Still Want to Buy a Banner Ad?

26 Sep

banner ads are broken

 

Much has been written about the unprecedented rate of growth in digital media spending by advertisers.  But it pays to restate a few facts to help provide some context for this article: 

  • Digital ad spending will hit $140 billion in 2014
  • Compound annual growth for digital spending will average 16% through 2018
  • The compound annual growth rate for total media spend will be 5% through 2018
  • Digital media will account for 1 of every 3 dollars spent on advertising in 2018 

(Source: Ybrant Digital, soon to be re-branded as Lycos, September, 2014) 

What is amazing is that this growth is being achieved in spite of serious questions about the efficacy of certain digital media formats and continued concern regarding the level of fraudulent activity, which continues unabated.  In a recent article for Digiday entitled; “Why digital ads are broken beyond repair” Faris Yakob provides some disheartening evidence that is sure to provide pause to some advertisers.  

According to Mr. Yakob, banner ads, which rank among the oldest and most popular types of digital media in use with “more than 5 trillion banner ads served in the U.S. in 2012” may not warrant the share of advertiser spending which they presently command.  Why?  The author points out that according to a 2009 comScore study “85% of all clicks are derived from 8% of users.” Further, he cites Interactive Advertising Bureau estimates which suggest that “36% of all web traffic is considered fake” to support his supposition that from a media perspective banners are broken.” 

The question raised by the repeated challenges and allegations being leveled at digital media is a simple one; “When are advertisers, publishers, ad agencies, technology intermediaries and industry associations going to get serious about reforming this media channel?”  

Sadly, the answer may be “never” or at least, not as long as advertiser investment in digital media continues to outpace that of traditional media by a rate of three to one.  After all, why should the industry invest in expensive, time extensive and complex reforms when the absence of any such performance governors has not limited the flow of ad dollars into digital media? 

We’re all familiar with the popular quote by 19th century merchant John Wanamaker: 

“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” 

Given his perspective on marketing efficiency, there is little doubt that Mr. Wanamaker would be a supporter of the proposed move to a viewable impression standard.  If adopted, this new audience delivery currency would serve to counterbalance some of the issues related to click quality and fraudulent activity.  While more needs to be done to protect the interests of advertisers and publishers alike, this would be a positive first step toward reform. 

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: