There is no doubt that the coming of online advertising has changed everything. OK so it hasn\u2019t turned out to be the panacea that some zealots thought (some still think) it might be; and no we haven\u2019t yet properly worked out how commercial communications can work best within social media channels; but those bumps in the road don\u2019t change the underlying fact that things are very different now.<\/p>\n
When technology first met advertising the resultant conversation was a dialogue of the deaf. The truth is that traditional advertising people didn\u2019t really understand all that much about how the technology worked, and thus what it could do for them, whilst the technologists understood little about advertising beyond it being the source of the cash and thus a necessary evil to be humoured and tolerated.<\/p>\n
The media agencies more than most did listen and did understand. Good for them \u2013 they certainly grasped how the technology could be used to benefit them and their clients, and thousands of theoretically strong plans were written reaching loads of people gazillions of times for pence. The problem has been that when the media plan is so far in front of the creative idea the final output can be a great plan with a poor creative execution.<\/p>\n
Then there\u2019s the infrastructure. Where\u2019s there\u2019s chaos there\u2019s margin. There have been too many middle-men doing too many over-complicated things and charging way too much for them. Eventually something had to give; some shake-down has always been inevitable.<\/p>\n
It seems the mists are starting to clear, even if just a little. Early adopters within marketing have realised that they can use online activities for more than direct response; suppliers have worked out that any realistic future must include display advertising from the largest players. Some of the early DR-like metrics \u2013 like click-through rates \u2013 have as a consequence been overtaken by measures of far greater relevance to large advertisers.<\/p>\n
The next stage is to tidy up the supply chain. At the moment this is less a chain and more a maze. There are so many steps between publisher and advertiser that both data and value leaks away as the maze is negotiated. One large publisher has estimated that once you factor in fraud and lack of viewability on top of the so-called technology tax what\u2019s left of the advertiser\u2019s online budget for the publisher is in the single-digit percents. This chimes with Kraft\u2019s statement<\/a> that it \u2018rejects\u2019 up to 85% of online advertising placed on the Company\u2019s behalf.<\/p>\n Value leakage is a well-recognised phenomenon, data leakage perhaps less so but none the less serious for that. Publishers own a great deal of data of value to advertisers. If publishers\u2019 data is leaked at various stages along the maze, as it is (for example) aggregated then properties lose value.<\/p>\n