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RSSBrand advertising and display advertising are outdated ideas that lack relevance in an online world. We merely dragged these concepts over from traditional advertising. Do we really want to be sharing our industry with bus wraps and heat-activated urinal billboards?
Online display advertising has become the bucket for all forms of terrible advertising. Pop-ups, interstitials, banner ads, Flash ads, and countless others litter our Web sites in lame attempts to generate revenue. We continue to develop new ad formats without any thought as to who is buying them or why.
It is time for publishers to stop sitting on the sidelines while the needs of our customers evolve beyond us. We have allowed a lack of clarity to exist for far too long.
Brand Advertising is just code for "ads that can't be measured and don't make any money."
EVERY ad is supposed to drive revenue for the advertiser; the only question is timing. Our customers can be divided into two distinctly different groups with unique goals:
Transactional Advertisers that are looking for customers to buy their product instantly, or as close to instantly as possible, and;
Influence Advertisers that are looking to influence long-term purchase behavior. These advertisers are selling cars or other products that either have long sales cycles or are primarily bought offline.
Let's break down these two new markets.
Transactional Advertisers: Time is the enemy of transactional advertisers.
The longer customers are away from an advertiser's Web site, the lower the chances they will end up buying something. Transactional advertisers need to instantly engage, demonstrate value, and close the deal.
Transactional advertisers are only concerned with three things. First, they want to immediately drive revenue. Second, they want to be able to measure the cost of acquiring the revenue so they can measure ROI. Third, and most importantly, they want to achieve the first two goals with the least amount of risk.
Transactional advertisers require new ad formats that enable transactions to happen on the spot. Many users are hesitant to click on ads, because they are afraid of losing their place and being taken to another site. Instead, the ad needs to come to them. For example, if I am looking at movie reviews on Rotten Tomatoes, I should be able to buy movie tickets without leaving the site. I should be empowered to use my social data to invite friends to join me at the movie.
Transactional advertisers need an unprecedented level of cooperation with publishers. They need results-driven pricing models like cost per action (CPA), but are willing to pay a premium for results.
If you eliminate risk for a transaction advertiser, you will be rewarded handsomely.
Influence Advertisers: Unfortunately, not every purchase can result in an immediate transaction.
There are several reasons for this. Some purchases, like buying a car, require multiple steps like securing financing (at least until a few months ago) and a test drive. Other purchases, like buying laundry detergent, do not typically happen online.
Influence Advertisers may have a multi-step sales cycle, but they still have a sales cycle.
So how should Influence advertising differ?
We need better ad formats and measurements. Annoying a potential customer with a flashy ad or an interstitial is a great way to damage your chances of winning the deal. The current click-through rate measurement rewards intrusive ads that may drive clicks, but not revenue. Click-through rates average less than 0.5%, so an annoying ad could end up angering 199 potential customers to generate a single click, but not a single dollar.
Why can't the ad enable you to print a coupon for laundry detergent or a test drive in-line without leaving the publisher's site? This would serve as a reminder and dramatically increase the likelihood of you taking action. It would also enable advertisers to track revenue of offline sales.
Influence advertisers need new measurements that track progress on the sales cycle, not clicks. This progress should be driven by in-line ads that enable education and engagement to happen on the publisher's site.
Let's Bury Them Together
If we are to survive as an industry, we need to make drastic changes. The 21% drop in CPM prices this year is a clear signal that we are adding inventory faster than we are adding value.
As any loyal USA Today reader or Fox News viewer can now tell you, a strong economy hides a lot of problems. The recent economic downturn is going to make all of our flaws even easier to see.
Our customers are transactional advertisers, influence advertisers, or both. They buy our product because they believe we can deliver a positive return on investment short-term or long-term.
Let's kill off display and brand advertising, and prove them right.
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I think people that shy away from online banner advertising are those who have not yet discovered how to use it effectively. It's all about reaching the right audience with the right message/product. Hit me up and I'll prove to you that banner is both alive and thriving.
John Lockmer
I forgive them for not referencing this article:
http://www.adweek.com/aw/content_display/news/digital/e3ic19bb33a86fd66429b985553373d44b0?pn=1
Good for you to get there.
