Online Media

The Web at 20: Assault on Page Mountain.


The Web at 20Raise your hand if you remembered the big birthday last month?  No, it wasn’t anybody in the royal family or any of the Kardashians. (Were any of them actually born or simply the result of a script development process?)  No, last month the World Wide Web turned 20!  I’d buy it a drink, but that won’t be legal for another year.  Anniversaries and birthdays are great times for reflection, so I’m using this week’s Drift to light some candles, illuminate and ruminate.

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In 2010 – when the Web was not yet out of high school – I gave a speech calling out a dozen “Dead Ideas” that were continuing to plague and hamstring the growth and development of internet advertising.  There’s one in particular that’s gone from dead idea to zombie curse:  it’s the idea that we’re going to continue dealing with “a web of pages.”  (See the video of this part of the speech or click here to view the entire 30 minute presentation.)  When the web first emerged (months after Tim Berners-Lee’s invention of hypertext) it was essentially a place where known individuals shared things with one another.  (Imagine a Flintstones era version of Tumblr or Instagram used only by Fred, Barney and their friends in Bedrock.)  Rapidly that model fell away and we started building hundreds, thousands and soon millions of websites.  To make money, we created an artificial construct in which consumers generated page views, which in turn begat a number of ad impressions, which then called out to multiple servers saying “feed me an ad.”  The whole thing got so ridiculous that we now call on futures trading technology to manage the vast ocean of commodity “impressions” we’ve created.  Margins grow ever smaller and consumers become ever more indifferent to the omnipresent , impotent banners with which we continue to carpet bomb them.

But now, at 20, web advertising has the chance to grow up.  And several gathering trends will force it to do so.  Call it the social-tablet-video Tsunami.

Social: Google may always have a far bigger market cap, but Facebook is the company that will have revealed the biggest idea of the digital age: the social graph. By connecting and illuminating “the web of people,” Facebook first established a parallel digital world for consumers and marketers, then reattached itself and began to retroactively change the web.  Once exposed to the ability to market to – and through – actual people, marketers won’t go backward to pages and impressions.

Tablet: According to Venturebeat, tablets will outsell laptops 6-1 by 2017.  That’s a whole lot more swiping, tapping and pinching, and a whole lot less clicking and scrolling.  The physiology of navigation is changing.  Does anybody think the structure of search, content and viewer experience won’t change with it?  And this is not even taking into account the true mobile consumption via smartphones.

Video:  Once you go video, you never go back.  Nuff said.

Am I predicting that individual sites or media companies won’t be able to run great businesses on the web anymore?  Of course not.   That would be foolish.  But not nearly as foolish as believing our 20-year-old assumptions about the economic structure and value equation in digital media will continue to hold.  They won’t.  And I, for one, am excited to see what’s on the other side of page mountain.


Six Words About Digital Marketing.


Six Words About Digital MarketingIn workshops I often challenge digital sellers to distill their ideas, selling points and customer challenges into as few words as possible.  In one very trying exercise, the goal is to boil down your sales e-mail to 140 characters.  It’s amazing how powerful and incisive written words can be when they’re carefully rationed. 

These exercises inevitably make me think of the “Six Word Stories” website, a concept so clean and simple it needs no explanation.  Submissions range from tragic (“Man cries holding his dog’s leash”) to streetwise (“Tanline on his ring finger?  Goodbye!”) to whimsical (“Apathetic prophet makes a pathetic profit”.) 

This week’s Drift is proudly underwritten by NextMark, which helps you boost your direct ad sales by giving you a steady flow of qualified, actionable sales leads without the hassle of RFPs! To learn more, visit www.NextMark.com/compass.

Since I normally enjoy a generous word count every week (the average Drift comes in around 500 words), I thought I’d challenge myself to write a series of “Six-Word Business Stories” about familiar themes in our industry.  Enjoy, and please share your own in the comments section.

Programmatic Buying:  Hysteria about RTB.  Now look deeper.

Native Advertising:   Fluoride in Digital Water Supply. Drink!

Clickthrough: Freddy Krueger in our accountability nightmare

Mobile:  Your mobile strategy?   You’re asking NOW?

Viewability:  Can’t ignore what you can’t see.

