A Broken Model

For the vast majority of sites that advertise, there is little to no communication between site and advertiser. The relationship (or lack thereof) is entirely money-driven – the site gets money for clicks and the product/service being advertised gets traffic (and hopefully) revenue. In many cases, advertising works through third parties such as Google Adsense. The site creator and the advertiser do not know (or care) one bit about the other. In this model, advertisers think that the real estate and traffic of a site are its most valuable resources. Advertisers are only going to be willing to pay for what they consider valuable. Due to this perception, many advertisers expect that they receive prime real estate for their banners, links, etc. Advertisers rarely consider how this may impact user experience or the loyalty of a site’s audience. What should the advertiser care, they know nothing about the site to begin with. This revenue-centered model reminds me of the old method of clear-cutting forests. The lumber companies would come in, take all that is valuable, and leave once the land had nothing else to give.

Honestly, how does an ad like this help anyone?.

What is deemed a success in advertising needs a major overhaul. Currently, most advertisers are only willing to pay for a click-through – some are only willing to pay if a specific ad click generates a sale. Ironically, this model only exists on the internet due to its unique ability to track various forms of data. If a company purchases ad space in a newspaper, that company has little to no way of tracking revenue generated directly through that ad. Comparisons can be made from sales before and after an ad campaign, however that still can not directly track one ad’s success. Advertisers are willing to pay through the nose for TV ads, with no concrete guarantee of financial gain. In addition, there is no statistical data to track the percentage of users turned off from both the advertiser’s product and the site which the ad sat on due to its invasive nature. There also are no numbers to determine the negative impact invasive ads are making on a brand. Why is there such a discrepancy between online and offline advertisements?

Put Less Money in the Equation

Money is the root of all evil, even on the web. An advertising model that is solely monetary can bring out the worst in both sides. If advertising is strictly a means to generating short-term revenue, the advertiser could care less about the impact an ad is making on their brand or the brand of the site advertising for them and the site creator could care less about its audience. Advertising is more than just click-throughs and cost-per-clicks. Are a few thousand clicks worth the possible negative impact an invasive ad leaves on both parties? This pressure for return lies directly in the investment made. If less money changes hands (on both sides) this desire for return by any means necessary could potentially be blunted. With asking for less money, site creators could demand more user-friendly ads in both content and appearance. For advertisers, if less money is asked for ad space, they should be much more welcome to less invasive tactics to promote their company/product. With money being less of an issue, community reputation and a genuine desire to work together are a much higher priority for both sides. Both advertisers and site creators should be just as interested in the ad’s impact on their reputation as they are in their bottom line. Just because someone clicked on an ad does not mean it was successful. The motive of clicking should be a much higher priority.

Many advertisers consider a site’s real-estate its most valuable resource – this is becoming less and less true with the evolution of the web. Today, a site’s content and the trust of its audience are the most important resource. Traditional online advertising strip-mines the trust of the audience where greater short-term gains are made at the expense of long-term longevity. With no mutual interest, this type of model seems completely acceptable – that is exactly why it cannot work. As brought up in the previous article, this type of advertising is may have a lot to do with drops in traffic.

No one knows a site’s community like the site’s creator and the actual community itself. Using that model, it seems somewhat ridiculous that advertisers expect good results with putting their generic ads into a site and then expecting the ads to just work. Every web community has its own nuances and personality – ads that work great for site X, could very well fail horribly on site Y. It makes more sense to, at the very least, get know the community before beginning to advertise for them. Much better, advertisers work with the site creator to interact directly with the community – not a company/consumer interaction, but as two communities with similar interests. In addition, instead of insisting on a traditional advertising relationship, a more tailor-made sponsorship could be created to allow site-creators to advertise a product through the lens of the community. Of course, this depends on the site-creators’ willingness to work with advertisers and vice-versa, but there is a very good chance that the product will be much more well-received if the site-creator is endorsing it rather than XYZ Corp shoving it down the audience’s throat.

I definitely understand the concept of advertising across the broadest segment of the population. There definitely are valid reasons for casting a wide net – the only problem is that many times those advertisements are being served to large segments of people who are not the target audience. This wide net can be quite wasteful both in time and money. For many companies/organizations with small to medium ad budgets, that time and money would be spent more wisely with focused ads to a few quality sites than a more vague ad campaign created to work across many more sites. This strategy fits in with creating personal relationships with site creators. If companies are more interested in advertising across only a handful of sites, the incentive to work very closely with those sites increases. The potential collaboration between advertiser and site creator is where special thing can begin to happen.

