Where’s the digital dividend? Show me the $$$…

Banner blindness or banner blocking are terms given to the action of humans when they ignore advertisements on websites. We actively ignore the advertisements to focus on the articles, or videos.

I suppose it’s much like those readers of Playboy and Penthouse magazines who only read them for the articles and ignor the rest of the ‘content’. Or it’s like the male of the species when watching television. What does every male in the world hold in his hand when sitting in front of the TV (apart from beer)?

That’s right, it’s almost part of his DNA – the remote control. And the moment an advertisement appears, he quickly changes channels so he can watch at least 3 other shows at once. He rarely views an ad.

males watch tv

The interweb and offline media are two quite different beasts when it comes to advertising space. There are a limited number of television channels and radio stations for example. And these can only broadcast for 24 hours a day. This means there is a limit to the number of advertising spots available. As you know, the number of people watching television and listening to radio has declined as more options have become available with digital technologies.

By contrast, the interweb’s advertising spots are growing exponentially every day, as more and more sites and pages are loaded – all dependent on the lifeblood of advertising dollars for survival.

It’s a fascinating paradox that the interweb has allowed so many to create ‘businesses’ but these businesses are not creating things for which consumers will pay money. Rather these businesses can only survive if advertisers fund them. Imagine if all that initiative had been used for the collective good of mankind, creating things people wanted to pay money to use?

But I digress.

In an interesting opinion piece in Reuters recently, Felix Salmon quoted Todd Juenger. Here’s a part of it:

Just because there is a large and growing supply of Internet inventory doesn’t mean advertisers have a correspondingly large desire to deliver more Internet impressions.” Indeed, as the price of online inventory continues to fall, it seems just as likely that online ad spend will go down (because the ads being bought are getting cheaper) as that it will go up.

This is the problem for online ‘publishers’. They need advertising revenue to survive, as there are too few people willing to pay for online ‘content’. And advertisers only have limited budgets themselves – and they’re not growing at the same pace that online “advertising opportunities” are appearing. So there are not enough advertising dollars to fund all the pages being created. It’s simple maths.

And then there’s the problem for marketers and business owners – where do they invest their marketing budget on the interweb?

But wait, you can stop worrying – it’s not a problem at all. I can reveal to you that the interweb is the easiest place in the world to advertise. That’s because on the interweb you can predict the future.

You can predict the future on the interweb
You can predict the future on the interweb

That’s right – everything you do online is measurable, so you can test your executions before investing your marketing budget. This allows you to determine how your messages will perform and what your results will be. And you can test and roll-out in a matter of hours.

I’ve done tests with email and online ads where the open and click-through rates varied by a couple of hundred percent between versions. And split-run tests on landing pages that have reduced the cost of acquisition to less than 20% of the pre-test costs.

Wouldn’t you like to know which of your ads worked so you could maximise your income?

I assume you’re now asking yourself something like: If we can test and predict the future so easily, and if the data analytics are available to all who advertise or conduct email campaigns, and we can therefore determine what works and what doesn’t; “why aren’t we reducing our marketing budgets to get the same results as previous campaigns, or getting better results from the same budget???

Where’s the digital dividend???

Where are the savings in our marketing budgets, or the increased profits or market share? How come our online advertising isn’t getting better results? It’s predicted this year in Australia over $2 Billion will be spent on advertising on the interweb – and that doesn’t include email marketing.

With such an investment of digital dollars, why aren’t we seeing massive market share swings or outstanding results never witnessed before – thanks to the analytics and testing? Why aren’t marketers getting better results for their shareholders?

One of the reasons is that alleged ‘digi-experts’ don’t really have the skills necessary to create advertising for the interweb. Another is that we are ignoring the analytics – BIG Data is a Big Pain. But the main reason can be found in the popular book by Charles Mackay, first published in 1841: The Extraordinary Popular Delusions and the Madness of Crowds. It appears we are more intent on following than questioning.

herd of sheep

The interweb offers marketers the easiest way ever to get the best results possible from their marketing budget. Yet it appears very few care about doing so – they care more about spending a marketing budget, than spending it wisely.

But hey, in most cases it’s not their money, it’s their shareholders, so why am I concerned? Hang on, I’m a shareholder…

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