When Lee Clow, arguably the single greatest creative talent in advertising history, offers that frank an assessment of online advertising, it behooves us to listen. After years of focus on the internet, with its explosive growth, the Great Migration of Advertising Dollars and the endless buzz of how it will change the world, it's high time that serious marketers ask the following: What, exactly, is online advertising actually delivering?
Online marketing has emerged as a mix between search advertising, behaviorial targeting and conventional advertising media adapted to the internet. Search has done very well and its utility can't be denied. More akin to helpful recommendations, it's a billion-dollar business and deserves to be, because paid search represents a mutually beneficial relationship between consumer and advertiser.
But the same can't be said for other forms of online advertising. In Nielsen's 2008 Media Comparison study, only 5.1% of respondents ranked online advertising as "influential." The other 94.9% treat billboard, skyscraper and pre-roll ads like the rest of us -- as brief distractions soiling the content we care about. Video-based advertising might eventually offer some promise, but let's not forget that only 20% of all internet users consume 85% of all video (which, according to ComScore, is mostly You Tube videos, such as the wonderful world of adorable dancing pandas). Very few internet users consume an appreciable amount of online video and, as a result, there's no substantial market yet for online video advertising.
Then there's social networking, the vanguard of behavioral targeting. Beautiful on paper, social-networking advertisements promise to use the information freely volunteered by consumers to target just the right ad to just right the right person. In practice, click-through rates are pathetic. There's room for innovation in that space, to be sure, but Facebook's Beacon wasn't it. For those of you that missed or tried to block out the memory, that's when Facebook advertised the purchases of its members, hoping to create de facto product recommendations. Tens of thousands of Facebook users protested, and Facebook removed the program under a cloud of user malcontent.
Can you think of even one "Just do it" or "Quicker picker upper" that came from advertising on the web? With the exception of several online-only brands, such as Amazon, e-Bay, YouTube and iTunes, that kind of brand building recognition is still primarily the job of TV. People don't click on online ads; they avoid them. And without a healthy relationship, the internet can't fulfill its raison d'etre: interactivity. For the large part, unless consumers are actively seeking out information on something to buy, most of the advertising is, in the words of the estimable Mr. Clow, "semi-nowhere."
|ABOUT THE AUTHOR|
Robert Rosenthal, former president of TBWA/Chiat/Day Latin America, is a partner in BrightLine iTV Marketing Specialists, an Emmy Award-winning provider of data-driven, interactive experience design.
That isn't to say, however, that the digital age has failed and we should all pack our bags and head back to the 1980s. There is a technological and marketing revolution afoot; it just isn't where we thought it would be -- namely, on the internet. It's back in the consumer's living room.
Don't get me wrong. The web obviously is a necessary and valuable tool, as shown by the savvy marketers that have used it effectively for consumer feedback and customer-relationship management. It's just that when it comes to paid advertising, it has been a disappointment in spite of having been lauded by many as the replacement for many other so-called traditional media. In some cases, it is the so-called traditional media that can provide more engaging interactive experiences than the web. Consider, for example, TV.
While broadband penetration has actually started to plateau at 55 million homes, the number of homes subscribing to digital TV is close to 70 million, up 48% in the past three years. Marketers might want to return their attention to recent developments in TV, which is reinventing itself to confront new business realities largely brought about by advances in technology.
Digital technology has transformed the TV-viewing experience, and TV viewing is evolving into an increasingly demand-oriented medium: Comcast alone generates 275 million video views monthly -- collectively its customers select video-on-demand offerings 100 times per second. Comcast is on pace for more than 3 billion video streams a year and its 13 million digital TV households represent only one-fifth of the blossoming on-demand/interactive TV market.
TV viewers are also demonstrating an appetite for interactivity through their remote controls. Research reveals that 70% prefer increased control over their content choices. This convergence of digital technology with America's TV hobby can be a ripe avenue for smart marketers, if it's understood and not abused. When properly prompted, TV viewers enter into instant two-way communication with advertisers -- at impressive rates and for considerable time -- without ever having to remember website addresses or leave the comfort of their couch.
So now media sages such as David Verklin are loudly proclaiming that the "TV space is ripe for invention and reinvention." Well, that started about five years ago. The revolution has already arrived. But while many in TV advertising continue to talk a lot of digital talk, far fewer have actually walked the walk.
One notable exception is Unilever, among the world's largest and most innovative advertisers, recently recognized by Ad Age as "Digital Marketer of the Year." Unilever VP-General Manager Kevin George knows from experience that interactive marketing is not just online when he called interactive TV advertising a "pillar of our strategy to become a digital brand because we're learning that our TV audiences will click and get involved."
By providing instant access to almost anything, anytime, any place, digital technology has been a gift to consumers. But as they consume media differently, they control the flow of the conversation. That has been a burden to advertisers as the sell-driven, interruption-based model upon which conventional advertising has always relied is increasingly ineffective in this new context.
Online advertising may be semi-nowhere, but that doesn't mean the Digital Age isn't here. All brands are digital, and all marketers are therefore challenged to build their brands with effective digital tools. That calls for practicing the new methods in order to master the nuances of a more mutually respectful two-way exchange with digital consumers. The rewards will be manifested only when deeper insights into consumer needs and behaviors are converted into practical steps that leverage technologies to build a meaningful interaction with them.