Mark Suster posted a relatively important piece on the future of advertising on TechCrunch over the weekend which you can now find posted on his blog.
I say relatively important because when VC’s like Mark Suster, Fred Wilson and Jeremy Liew go public with their ideas on the state of play of advertising online it provides us with some measure of where the thinking of “Silly Alley” is at in relation to what “Mad Ave” is now thinking.
Suster’s presentation read pretty much summed up where Mad Ave was in late 2000. All the elements were there Banner Blindness, The collapse in Display CTR in 2000, poor brand recall. By and large Mad Ave didn’t bother coming back for another go at the online experiment but for those who did the thinking has pretty much focused on direct response while continuing to experiment with ways to improve audience engagement by invoking the crowdsong (i.e Celebrity Endorsements) and adopting in-content Product Placement.
What was missing from Suster’s post was the key ideas of the move from the offline “Browse with us, Buy from them” to the” See it ,click it, buy it” reality of the “Browse with us, Buy from us” model online and that the key to success with any medium is to discover what people are doing with the medium and they do it better.
Other ideas he may have touched on include the often overlooked fact in online advertising circles that although under utilised traditional advertising still provides a better ROI for driving online eRetail than the online alternatives (i.e. Search and Display) and that growth in the rest of online advertising industry has pretty much flat lined since Google’s IPO.
Of course the one key ingredient missing from the post was the looming impact of the Mobile Phone on the advertising industry and online advertising in particular.
Moving forward there is the growing interest in social media and the idea that online at least relationships are probably a more important communications platform than content.
At the end of the day though advertising faces the same challenges online as media and, as we have discovered before, this means trying to discover where meaning resides in the network.
I say that because the global network of databases that is the web today has effectively rendering content meaningless and for all intents and purposes worthless (i.e. Free). The question advertisers need to address is do they want to be associated with something that is meaningless and worthless or do they want to be associated with something that is meaningful and valuable.
It is a simple but silly question because the answer is self-evident. The challenge is to discover what provides meaning to the network and then become associated with that.
So let’s try to establish what provides meaning to the network.
Today the common perception is it is relationships. That’s what makes Social Media [So.Me] so hot at the moment.
Advertising attaches itself to the relationship and by association advertising now has meaning on the web right? Maybe, maybe not.
What happens if the global network of databases renders relationships meaningless just like it has done with content? After all on the web followers and the following just become tables in a database. Their relative value is no better than content.
So let’s step back from the So.Me frenzy for a moment and avert our eyes just long enough to look elsewhere.
Let’s take another quick look at the node, the gadget that connects us to the network.
What the Japanese knew intuitively a decade ago. What Apple discovered in 2007. What Nokia has forgotten in recent years. What Google, Microsoft, Murdoch and yes, even Facebook, have yet to comprehend. Is it isn’t media. No it isn’t even relationships. And it’s certainly not the data. It’s the gadgets we use to connect with the network that ultimately gives the network it meaning.
How do we know this? Simply because the gadget is the main thing people are willing to pay good money in the efforts to get connect to the net. It is as I have said before the sweet spot in the MobCon value chain.
We also discovered some time back that the mobile phone is more fashion accessory than media platform.
The reality is the mobile phone business was always about walking into a crowded room and saying: If you think that’s cool then take a look at this!
Of course the problem for advertisers they cannot be the fashion accessory. Perhaps they can give away branded phone covers but they cannot afford to hand out branded iPhones and Android Handsets. For those who don’t like thinking too hard the simple answer to the mobile challenge is to repeat history and give away Free Apps, create a mobile web site and start buying mobile advertising.
The problem with this strategy of course is you quickly become just another App in an ecosystem awash with freebies, your mobile web site becomes just another billboard in the desert and the audience quickly become banner blind your mobile ads.
History repeats itself and the advertising you broadcast across the network once again proves to be both meaningless and irrelevant to the audience.
So assuming advertisers are not looking to achieve the same endgame with mobile what is so radically different this time round that it will allow advertisers to change the game?
Obviously the key difference between the desktop web and the mobile web is location… or more accurately mobility.
If advertisers choose to play the game from within the confines of the network they will buy into the “Silly Alley” pitch of location-based target marketing. You known the pitch. If the target is within 2 blocks of the store send them a discount voucher on their smartphone and invite them to save some money.
Nice idea so long as the target isn’t spooked by the fact you are in the business of “Stalking them for trade”.
Now let’s take a look at what happens if you choose to opt out of the network. Let’s think what happens if you choose to be the game rather than just playing the game.
The key to success in this approach is to make the real world the game platform by providing the target audience with the clues and prompts in the world around them so they can use their mobile handset to discover you and your brand.
In the process turning the “sledgehammer” of location-based target marketing into a highly personalised game of seduction and Brand romance.
The things that make the difference between your brand becoming little more than a discount coupon and a lovemark.
Watching TV? respond with your phone. Walking past a bus, a taxi or a billboard? respond with your phone. Listening to the radio, reading a magazine. respond with your phone. Shopping in a competitor’s store. Request a price with the phone. Shopping in-store, buy with your phone… The smartphone is much more than the 7th Screen. It is the new plastic.
Your task as an advertiser is to make it truly fantastic.
This then is the opportunity for the advertiser. Not to make the mistake of once again becoming lost and irrelevant in the meaningless network but to provide meaning to the network by providing the audience with a magical mystery tour of activities, attractions, events and happenings that they can connect with and capture on daily basis with their hand-held digital nests and broadcast across the wireless network to their friends and influencers.
Yes folks it’s a chance for Mad Ave to go back to the future.
Thanks to the new plastic fantastic advertising can be fun again. You just have to have enough imagination to make it so exciting your customers can’t get enough of it.
Best of luck…