How's Business?

If you really want to know how well, or how badly, the Web advertising industry is doing, it's useful to attend a gathering of its participants--one of those trade shows that used to be quite a bit more ubiquitous than they are today.

For the most part what you'll see is a magnified version of reality: last year, when things were still going well, you would have thought everyone attending had just been paid a visit by the Publishers Clearing House Prize Patrol.

This year, under vastly different and more challenging circumstances, few dare ask 'how's business?' for fear of what they'll get in response. Last year a phrase commonly heard at trade shows was "We're the ones that get it." And in the past year, we're certainly the ones that got it.

So it was interesting to visit a trade show recently, to learn about new developments in Web advertising but mostly to take the pulse of the industry. The trappings still had a hint of the old bravado: after entering the building through a neon escalator that looked like something out of the mother ship in Close Encounters, we were led to a well-appointed conference room and given slick goody bags filled with all kinds of wonderful trinkets and trash. Noticeable differences: many more suits and ties, and a much more subdued tone than ever before.



The premise of this particular show was that because banners and buttons aren't sufficiently powerful advertising formats, it is necessary to turn to technology for new and better answers. And clearly the Web isn't short on innovation: we were treated to a parade of new technology-based ideas, each reaffirming the view that we must move beyond banner ads.

As each new technologist made his presentation, several themes showed up with some frequency. One that was echoed by practically all was the concept that we are still "in the early days of Web advertising." The consensus appeared to be that the industry began sometime between six and nine years ago and, since we're still relative babes in the woods, we've made every conceivable mistake so we can now learn from them and move rapidly to a much brighter tomorrow.

The second theme redundant to most presentations was a damning of the industry pioneers that made all those mistakes: They didn't pay attention to their customers, they wasted all those cheap venture capital dollars, and they over-hyped the medium.

The third theme, proceeding directly from the second, was that we have now seen the light: We must focus on the marketer's objectives, attract and motivate the consumer, and be able to measure and account for results of Web-based campaigns. But, as we are still "in the early days of Web advertising", we can be expected to make a few more mistakes before things really get better.

The last common theme, the one that would have probably won the prize as Biggest Heresy a year ago, was that the days of giving things away for free are over. After several years of straying into insanity, marketers are now back to making money the old-fashioned way: by selling stuff.

The new technologies, truth be told, were mostly dazzling. The focus was on delivering information to the consumer in an impactful way, but without wasting the consumer's time or abusing bandwidth (although the general assumption seemed to be that broadband is here today).

And the audience, which had started the day in a subdued state, came alive under this barrage of innovation.

- Michael Kubin is co-CEO of Evaliant, formerly Leading Web Advertisers, one of the web's leading sources for online ad data.

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