• by George Simpson , Featured Contributor, June 3, 2011

In remarks he made recently, Sean X Cummings, chief digital strategist of Suite Partners, said: "We have created an analytics beast in our industry, behavioral marketing, predictive analytics, click-through, view-through.... AD-nauseam indeed.... all providing the illusion we can know what's in peoples' minds and why they make the decisions they do, without ever asking them or studying the why behind not only their actions, but the environment outside their actions.... It has done our industry a great disservice."

This is a sentiment shared by lots of folks in the online advertising industry (when they aren't out trying to sell the very thing Cummings laments). To many, online ad technology has outpaced our ability to harness it and put it into a horse collar that will drag brands out of TV and into the interactive world of the Web. They blame snake-belly CPMs for the technology that can place ads on the remotest unread pages of millions of Web sites where they go unnoticed or ignored. They screech about how tracking technology violates user privacy and how each new alphabetical iteration of ad buying or selling simply adds another layer of unnecessary complexity and does nothing for brands -- and everything for the guys taking a percentage of every deal.

I get that. But I think it overlooks a few points worthy of discussion.

1) Online advertising has continued to grow. The Interactive Advertising Bureau and PricewaterhouseCoopers just said that Internet advertising revenues in the U.S. hit $7.3 billion for the first quarter of 2011, representing a 23% increase over the same period in 2010. This marks the highest first-quarter revenue level ever for the industry and a significant increase over last year's first-quarter revenue level, which had been the highest on record to date. So, something must be working right. Some of those predictive algorithms are correct -- because if they weren't, the online ad business would be in a nosedive rather than soaring.

2) Technology has produced some pretty cool ad units that can do everything from dynamically updating themselves based on your location or your past proclivities, giving you three or four options of what kind of information you'd like, or walking your dog in the rain. In other words, it hasn't just been about audience segmentation and ad serving. Build a better mousetrap, as they say.

3) The "evilness" now attributed to ad technology such as behavioral targeting is not only misplaced, but it forgets why BT was ever started in the first place. Before BT, publishers did not have a clue who was on their sites (remember "eyeballs"?) nor what they were doing there. All they saw were "hits." Which is why advertisers did not drop their drawers and say "Me next!!" It wasn't until BT began to record what folks did online overtime that some reasonable deductions could be drawn about who these users were and who was inclined to click on one ad vs. another. And you know what -- serving targeted audiences ads that were more relevant to their lives than those ROS smack-the-monkey ads worked, and clicks and engagement went up.

Now, you might argue persuasively that the follow-up efforts to further refine audience profiles and determine how and why someone might like to see one ad over another have simply been splitting hairs, instead of adding to the body of actionable knowledge that would help brands sell products and services.

I get that.

But I think this notion of throwing the baby out with the bathwater is simply a reflection of the frustration we all endure trying to keep up with every Next Big Thing in online advertising. The pace of change seems relentless and more complicated than ever. Yet in just a decade and a half, the online ad industry has arguably grown revenue faster than any other ad-supported medium in history, outpacing some sectors that have been around for hundreds of years. Yes, Google is the biggest part of that growth, but they are ALL about ad technology and algorithms.

So pat yourselves on the back. Somebody is doing something right.