‘Ads’ as Worthwhile Content

In my opinion, banner ads are becoming less useful by the minute. Granted, I currently have something similar to a banner on this site, but its future is in great peril. Its lack of usefulness will be its demise as it does absolutely nothing for returning users. I would like to think that I would continue to support TerraPass, but it would take the form of something more useful for the audience. Ads do not need to be “sacrificed space”, they can be substantiative writing, content and media or co-sponsored projects undertaken with support of the advertiser. Just for this site, I can think of many companies/organizations where some sustainable ad model would not just compliment the site’s content, but add to it. People make the idea of throwing ads on your site that are relevant to its content seem revolutionary when in reality it is nothing more than common sense. Revolutionary begins when ads/sponsorships begin to improve a site’s experience. As much as it may seem, this is not a pie-in-the-sky idea. Bloggers could work with a sponsor to have co-created content that neither could produce alone. Companies/organizations could have invaluable expertise on a certain subject that could be published through a site creator’s site/blog. Honestly, there are infinite possibilities and services that could develop in the future. For example, ReviewMe is proof that this kind of relationship between the advertiser and site creator is starting to be occur. My hope is that this model will go one step further – with less dependence on a third party to facilitate very temporary ad partnerships. Just like a site’s content, sponsorships should be relatively consistent.

Content created by advertisers has the potential to be taken much more seriously than just your average banner ad. This method could very easily be considered deceptive at best if done the wrong way. However, if the site creator and advertiser are candid about the relationship and the content is genuine, this model can be used to provide valuable and unique content for the audience. Methods such as this rely on a advertiser/content-creator relationship built on something more than just financial transactions. I would love to have design firms write about sustainable design or a hosting company post an article on this site about how they are working to run on clean energy. My expertise in these areas is slim to none, but a common interest in such topics can open up the door for an interesting symbiosis.

A Sustainable Approach

This advertising approach relies on both advertisers and site creators to think about advertising and revenue in a more sustainable manner. Advertising needs to be seen as a partnership where both parties will reap less benefits unless both are equally committed to make it work for each other. In addition, both parties need to come up with a more creative method of compensation. Money alone will not only create the potential for conflict, but ultimately it is just one piece of what is desired. The long-term results of reputation-building and user-first advertising will pay dividends to everyone – it just may not show up instantly. In the end, site creators and advertisers have a common goal – to engage and communicate with the user. That desire for mutually beneficial engagement and communication needs to take a higher priority than sales via ads or ad revenue.

Come back in the next few weeks for the last article in this series on online advertising.

With a few small websites, a couple flash drives containing MP3 files, and a whole boat-load of creativity, this viral campaign has caught fire – with three articles hitting the front page of Digg and tons of buzz generated elsewhere (online and offline). The Year Zero viral campaign has definitely succeeded and continues to draw attention much longer than the usual “marketing spikes” do. From my view, this is a major score for the media 2.0 corner. With the media/advertising blitz of the Super Bowl still resonating I thought it would be interesting to see how the marketing campaigns of media 1.0′s Goliath compared to the Nine Inch Nails viral project.

Below are Alexa’s traffic results for NIN.com versus four companies that advertised during the Super Bowl:

The NIN viral campaign beats all of them out and seems to have greater staying power than all four of the competitors as well. I am well aware that, to a certain extent, this is comparing apples to oranges. Most of these companies do not rely heavily on their website for success and their ads were offline to begin with. It is asking a lot of an individual to go to a website through a TV ad – no doubt about it. All that being said, I would expect a lot if I spent $2.5 million for 30 seconds or airtime. As can be seen from the chart above, just like those 30 seconds, the public’s attention came and went very quickly. Unlike a 30 second ad, an online presence is always available and can be constantly updated.

I thought it would only be fair to throw a dot-com into the equation:

As for a dot-com versus dot-com comparison, SalesGenie.com spent $3.7 million for their Super Bowl advertisements and obviously got a big spike. However, from the diagram below, that spike did not last too long and it appears as though the NIN campaign could pass it up in the next few days. It really does beg the question if a couple of 30 second spots will continue to make sense versus a creative, sustained and continually evolving bridge between the advertiser and its target audience.

With the net generation watching less TV, will these ridiculously expensive ads finally be seen for what they really are – ridiculous? We are just seeing the tip of the iceberg when it comes to full-fledged creative online marketing campaigns. I have no illusions that many will be as fun and generous as the NIN campaign, but these sorts of results from a very off-mainstream viral theme for a relatively niche band is pretty amazing. I personally have found this entire sequence of events absolutely fascinating and makes me very excited to see how things will continue into the future.