Thanks Ned
My experience is that establishing a brand with display advertising remains effective and even more so today. Display advertising drives revenue. This economy will prove again as has previous downturns that advertisers that maintain display advertising and especially those increasing their A to S ratios gain market position and share. This is an opportunity to emerge stronger by having a greater share of voice. It’s good for my brands when competing brands pull back from display. Collectively this does more to improve my position, especially if all cut back. I believe that today because of the market conditions display advertising is more effective doing what it does best.
For the Internet world, using display advertising to build a brand has been a core strategy for many. GoDaddy is now an established brand because of their display advertising and brand building efforts. I argue as a result they get a better ROI and immediate dollar return with various non-display media elements. We may like or dislike the content of ads and may not care to see so many in digital or traditional media and popping up and appearing so often, but getting the name out there and establishing the brand is the way to improve ROI and increase returns for all media elements as a whole. All media have their merits and developing the right mix is time and gain proven the most effective strategy.
...and I'm not reporting. I'm giving my opinion.
And I'm glad people (including you) challenge it. That's the only way you get to the best thinking.
David.
That poor quality exists on both sides of the aisle, in my opinion.
I was making the argument that brand building, in and of itself, is not the goal.
Driving revenue is.
Sad that the network I like is getting so personal on their affiliations...
Push vs pull, talk about a hot prospect that visits a site and gets branded. While you might take "30 seconds of TV exposure over 30 seconds of banner ad exposure 100 times out of 100... Most CMOs that I know 1000 times out of 1000 would rather have consumer self-directed ad clicks choosing to visit their website wanting specifically learn about their product, rather than trying to convince a bunch of couch potatoes in 15 or 30 secs.
I actually think that the right approach is exactly what is happening today, a mix of online and traditional media to reach a larger universe of consumers that choose their own flight plan of engagement.
Finally, I think your articles premise and conclusion is a bunch of nonsense. Ever heard of a company called Dynamiclogic? Its an objective third party research company with countless positive studies of BRAND impact from online display campaigns using control vs exposed groups. How do you explain away all that evidence vs your opinion that doesnt have a single data point?
All purchases (with the possible exception of “grab bags� that we experienced as kids) begin with awareness independent of when the transaction occurs. And display advertising fits this role exceptionally well. The challenge is to measure the brand impact of each impression which can, in fact, be done effectively and efficiently online.
While measurement is essential for campaigns of all types, it alone does not solve the core issue discussed in the article: ROI. For this, someone has to review (and most importantly, take action upon) the acquired metrics. A DR campaign with no one examining the CTR is as bad as a branding campaign without any measurement.
Let’s employ measurement for online branding campaigns and online display ads will be superior to their counterpart in the traditional world.
Time spent is only one measurement, and it's not a measurement that applies evenly. I would take 30 seconds of TV exposure over 30 seconds of banner ad exposure 100 times out of 100.
And interstitials are still everywhere. Go no farther than Forbes.com if you want proof.
I have to ask; did you write this or forget to post your comments from 1999? Since it is the impetus of your point, what sites do you visit that use pop ups or interstitials?
Except you have no budget, production time, or comps. That's why brand advertising is so prevalent. It's the proof that anything "free" diminishes your overall campaign value. Brand advertising is the only creative that fits these units.
Both Display and brand advertising are captured in pieces of my redrawn lines of Transactional Advertising and Influence Advertising.
I think we need to become more active in the process of helping advertisers to define the goals and measurements of those goals. (Dipanjan hits the nail on the head about needing help to measure success)
There is no question that online advertising can add a ton of value, but we will not realize that value fully until we better align advertising to ROI.
This doesn't really address your point about display, but how else do you suggest publishers monetize their traffic? Rotten Tomatoes (or any site for that matter) wouldn't be around to review and ignite the conversation about these movies if it wasn't for the ad revenue that supports them. I can't imagine a subscription model would work for movie reviews. Affiliate deals (i.e. if they sold movie tickets via an online movie ticketing vendor) don't yield nearly enough revenue to support these sites.
You may feel display ads look awful (and a lot of the CPA creative is), but there's a whole generation out there that's quite accustomed to them, and a new generation of ad shops creating amazing banners and user experiences.
