Time-Based Digital Ad Pricing Unites Media, Creative Teams

One of the most widely heard comments in advertising today, particularly on the digital side, is that there’s a quality problem. People are blocking ads. People are ignoring ads. Too many ads don’t work. The solution for this, we are told over and over, is simple. We need better ads.

In the real world, however, things don’t get better just because people think they should. They get better when people have some incentive to make them better. And they also only get better when there is some general agreement, backed by data, as to what “better” actually means.

In some areas of the economy, we have that.

Take restaurants, for example. Lunch at a high-end restaurant will run you somewhere from the high two to the low three figures. If you buy lunch at any major QSR, you’ll get back change from a $10. The diners at both establishments are comfortable with these numbers. They think they’re getting a fair deal, because they have a definition for quality.



This kind of transparency also exists in some corners of the advertising market.

If you want to run an ad in the print edition of The New Yorker, there are some quality hurdles it’s going to have to clear, in terms of both content and production values. On the search side, Google has developed a whole system of logarithmic solutions for promoting quality ads and Web sites.

Facebook uses an auction system designed to evaluate proposed ads on the basis of their impact on the overall value of the entire Facebook content ecosystem.

It’s your fault. No, it’s your fault.

Advertisers and agencies comply with these requirements, because they want what’s being offered and they agree on its value. In the multi-publisher digital ad world, this kind of agreement does not exist, which tends to lead to divisiveness and finger-pointing.

Media agencies say we need better creative. Creative agencies say we need better media plans.

What we actually need is a way to define and measure what we’re talking about. One potentially effective way to do that would be to move to time-based ad pricing, in which the advertiser is charged only when a consumer actually clicks on an ad and interacts with it.

This would give all parties a definition for quality:The more time people are willing to spend with an ad, the higher its quality in terms of delivering the advertiser’s message. If they won’t open it—or if they bail in less than a second—it’s not a high-quality ad. And that judgment is data-based; there would be nothing to argue about.

It would also create both an incentive for making higher-quality ads and some guidance as to how to do so.

Publishers would have an incentive to offer time-based discounts to advertisers who capture more attention with fewer interruptions. Creatives would have data to guide them in their work: if X ad gets more time from readers than Y ad, what is it about X that works better?

And everybody—publishers, media agencies and creative agencies—would have a common language in which they could talk about the same things, using the same words and metrics. Rather than being at odds, they would be positioned to collaborate in developing more effective advertising and placing it in the context of more effective strategies so as to generate more business for the client.

Isn’t that our goal?

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