolescent fears of nuclear annihilation.
Consumers have little to fear from cookies, but the common understanding among the average consumer is that a cookie is somehow "tracking" them from place to place. If we allow this perception to continue, it might not be long before we're back to the days of shipping individual ads to publishers and counting clicks instead of leads and sales. No more attributing sales to the ads that referred them, no more banner sequencing, no more frequency distribution reports. Can we afford to take this step back? (That's a rhetorical question, folks.)
This arms race shouldn't be an arms race. We need to educate consumers instead of trying to one-up them constantly. Internet advertising needs its glasnost, and soon.