Google:  George Orwell spinning in his grave.

The Conference Circuit:  15 minute celebrity, 300 times annually.

Trading Desks:  Exhausted Wizard behind curtain. Don’t look!

Banner Ads:   Distribution system. Just needs some imagination.

Integrated Marketing:  It happens. For better, or worse.

Digital Sales:  After gold rush…. learning to dig.

Social Media:  Human Growth Hormone for Worthy Campaigns.

The Drift:   Back to 500 words next week!

Do you lead a digital sales organization?  Want to compare notes and ideas with your peers in a structured, collegial environment?  Save a seat at the Upstream Seller Forum on Thursday June 27th in New York.  Networking dinner on Wednesday June 26th is included.  For more information call Tamara Clarke at 802.985.2500 or visit www.thesellerforum.com.


The Illusion of Inclusion.


Illusion of InclusionThe 20th year of online advertising is underway and clearly so much has changed.  Today’s bandwidth, technology, devices and automation would be unrecognizable to those of us plying the trade back in 1994.  But there’s one thing from that long ago era that’s still with us:  Far too many digital sales teams are still organizing themselves around the agency RFP.  And the consequences are disastrous.

I’ve written about the industry’s flawed RFP process in this space before – comparing many online sellers  to blindfolded kids hitting a piñata hoping candy comes out.  But across the dozens of workshops and scores of seller interviews I conduct each year, I still hear seller after seller, team after team assuming the RFP process is their key to success.

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The assumption goes like this:  (1) We will work hard as an organization to introduce our company and products to agency media teams, with the goal of being included on future RFPs.  (2) Once we start receiving those RFPs we’ll work hard on the responses (often at the last minute) and throw a ton of added value and fresh ideas at them.  (3) When we do win a spot on a plan, we’ll then service the hell out of the business, watching the results like a fever chart, optimizing them where possible and bonusing a bunch of impressions when desperate.   (4) Repeat this often enough and you’ll gain the economic loyalty of the agency and client.

But it just doesn’t work that way.  “Inclusion” in the process is illusory…a pyrrhic victory.  “Inclusion” of one more player on an RFP means less than nothing:  it costs the buyer nothing –not even a stamp – and most of those included never have a legitimate shot of making the plan anyway.  What’s most damaging is that money, resources and — most critically – valuable time are thrown at this flawed set of assumptions.

Sound hopeless?  Only for those who choose not to change the equation.  Start by accepting the RFP process for what it is:  a formal justification process for that which the agency already wants to buy for its client.  Now put your valuable human and financial capital to work on two new agendas: disruption and systemic enhancement.   First, frame a disruptive challenge to the customer’s thinking and work hard to introduce it at a high level well before the RFP process even begins.  What do we know about the consumer, the process or the market that would be valuable to this customer?  What will cause them to look at things differently?   Once you’ve driven a wedge like this into the customer’s reality, focus on how your company can bring long term value to this customer’s process. Focus less on making the plan and more on making a difference.

Can you make these choices for all your customers right now…today?  No.  But you can choose a handful of your most deserving brands and agencies and change your approach tomorrow.  Let me know if you want to talk about how.


Staying Dry in the Rain.


Less than a month ago I led an all-day meeting of a few dozen digital sales leaders at The Upstream Seller Forum.  One of our topics was “The Incredible Shrinking Third Quarter,” a discussion prompted by the experiences of many in the room: they’d experienced a surprisingly soft July-August-September (a trend borne out in our internal group polling.)  We postulated all the reasons why this may have happened:  Were advertisers sitting on their wallets till the election results were in?  Was all the money getting sucked up by programmatic trading?  No really clear answer emerged then, but just now the story takes an interesting turn.

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According to a report just released by the IAB and PriceWaterhouseCoopers, internet advertising revenue for the third quarter of 2012 shot up nearly 18% to a historic high of $9.3 billion.  Turns out it had been raining money throughout the late summer and early fall, but fewer and fewer companies were getting wet.

Welcome to the age of consolidation.

For many years there had been a tacit understanding that the largest share of online revenue would go to the largest players.  But it had also been true that the rest of the bounty would be somewhat evenly distributed across thousands more websites and networks.  If you kept your product offering fairly current, sprinkled on some innovation and covered the agencies pretty well you could anticipate at least modest revenue growth on pace with the industry norms.  I think we can now declare that era officially over.

