It's not easy being a consumer. Current estimates indicate that the average urban dweller is exposed to between 3,000 and 5,000 advertising messages every day. That means, settling on the middle
number, that every waking hour (sleep seems to be our only reprieve, and I hear they're working on that) you're presented with an ad every 14.4 seconds. That's every 14.4 seconds, every minute of
every day you're alive. The frequency of this advertising barrage has doubled in the past 30 years.
"Are We There Yet?"So, let's imagine that your 5-year-old
child interrupted you every 14 and a half seconds with "Moooommmm..." or "Daaaaddd...". If we use my patience limits as a baseline here, that mean's you'd last about 1.3 minutes before you went
ballistic. The difference, of course, is that we're genetically hardwired to pay attention to our children, much as we sometimes might try not to. We've been conditioned to ignore advertising.
But what happens when we really want to buy something? Suddenly, we're looking for information, and we spend a lot of time doing so. At least, that's true for some purchases. Take a computer,
for instance. It's not unusual to spend 10 to 15 hours researching a computer purchase, from the minute you decide you need one to the minute you tear open the box in your home. That's not including
the many hours needed to get your "plug and play" box actually playing after plugging.
The Cost of Consumer Research
Of course, we generally don't put a cost on
our time, but let's say an hour of your time is worth about $40 (an average rate for someone making $75,000 per year). That means that $1,000 box of electronics cost you an additional $600, just in
time spent to pick the right box.
The Internet is not making this any easier. Yes, as consumers, we're armed with more information sources, but we spend a lot of time sorting out sense from
nonsense. The explosion of information sources, both the good and the bad, mean we're spending more time thinking about what we should buy. A study by
ScanAlert found that that across many ecommerce categories, the average time to buy has increased by almost 79%
in the past two years. Now, this was just the duration from first visit to purchase in the actual online store. It doesn't include any consumer research before visiting the store. But I think we're
safe to assume that there would be a corresponding increase in the amount of online consumer "tire kicking."
I
t's No Picnic for Advertisers EitherBefore you
feel too sorry for yourself, let me tell you, it's not easy being an advertiser, either. How do we get past the filters? How do we stand out from the other 3,999 messages you'll hear today?
To recycle some research I did for a
previous column (because research is a terrible thing to waste), the Ontario Tourism Board ran
newspaper ads in Toronto targeting people looking to vacation in the province. The ad cost (at posted rate card rates) about $54,000. Even with an exceptional response rate, that ad might sneak though
the filters of 1,700 or so people and actually catch their attention. This works out to an average cost of about $32 per introduction, or, to put it another way, $32 to tear a hole through that
advertising barricade you've been building.
Got a Minute? I'll Make it Worth Your WhileSo, if advertisers are willing to pay to get your attention, why not cut
out the middle man and pay you directly? Why should the
Toronto Star get all that money, when you're the person the advertiser wants to talk to? What if every one of those 4,000 advertisers
who are going to try to get your attention today (Consuummmerrr...Consummmerrr!) paid you a dollar to listen to what they have to say? You'd do okay financially, to the tune of about $1.46 million a
year. Of course, your brain would explode after the first hour.
The concept is not as far-fetched as it seems. In fact, in 1999 John Hagel III and Marc Singer, both principals with McKinsey
and Company, wrote a book called "Net Worth" that explored this very premise (along with a number of others) as a potential online business model. The book provided a detailed business plan for a new
concept: the infomediary. Some of the details have been passed over in the last eight years since publication, but the basic premise still addresses a significant disconnect in today's advertising
marketplace. Next week, I'll lay out the foundation of infomediaries and look at how some of our favorite search players seem to be inching their way towards Hagel and Singer's proposal.
We
now return you to your regular commercial onslaught
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