Problematic Programmatic

The relationship between advertising and technology has always been  a tenuous one. The two have gone hand in hand since the invention of the printing press, but its always been an odd partnership, both symbiotic and dysfunctional at the same time. And now, well into the 21st century it has become only more so.  Advertising relies on “communication” to identify, influence and even coerce the human psyche to buy, or not buy, material and spiritual goods, relying on eye catching visuals, comforting stories and catchy ideas. Technology provides the “media” to bring those visuals, stories and ideas to the sometimes willing, sometimes reluctant masses. In advertising you can never have enough eyeballs. However, it appears technology advances faster than marketing ideas…sometimes too fast.

As we’ve progressed from graffiti to newspapers to radio to television to the internet, the idea has always been the same…the more eyeballs the better. But all the way to the internet the medium was only
the conveyer of the message, a message that usually stood separate in and of itself. Before the internet, media was passive. The masses read, listened, or watched, whatever,  and what they did then was unpredictable and random. The goal of the advertiser was only to deliver the message, after that it was up to the advertising gods and human nature to determine the actions of the individuals that consumed the message. But with the rise of the internet came a breakthrough in advertising science…the Banner Ad!

Its been 20 years since the invention of the banner ad, proudly displayed  by the then innovative AOL. The idea being that with this new, more personal media that could not only reach the masses but now can actually capture their responses, reactions or revulsion, the Rubicon had been crossed. Advertising has been in the “digital” age ever since.  Don’t scoff, the original banner ad had a whopping 44% click through rate, meaning that a little less than half the people that saw it on their computer clicked on it. Usually just out of sheer curiosity. 20 years  later a click through rate of  1.5% is considered successful. Why?

Well like any new found power, the last 20 years has been spent on squeezing as much juice out of the advertising banner ad as humanly possible. The banner ad has infiltrated and dominated internet advertising ever since. Advertisers love anything that can be measured, quantified and packaged in the never ending search for ROI. And why not, if I spend a million dollars on an ad campaign its only fair to assume I should get at least a million and one in return. Why else spend the million in the first place?

Of course, in the real world, its never been that easy. When the first graffiti artist wrote “eruntque comedantes in Joe scriptor” (Eat at Joe’s) on the collosseum wall, he didn’t know exactly how many people would see it, he only knew that a lot more would see it if he hadn’t written it there at all.  And if that meant that just one more person showed up at Joe’s because they did read it, then the “ad” could be considered a success compared to the cost, the time it took to write it.

To some degree, up until 1994 that was the general business model of all advertising, everywhere. But now that we’re in the “digital” age, advertisers want to know exactly who did what and where. Its not important that consumers hate banner ads, its important that the 1.5% that don’t hate them can be measured, quantified and packaged. In short, the power of the number is seen as more powerful than the creative idea. I guess… after all it was someones idea to write “Eat at Joe’s” in the first place, but probably not to sit and watch to see how many people read it and how many people actually showed up at Joe’s because of it. That would come later with the invention of the coupon, but that’s another story.

This brings us back to technology. The medium of the internet is no longer passive, but “interactive” . The user can now interact with the advert directly and on the spot. Unfortunately over the last 20 years this seems to have become more important than whether the user wants to or not. Mind you as banner ads have evolved, they have striven to become more informative, more entertaining, more captivating but lets face it, in your average perusal of the internet in general how many banners ads do you click on?

Granted the first 10 years or so of internet advertising was more novelty than science, but as the internet grew with the wider availability of broadband, things started getting serious. More advertisers started diverting more of their advertising budgets to digital advertising as opposed to traditional, print and television,  once again chasing those ever increasing numbers. The more eyeballs the better. But this posed a dilemma in determining if all these electronic ads were having any positive effect on all those eyeballs. What was more important, how many people saw the ad (impressions) or how many people “clicked” on it, (CTR, CPM…anything with a “C” in front of it).

The debate was just heating up when Google unleashed “targeted” advertising on the world. Now instead of just flashing as many ads as possible in front of as many eyeballs as possible, specific ads can be shown to specific eyeballs that are much more inclined to respond to those ads. Mind you, this sometimes meant less eyeballs but if it meant more identifiable responses than obviously thats a good thing, right? Well, whether it is or not, Google, a simple technology company whose core business had been providing a search engine that people could use to sift through the infinite volumes of information available on the internet, becomes an advertising power house practically over night! Billions of dollars pour into the technology cupboard and a new science is born…targeted advertising.

In reality targeted advertising is nothing new. Its why you see all those beer commercials during football games, hyundai commercials during the Big Bang Theory and finance commercials during 60 minutes. The only difference is that in television-land the targets are much, much bigger. But there’s the catch. In internet advertising who sets the targets? How big or small should those targets be? How do you target consumers without “creeping” them out with Minority Report intrusion? The rise of digital only advertising has had some measurable success but even these employ the black art of “creativity” to create campaigns, some successful, some not.

The answer? Lets dispense with the creativity and leave it all to science…the rise of Programmatic. What is programmatic advertising? I recently did a search on the Flash ( the superhero, not the software) television series on Amazon VOD. The next time I opened up my facebook page, there was an ad to buy the Flash series on VOD. Why? How?  Because a programmatic ad server matched an advertiser’s ad, whoever is selling the Flash DVD, with an ad publisher, Facebook. Who knows how? But I wasn’t creeped out or alarmed. In fact, I was mildly amused.  It could be creepy that my interests follow me around on the Net but I did like the fact that at least it displayed something I was genuinely interested in. It was not the first programmatic ad I have seen, but its the first one that I actually liked.  It would have a much greater impact, however, if it had appeared on the Amazon site when I really was interested in the topic. But the trend is clear. The technology is there and even though no one quite understands it, including me and I’m in the business, its here to stay.