Today consolidation is the law of the land, and it’s a ruthless and impersonal taskmaster.  Marketers have told their agencies to do bigger things with fewer players.  There’s also the very real consolidation of DR and audience dollars into programmatic channels:  it’s not the whole story, as some “progs” would have us believe, but it’s a very important chapter.  If your Q4 revenues bounced back pretty well, don’t be lulled into complacency.  The walls on Fort Knox have gotten taller, and that’s not changing.

So if you’re a smaller publisher or an innovative network, do you just give up?  No.  You adapt, very quickly.

  1. First, abandon your “strategy of inclusion.”  Many sales organizations are built on the idea that they’ll generate lots of RFP activity, play nicely, and “earn their way” into the agency’s heart and the client’s budget.  Instead pursue a “strategy of positive disruption.”
  2. Next, stop trading commodities.  Selling “holes in pages” is nothing more than zombie sales activity.  As I’ve said in this space before, banner “space” is now fully commoditized.  Start focusing more on the stuff that at which you are the “first, best or only” option.
  3. Finally, head for the border.  Companies and sellers who synthesize, blend and combine will continue to thrive.  As much as that junior planner wants everybody to fit in a neat little planning box, there’s power in spanning channels, media, markets and disciplines.

If you’d like to know more, or to equip your team for a journey out of the desert, just give me a call.  Wishing you a happy, prosperous and “wet” 2013.


We Love a Parade.


Over the past week, I’ve been asked at least a dozen times about Federated Media’s much ballyhooed decision to “shutter” its direct ad sales business in favor or “programmatic buying and native advertising” businesses.  In Adweek, Tim Peterson described it as a move that “…could presage a foundational shift in the online advertising landscape.”

To which I would say, “Settle down Tim.”

Because of Super-Storm Sandy, The Upstream Seller Forum Dinner was rescheduled for Wednesday night November 28th and The Seller Forum to Thursday November 29th at the Thomson Reuters Building.  Because of the change, a handful of seats have become available for qualified CROs, EVPs, SVPs and VPs of sales.  If your company would like to be represented at this important event, please reach out to us right away.

Let’s look at the facts.  While the business press loves a good paradigm shift story — and Federated would very much like to run in front of the parade that’s already forming — individual publishers are making these kinds of decisions every day.  Just without the grandstanding.  In the Upstream Seller Forum events we host, there’s been a thoughtful running debate for close to four years around the role of ad exchanges and programmatic channels in the publisher’s world.  To these thoughtful publishers, the revenue world looks like a series of dials and switches to be carefully turned and calibrated.

So why the big announcement and all the breathless press coverage and Twitter chatter about Federated?  In one of her press interviews, CEO Deanna gave a pretty good indication when she pointed out “…when you’ve got an independent company like ours that’s venture-funded, we need to make bets that we know will [see] return.”   I would suggest that the “return” in this case is actually ROIE:  Return of Investor Enthusiasm.  Federated and its bombastic founder John Battelle have always had a bigger profile on conference stages and inside the boardrooms of Sand Hill Road and Silicon Alley than they have in the daily give and take of the media and advertising world.  Tying the company’s future to a press release that includes both programmatic and native makes all the sense in the world.

In the past five years, the venture community has been over-funding the ad technology space with the subtle precision of drug dealers handing out stacks of Benjamins.  Some kind of “validating event” — like, say, a high-profile publisher firing her high priced sales team and betting everything on technology and self-service — is the hopeful narrative that keeps the house of cards standing a while longer.  But the quiet, careful recalibration and streamlining of the media and marketing worlds has been going on for years, and will continue for years more.  It’s not as sexy and dramatic a story, but it’s the truth. The revolution will not be televised.

Will the programmatic, data-enabled buying and selling of ads be a bigger part of our business?  Absolutely.  Is “native advertising” also a meaningful growth area?  The jury is still out:  if it is, it’s influence will be unevenly distributed to a handful of players.  Is it time to start firing direct sellers?  That’s laughable.

Will we continue to over-react to showy press releases and other forms of corporate misdirection?  That’s up to us.