We in the media industry are infatuated with the new.
… New media, new technologies, new start-ups, new devices, new apps … In fact, being labeled traditional is the kiss of death for any medium.
How ironic, then, that when it comes to pitching for advertising dollars, being somewhat old-school appears to be the formula to win over marketers budgets.
Early on in the days of the web we marveled at the precision of the Internet. The opportunity to target audiences beyond demographics to individual behavior profiles and the ability to track and measure all the way to a sale opened up our eyes. So it surprised me when the Interactive Advertising Bureau and others launched initiatives to get the digital media industry to adopt old-media concepts like ratings and reach. It kind of feels to me like a dumbing down of online advertising's offering. Yet, its par for the course. The hottest digital ad mediums are adaptations from old media.
What's the fastest growing medium in digital at the moment? Online video … or basically TV commercials interrupting other content being sold on a CPM (cost per thousand) basis. That's essentially the medium we have been buying since the days when Don Draper was sketching out story boards.
Tim Westergren founder of online music service Pandora was in our agency a couple of weeks back. His pitch to me was that they were just selling radio. Indeed, Mr. Westergren said recently he doesn't expect to reap major brand dollars until Pandora is measured on the same currency as radio.
Example after example, we see that today's digital new media clamoring to sell us very traditional advertising solutions.
But it doesn't stop with traditional digital media. Social media powerhouse Facebook sees its financial future in selling display advertising space -- a decidedly traditional online advertising model.
And the best ad model on iPads are full screen print or video ads interspersed in editorial, a twist on what magazines have been doing for more than 100 years.
So what does this tell us?
- That despite all the bravado of the new media world that was going to disrupt and disintermediate the traditional media model, all it's done is reinforce it.
- From what we're seeing, any media company that doesn't have a scalable advertiser funded proposition really doesn't have a sustainable business model. Media buyers have always known that a lot of eyeballs or uniques isn't worth much unless it has a clear solution to monetize it.
- Even in this ever social media world of participation and personalization, audiences, particularly engaged ones (or even interrupted ones) at scale remain valuable for marketers to help them build brands. Conversely, innovative technologies that talk to niche audiences will find a place, but will struggle to get substantial budgets or advertiser attention. Note: there will always be some exceptions to this rule, but the odds aren't great.
- That the clout of the big media buying agencies continues to be important and enduring. In other words, the upstart media players of the digital age, haven't disrupted the establishment, so much as they've just joined it.