Online Advertising Works Like Advertising

Yeah, yeah, yeah… We all know that online advertising revenue is down. According to the Interactive Advertising Bureau, revenue dropped 6.5 percent between Q2 and Q3 of 2000. And that number includes pretty much everything: 46 percent of the $1.98 billion spent was on banners, 22 percent was spent on sponsorships, and most of the rest was distributed among classifieds, referrals, interstitials, rich media, and keyword searches. Email ads made up 5 percent of the total. The hits were across the board.

My question is, Why?

Why are people suddenly deciding that online advertising somehow doesn’t “work”? Like many of us, I’ve been thinking about this question a lot lately. And I’ve been struggling to make sense of the whole mess. But then a few threads in my life seemed to knit together last week, and I think I’ve come closer to an answer.

First Thread

I was in a meeting last week with representatives of a local university to discuss their choice of a new advertising agency. The agency they picked had impressed them by stating unequivocally that they shouldn’t be spending their money on online ads. “Online advertising doesn’t work,” they were told. “It’s a waste of money.”

“Huh?” I thought to myself (a common occurrence). Why would seemingly intelligent people who supposedly know about advertising make such a statement? Especially when it pertains to colleges… Most kids learn about colleges online these days, so online marketing seems to be the perfect vehicle for reaching them. I continued to ponder the question.

Second Thread

Then I got a call from a reporter asking me to comment about what’s going on with GO.com. Apparently, Disney has decided to “zombify” the site, effectively putting it on autopilot and using it as a way to direct people to other Disney properties. From what I can tell, Disney isn’t selling ads in the space, and it’s not spending any money to promote it.

But get this: The traffic hasn’t really gone down. People are still flocking to the site at numbers nearly equal to those of its heyday, when it was being advertised heavily by the Disney machine! Does Disney care? Apparently not: It’s decided online advertising (at least as far as GO.com is concerned) doesn’t “work,” and it isn’t worth their time to sell ads into the space.

Hmm… more to ponder.

Third Thread

And ponder these questions I did as I headed up to New York to speak at Web Advertising 2001. I pondered on the train (in between bouts of real work and some wicked games of Majesty). I pondered as I walked past the wall-to-wall ads in Penn Station on my way to the taxi stand. And I pondered as I sat in the cab on the way to the hotel, watching the billboards, transit ads, and cab-top ads whizzing by.

So I pondered and I fumed and, as I looked out the window, I realized something I’d never realized before: Those ads stuck to the tops of cabs (and those ads stuck to the sides of buses and those ads on bus shelters) reminded me of something, something I couldn’t quite put my finger on. What was it? What did those long, narrow ads look like?

Eureka!

And then it hit me. Banner ads! Those taxi tops, bus sides, and billboards reminded me of banner ads!

And they were everywhere: Every surface in Manhattan that can hold an ad has one plastered on it. Apparently, someone isn’t questioning whether those outdoor ads “work” — at least it’s not evident from all the money that must have been spent on putting them there.

But how measurable are they? How many click-throughs are those bus tails getting? (Not too many I hope… you could end up in the hospital.) How measurable are the direct-response results from the taxi tops? What kind of success metrics is the City of New York being held to when selling transit shelter ads?

These aren’t exactly rhetorical questions… not exactly. Obviously, somebody is asking for some sort of results when they plunk down their cash to advertise in the subway, on the side of a building, or on a bus. But, as we all know, those results can be tough to measure. We can get an idea of the number of people who will see those ads, but measuring the success of the campaign usually has to incorporate results from many different messages displayed in many different types of media.

False Gods

To paraphrase John Wanamaker: “I know that half my advertising isn’t working… I just don’t know which half.”

By pushing direct measurement (clicks) as the defining element of online advertising from the beginning, the online ad industry has made sure that it becomes painfully apparent when the online part of a campaign is what isn’t “working.” Direct-marketing principles have been applied to all forms of online advertising. Consequently, benefits such as brand recognition (which we take for granted as being something that can be generated in the case of so many other types of advertising) have been discounted in a slavish adherence to the worship of click-through.

The result? The situation that we’re in right now: We’ve got literally millions of people passing by Web sites every day (e.g., GO.com) and no recognition of the value of those eyeballs.

I’ve got one thing to say to Disney: Give me the space! If you don’t believe that online advertising works, give me a month to do some advertising on GO.com, and you’d better believe that a heck of a lot more people would know my company than do now. Sure, they might not click on my ad, but I guarantee that a lot more folks would know the name “Carton Donofrio Partners.”

Ads Are Ads

There are two basic parts to advertising: Create a compelling message; put that message in front of as many people as possible. It’s that simple. Why have we confused it?

Probably for the same reason so many aspects of the new economy confused so many basic issues: The Web was new, different, and exciting. It seemed like everything should be different. It’s not. Ads are ads. Magazines still need readers. Catalogs are catalogs, whether we access them online or get them in our mailboxes. Heck, I’ve shopped from catalogs for plenty of stuff in my underwear (or less) but never thought anything of it. Why should “shopping in your underwear” online be any different?

What’s wrong with advertising on the Web? Nothing… as long as we define what we’re trying to do and set realistic expectations. Is the Web going to change everything? No, at least not right away. In the meantime, as we’re all finding out, the basics still apply.