I guess my point is that it's getting better and it's a working revenue model for the web
And I don't think David is saying here that the Net is necessarily a bad place for branding. But I do think he is arguing that all branding/influence can be measured if we just think of the right metrics; he thinks its time to for us to bury Wanamaker's law. But Wanamaker is going to be around for a long time...while I may have numerous positive associations with Coke, Charmin, etc.. I never have, and likely never will use a coupon for Coke, or click on a Coke banner, or answer a survey about what soft drinks I feel positively about. Influence may ultimately be unmeasurable in a micro sense for certain products -- and some of the performance based results you see may actually be false positives or counterproductive. So the kinds of people who clip coupons, or sign up for "test drives" for say, Volvos, may not actually be the kinds of people you ultimately want to attract as buyers.
Why do we keep telling advertisers that banner ads are about pure conversion and ROI? Piper's comments are right on point. Marketing and advertising is not simple. Its about building a brand. And banner ads are very successful at building brands.
We need a better way to measure and report the value of brand building to our advertising clients. We need to think more creatively about the future of banner ads so that ad sizes and other ad technology support brand building objectives. That includes providing a stronger experience with the brand, without leaving a website.
This is a great time of growth for our industry and I'm eager to see some new creative solutions that allow this industry to over deliver on its promise of advertising value.
We white-label our service for many large publishers and have both banner advertising and contextual advertising support built in. Some use it, some don't. It's the publisher's choice, and we do not care either way.
I'm not arguing that building brands is not important. I think you missed the point. I'm arguing that building brands is not the goal, driving revenue is.
Of course it's bad to anger users with obnoxious and intrusive ads. Nobody wins if that happens -- not the advertiser, not the publisher and certainly not the user. We should always strive to find ways to make advertising useful, informative and/or or entertaining. Does that mean that all display advertising should go away? Absolutely not. Does that mean that online can't be used for branding? Hogwash.
It's not as if brand advertising theory was created over night. It's much more complex that merely influencing a user but I guess Mr. Koretz needed to over simplify things to make his point look plausible.
What we don't need to do is not take shots at other sectors of the industry just because the company we work for (or started) doesn't offer a particular type of product. What we DO need to do is work together to improve measurement of all online brand advertising opportunities, including display.
At a recent industry breakfast, Young-Bean Song, VP of Analytics at Microsoft’s Atlas Institute, said that “59.6% of all searches online are for brand terms.� So I ask you, how does a user know to type in a particular brand term if they’ve never heard of it before? They can’t – they need to see it or hear about it before they can know to look for it online or ask for it in a store. One way users can discover a new brand, or to be reminded about an existing one, is to notice a display ad. It’s not the only way and it’s not without flaws but it shouldn’t be eliminated from consideration completely.
Speaking of Atlas, here’s a perfect example of a company that’s trying to improve our ability to measure online advertising’s impact on the sales process through what they call “Engagement Mapping.’ It’s not the silver bullet but it’s a huge step in the right direction.
This article itself is a perfect.The author takes over 800 character of our time discussing Advertizing 101 (defining "transitional" aka direct marketing and "influence" aka brand marketing), when we are looking for is ideas and solutions to the issues. Not to mention that the delivery was surrounded by the very ads the author distains.
WE as advertisers need to get back to helping our clients define value and purpose so that when audiences click through ANY delivery method they get something they want or need.
Love, love, LOVE your insight! SO RIGHT ON!
Marketers AND Publishers need to work from the creative mind, and dump their contentment with throwing crap on the wall and being happy with what sticks! Serve the customer/reader/audience first, and revenue will follow.
JJ Rusch, Publsher Chicago Wellness Magazine
Fox News and USA Today continued to message a positive economic outlook until the bottom fell out. Uneducated readers/viewers believed it.
The economic issues we are experiencing have been delivering warning signs for the greater part of a decade.
Now that the lipstick is off the pig, we are going to have to take a hard look in the mirror.
Furthermore, I completely discounted any shred of credibility when you supported the closing paragraphs of your article citing "loyal USA Today readers and Fox News viewers" as your acid test for economic validity.