How Online Advertising Is Starting To Look Like TV In The '60s

The online ad business in 2016 is starting to look like the TV ad business in 1964.

In 2003 and 2004, after the dot-com bubble had burst and things started to come back from the dead, the industry exploded with new providers and platforms as programmatic started to gain a foothold.  The omnipresent LUMAscape was born, and the ecosystem became cluttered with hundreds of companies vying for your dollars, with all of them doing something derivative of one another. The role of the digital media planner was complicated because you had hundreds of new companies to choose from.  It was the best of times, it was the worst of times.

Fast-forward to the present: The economy is unstable, and the ad business is starting to consolidate.  Mobile is a powerful force alongside desktop display, and the players who can unify an audience across these channels hold the power in a significantly simplified ecosystem. 

There still may be hundreds of partners, but consolidation and lack of funding is creating a world dominated by the 80/20 rule, where 80% of revenues are focused on 20% of the players.  The big winners these days are companies like Google, Facebook, Twitter, AOL/Verizon and some of the large publishing companies.



The role of the media planner is simpler: Your clients won’t fire you for buying Google.  Companies like Google provide a multitude of choices, so if one solution isn’t working, they can provide another.  This walled-garden approach functions alongside a consolidated open Web, and the dollars are getting more and more focused.

It’s much like the ebb and flow of TV over the years.  In 1965, advertisers had three options.  In the '80s, the TV business expanded due to the growth of cable, and now TV is the cluttered channel, while digital is more focused, like the TV landscape of the ‘60s. Spending money is becoming easier in digital than it is on TV.

This realization is a new one, and the only underlying complication is data.   Data is what has made consolidation in digital practical, as programmatic platforms combined with addressable delivery have made it easier to focus your money and still be targeted.  It's not solely about the context anymore, because you can slice and dice the audience and focus your dollars on a subset of the content.  

TV is a diverse platform with a wide range of content options, but it still hasn’t progressed to enable addressable delivery at scale, although it is certainly headed in that direction.  Digital offers the wealth of content options, but data enables that audience-targeting component. 

That ability to deliver subsets of the audience while still aggregating a large-scale volume is why the online business is an “easier” option, and why TV still has a ways to go.  It’s about limiting waste. TV still has waste embedded in how you buy, while online no longer does.  

Once again, looking into the future you can see further consolidation no longer driven by the channel, one more focused on the cross-channel partner. For example: TV partnered with digital and consolidated on partners like Google and Facebook, plus Comcast and Time Warner, plus AOL/Verizon and AT&T.  All these companies, whether through their own methods or through partners,  can provide a view of the consumer across channels and activate that view with effective ad vehicles.  They can establish frequency with targeted reach, and through customized delivery that identifies where in the customer journey that consumer may be.  This is exciting.

What’s different from the model of TV in the ’60s is the element of proof.  In the ’60s you spent your money to deliver a message, and you hoped it worked.  These days we have the tools to prove the value of that messaging, which is a very important concept.  

And, of course, we’re a little hipper than many people in the ’60s.  Don Draper, eat your heart out!

2 comments about "How Online Advertising Is Starting To Look Like TV In The '60s".
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  1. Ed Papazian from Media Dynamics Inc, March 16, 2016 at 4:02 p.m.

    Cory, your observation that TV is much more difficult to buy today than in the 1960s is, of course, correct. There are many, many more channels and programs to consider and ratings are fragmenting, causing advertisers to buy more channels. So far, so good. However, I'm having trouble with the idea that then--in the 1960s---advertisers spent their money and hoped it worked. Not really. By then, most national advertisers with any savvy at all, were pretesting their commercials and airing only those ads that the tests showed would be effective. Their goal was to build awareness and brand preference and this was measured along with sales results in the marketplace. So advertisers had a very good---if not perfect---read on what was working and what was not.

    Fast forward to today and you are contending that TV is moving towards the no waste " ideal" that so many people keep talking about and that digital already offers that. I'm not so sure of that. Moreover, you are claiming that digital enables the advertiser to know exactly what the results are for every ad that is exposed to a targeted consumer. How? Are you referring to ad awareness or brand preference gains per exposure? I think not. Are you referring to CTRs and related electronic indicators? Most likely. But even if the typical TV-oriented advertiser no longer cares about brand awareness and sales motivation, which develop incrementally over the course of many exposures,  but only what happenes every time an ad is "seen"---which is the direct response, not the branding, viewpoint----isn't it true that only a small portion of any digital ad's supposed audience per exposure gives any indication of response? What about the vast majority who take no action? Do we assume that the ad had no impact upon them? Of course not.

    Where I differ with many people who claim that digital provides "attribution" while TV must move in that direction---or else---is their definition of advertising, itself. Most of the attribution means everything advocates are trying to impose direct response rules upon branding campaigns and push TV into being exactly like digital in tems of metrics and measurability. This is the underlying reason for the constant barrage of claims that "linear TV" is dying and digital TV will replace it. But I doubt that this great "awakening" will happen, not only because one would have to hook up every TV set to some ad delivery system--how?----and, more important, because instant, person by person response indicators, while nice to have, are probably never going to be available---unless we hook up every viewer to the same ad delivery system and find a way to read their minds as well as their click-through- rates.

  2. James Siciliano from Channels:360 replied, March 17, 2016 at 8:35 a.m.

    Well stated Ed.  

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