For the past six months, report after report has chronicled that online advertising just is not "working," despite increased spending. To quote Internet Advertising Bureau Chairman Rich LeFurgy: "We still have a ways to go."
Combined, these reports suggest something larger than the inefficiency of online advertising. Read together, they imply that right now, with today's consumers, advertising anywhere is ineffective.
The Web just offers the first clean, uncontaminated sign. It is after all the first medium capable of recording what consumers are actually doing when we think they are watching advertising. Consumers have always had the choice not to respond to advertising; there's just never been such damning evidence of exactly what they were choosing.
So it shouldn't be surprising the metrics used to buy offline advertising fail so miserably online or that we need to rethink our formulas if we are going to use this medium to build relationships with consumers.
"Reach" is defined as the number of targeted consumers touched by the selected media vehicle. A media plan's total reach can be calculated by combining the reach of all vehicles in a plan, whatever the media.
Reach created value for advertising because it enabled us all to make the leap of faith that every magazine subscriber or TV viewer read or positively responded to our ad and then was magically transformed into a buyer.
Ancillary metrics, such as Roper Starch Reports, helped sustain our faith. But the Starch Reports' rankings of print ads against each other instead of against the reality of a reader's actual behavior just kept us doing a more modern version of that angel-counting thing, albeit on a very large, expensive pinhead.
Broadcast media, with their huge budgets, required equally immense illusions. Weren't we just pretending we'd never run to the kitchen during the commercials? But the Nielsen ratings gave us seemingly irrefutable permission to discount our own experience. We were rapt the first time our client's new spot was broadcast, or when a competitive brand's spot first aired; but how many times did our own behavior change due to advertising? Or, more accurately put, just because of advertising. That was the claim we made to our clients.
The Internet cuts through these intricate delusional structures to pure behavior. (B.F. Skinner is smiling somewhere.) Banners are placed across multiple Web sites, each audited and delivering the defined target. A reach number is calculated. CPMs are multiplied and paid.
And no one clicks.
First, the size, number per page and placement of the banner was blamed. Animation helped grab clicks for a while. Then that faded. Adding "click here" and the ubiquitous "free" lifted rates; then they fell again. The unit is ineffective. It's not intrusive enough. Or maybe too intrusive.
Rich media comes to the rescue; but still the actual activity is below the media planners' prediction. Then the whole concept of online advertising is questioned.
The arguments now focus on the branding value of online advertising. But the weight of behavior overwhelms claims that banners influence attitude. Maybe they do. But the argument finally must come back to the reason marketers advertise: Does online advertising, in the form of banners or anything else, drive sales? A more refined concept of reach won't solve that puzzle.
Frequency is an even more suspect proposition online. The theory behind frequency is that the average advertising viewer needs a minimum of three exposures to a message to get it. This idea supported investing in campaigns, using the same creative unit over and over again and buying the same media vehicles repeatedly.
There were a lot of reasons why adhering to the frequency gospel was good for agencies and media companies alike. And, while plenty of agency folks produced reports on "wear-out," for TV commercials it was notoriously difficult to prove. (There was no one there to hear the screaming at the 22nd exposure to the same car commercial.) Not so on the Internet. Wear-out is almost immediate. The decreases in click-through on a run-of-site buy are perceptible in a matter of days. Frequency is valueless.
Whether consumers are worn out with advertising or advertising has worn itself out is immaterial. It is vital to completely rethink how to engage consumers and brands in mutually rewarding relationships. And the Web will not only be a vital medium for that relationship but also keep us honest-proving or disproving our theories in real time. So much for the years of eyes wide shut.
Ms. Sharpe is founder and partner, Sharpe Partners, New York, a Web marketing agency. She is former director of interactive marketing, DDB Worldwide, New