Posted by: singularlogic | May 7, 2009

Advertising Revolution or Evolution? You Decide

by Todd Frostad

As the first employee of Digital River back in 1991 , I can say I’ve experienced a technology revolution. Being at the dawn of consumer-driven and technology-supplied ecommerce was an exciting time. The issues addressed then were: efficiency, consumer choice of buying products and services online, and the potential of increasing revenues.

That sounds similar to where the state of advertising and consumer content selection is today. The industry is in a state of transformation brought about by dramatic changes in technology, the economy, and consumer desires. Similar to the acceptance of ecommerce, the providers of products (in today’s market it’s content) need to become more profitable, while consumers want more choice, more skin in the game. Both see the current model of 30 second interruption information that may or may not be viewed by an interested party as inefficient and outdated, a prime example of ineffective 20th century advertising.

I suggest that while it may seem like the concept of consumers selecting their advertising content may seem revolutionary to some, it was no different than accepting the fact that consumers would eventually do their holiday shopping without walking into a store. Yet 15 years after I was building ecommerce models for Digital River, the idea of buying online is commonplace place. Just last holiday season alone $25.5 billion in transactions were completed online.

Today content providers have an urgent need to find greater value to give advertisers to either become more profitable, or in some cases, to merely stay alive. Consumers have a growing frustration with an advertising model that does not address their needs in the same way they have by selecting the content they value. Advertisers, for generations, have invested in complex models and algorithms to refine their targeting.
All these things are an evolution in the discipline of advertising. Which is why advertising blogger and practitioner Dan Goldgeier’s article in Adpulp is on the mark.

Goldgeier is not one to mince words, (ROI Advertising’s Dirty Four Letter Word insert article) or (The Advertising Industry Stimulus Package) so I welcome his raising the discussion of “Ads by Choice,” and enjoyed our conversation at the National Association of Broadcasters show in April.

The question: if not consumer-selected advertising, what will address the urgent needs of an inefficient system of communicating with consumers to fulfill a purchase? I mean, that’s what advertising is supposed to be, right?

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