Always a lively topic of conversation, online ad spending is down 5% for the first half of the year and "ad blindness" on the part of anyone who spends time online is rampant. The consensus is that
search advertising, driven by Google, has already fired the shot that is slowly but surely killing display advertising.
It's true, online display advertising has all the earmarks of an
industry in decline, and yet with the hours of online time continuing to trend upward and the steady decline of print ad vehicles, it's a medium that can't help but grow - at least in the short term.
However, continued long-term growth is going to require fixing fundamentals that today are clearly and dangerously broken.
There are three important steps the industry should take to fix
online display advertising, along the way boosting its efficacy for advertisers and entrenching itself as a long-term successful industry.
1. Get transparent.
It's
true that transparency has quickly become a buzzword in advertising with many definitions, but that doesn't minimize its importance. Some view transparency as complete reporting of where an ad showed
and how successful it was. Others view transparency from a user perspective, and define it as and openness in helping users understand why they're seeing an ad. My view is that it doesn't matter --
transparency is a good thing no matter how you define it.
Ads targeted to a specific subset of web users must be able to produce a map of how they got there: what data was used and where it
came from. Even if it's true that consumers aren't as rabidly protective of their online privacy as lawmakers are, transparency is a vital business practice.
Another example -- advertisers
have extended their online reach through the proliferation of ad exchanges in recent years. And while there is tremendous value and efficiency in online ad exchanges, without transparency it's
difficult to guarantee the quality of the impressions and without the quality, the additional reach doesn't matter at all.
And while we're on the subject, why don't ads tell users why they
are being targeted? The general industry fear is that users would revolt if they knew that they were being targeted. Guess what? They know. And even if they didn't it's simply not ethical to hide
it from them especially since study after study shows that they really don't care as long as they understand the tradeoffs.
What if there was an icon at the bottom of every display ad that
a user could click on to find out exactly why they are seeing the ad in front of them? What if they could then share preferences to make ad targeting better and make the ads they see more relevant to
them? This kind of transparency would go a long way to both reducing ad blindness and increasing the efficacy of advertising simply through engaging the user in the process.
2. Use
quality data for ad targeting.
Ad targeting technology has matured and is considered a vital tool for advertising. Without targeting, ads can only hope for relevancy. But what's often
taken for granted is the data that drives the targeting. Without consistently good data, targeting is worthless.
Data quality requires perpetual vigilance to make sure its properly
collected, classified and employed, but it also requires industry standards for online profile components, intent data and historic click data.
And remember step No. 1? All use of data
should be transparently collected with options for audience editing and opt-out.
3. Find a new way to measure efficacy.
I'm not the first person to suggest that the
click measurement just doesn't make sense any more, but there isn't widespread unanimity on what should replace it.
To truly measure an ad campaign's success requires the measure of multiple
factors including search data (a recent Forrester study shows that audiences are just about as likely to do a search on the name of the advertiser as they are to click on the ad itself), social media
chatter, and website traffic from other sources. Additionally, site engagement metrics like number of page views, time on site, and cart size for e-commerce sites need to be part of the measurement
mix as well.
Measuring all of these channels before and after display campaigns will shed light on the value of the ads in a way that measuring clicks never captured. When this measurement
is done, as shown in a recent study by ComScore, the results are staggering and clearly demonstrate how significantly display ad spending can affect marketing results.
Likewise knowing your
audience (see step No. 2) will go a long way toward understanding the value of your ads. Being able to fine-tune the targets of each through the use of solid data will make it easier to measure
efficacy by narrowing the sample.
Other brilliant minds in the business will argue about the continued importance of creative and brand for online display ads and I don't disagree. But from
where I sit, transparency, high-quality, data-driven targeting and better measurement is a clear prescription to heal the illness affecting online display advertising.