Stream On.

by Doug Weaver on February 26, 2014 at 8:02AM

Stream OnIn late 1995, Yahoo! had just been born and mobile phones had recently shed their pull out antennas.  I’d been selling digital ads for just over a year at that point and was being courted by a small MIT Media Lab spinoff called Firefly, which I would ultimately join.  Part of the wooing process included several trips to The Lab, where I’d meet with amazing scientists and brilliant, entrepreneurial grad students.  I knew they were amazing and brilliant because I understood about every third sentence.

But there was one project that stuck with me over the past 19 years, even though I’ve long forgotten the identity of its developer.  I recall sitting in a small windowless office peering into a large monitor, which reminded me of the view from the bridge of the Starship Enterprise.  I had the distinct feeling of hurtling through a galaxy as stars and planets flew past to my left and right.  Only they weren’t planets and stars:  they were words, phrases, images and brief bits of rudimentary video.  This, I was told, would be the future of the web interface; the way we would navigate information someday in the future.  A perpetual feed would wash over us and we’d simply grab, sort, file, save and view what interested us with the clicks of a mouse.

This week’s Drift is proudly underwritten by PubMatic, the technology platform that powers the programmatic advertising strategy of leading publishers and premium brands. Our innovative solutions help content providers drive the highest value for their digital media assets and provide consumers with a more personalized advertising experience across display, mobile, and video.

Keep in mind that the web had just been invented less than four years earlier, Google was still a nascent grad school project and Mark Zuckerberg was 11, so this was pretty heady sci-fi stuff.  But after nearly 19 years of clicking from page to page to page, it seems like perhaps we’re finally coming around to the vision of that anonymous MIT researcher.  And I think it’s happening because of the convergence of behavior and interface design.

Let’s start with the fact that 2014 the watershed year where far more web access comes from mobile devices, specifically those new-fangled, antenna-less smart phones.  Page after page after page just doesn’t work for the mobile viewer, and mobile interface design is quickly becoming the default.  That means a consumer who’s coming of age today will expect all of his web access to mimic his mobile experience.  Enter “Responsive Page Design,” the new school of UI design that presents the desktop web in a long continuous stream of consciousness.  (Early examples include sites like ESPN, Quartz and Yahoo! Food.)  We’re still not on the bridge of the Enterprise, but we’re getting there.

The question – and the point of this post – is what this all means to the currency of the display web ad business?  For two decades we’ve built our financial assumptions on top of lots of clicks generating lots of pages generating lots of ad calls generating lots of revenue.   Now, with the consumer enjoying elegant, streaming design and rolling over and expanding what she wants to view when she wants to view it, what will we count?  It may seem like an academic exercise today, but it becomes a vital economic question very quickly.

Reader Comments (4)

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  1. Mark McLaughlin February 26, 2014 at 10:04 am

    I’ll put my stake in the ground.

    Display advertising and paid search will move closer and closer together to form the ultimate solution for direct response advertising. The link of every ad impression to a sale and the kind of tangible ROI that is tracked on a spreadsheet will use this integrated solution as the focal point – all other DR tactics (telemarketing, in-store, coupons, catalogs, direct mail and yellow pages) will evolve around it.

    Brand advertising – the investment in brand equity to improve short term and long term business efficiency – will become a complex integration of social, native and streaming video tactics that align around a focused strategy designed to attract, engage and retain consumers. This will be measured and it will be performance-based but this is a type of marketing ROI where the “R” in ROI is a lot more sophisticated than “cost-per-sale.”

    Of the three tactics for branding, we are getting serious about social, we grasp where we can go with video (although the tip from TV budgets to online video is going to be paced cautiously) and we have only scratched the surface around the concept of “native” where mobile is going to force our hand to become masters of this tactic.

    That vision Doug portrayed of sitting in front of giant screens with 3-D images flying past us and grabbing what we find to be most interesting or relevant – getting into that flow as a brand is what the lowly concept we call “native” will eventually become.

    There was a window of opportunity from 2007 to 2011 where display advertising could have become both. Doug’s key question… “what this all means to the currency of the display web ad business?” is something that we answered for ourselves. We chose “real time bidding” instead of “really engaging ad units” as our overwhelming priority for exploiting the explosion of bandwidth and page views. We followed the easy money and that was smart because the money was both easy and massive.

    The price we paid is that there is no way to put some of the toothpaste back into the tube. The ship has sailed for display advertising. Lowest common denominator banner ads purchased in real time through a bidding process that matches dozens of super-computers against each other is the choice we made. Don’t try to fix it, move past it instead.

  2. Ned Newhouse February 26, 2014 at 11:51 am

    Time on site. The appropriate currency of this newer, new age.

    BTW IMHO Responsive design flies in the face of the worthy and reasonable viewable impression mission. Unless you are going to develop completely different templates for 4″, 7″ and a desktop screen, (which thus defeats the purpose of design once, responsive) jamming all the that desktop content into a smartphone that then becomes a 7ish or more scroll to bottom of the page nightmare. Instead of being mobile first or desktop first. I think the best future is “user device first”, creating customized versions of your websites for that screen size and uses the scrolling or swiping functionality innate to that device. That is the best way to be “brand everywhere” for whatever device they choose to view you on. That is the key to brand loyalty and inevitable advertiser satisfaction.

  3. Rex Briggs February 27, 2014 at 8:58 am

    Hi Doug,

    As always, and interesting post. I recall those early days too, and by 1995, with streaming audio, it was already apparent that pageviews should not be our standard. Time of exposure became the next logical choice, but really, for advertising there are ads that a consumer can get within seconds, and there messages that take 10s of seconds. It isn’t the time, rather it is the impact we care about.

    What is the marketer’s goal, and does the ad accomplish it? If the goal is to build awareness, do we see a measurable change in awareness caused by the advertisement? If the goal is to improve brand perceptions, does it move the needle on the key brand perceptions? If it is to drive action, like calling, or visiting, or trying or repeat buying, does the advertisement do that?

    We’ve known the answer to digital since the first Ad Effectiveness Study in 1995. We know the answer to Mobile too (http://www.marketingevolution.com/white-papers/mxs-mobiles-x-solution/).

    The problem is that there is a difference between being able to easily and cheaply count something to transact on between media owner and buyer, and being able to measure the impact against the marketer’s specific objective.

    My humble solution is to build a benchmark database that translates exposure into typical impact on a series of metrics marketers care about. It is called “Impact Based Planning” and I write about it here: (http://www.marketingevolution.com/white-papers/not-all-impressions-are-created-equal/). We are seeing media owners like Time Inc doing deals based on the impact of the Mobile, Digital and Magazine buy, but these deals are still the exception rather than the rule. (AdAge Story Here: http://adage.com/article/media/time-drawing-reader-data-lure-marketers/243918/). I am interested in your input on how to make this more widely available to media owners, because you have definitely identified an itch that needs to be scratched.

    My hope is by making the translation from exposure to impact more easily and widely available, maybe we will boldly go where no one has gone before — a place where media isn’t just about eyeballs, but is about how it influences the heart and mind.

    Kind Regards,
    Rex Briggs, Your old buddy, and Founder/CEO, Marketing Evolution
    rex@marketingevolution.com

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