Web Advertising Doesn't Work

“I do not regard advertising as an entertainment or an art form, but as a medium of information.”
David Ogilvy, Ogilvy on Advertising

It’s been more than four years now since Hot Wired introduced ad banners to the web. Last week (as I write this), first-tier industry analyst Aberdeen Group forecasted that web advertisers will spend $5.1 billion in 2000 on online advertising. A couple of weeks before, the IAB determined that advertisers will drop $1.4 billion on web advertising this year.

But in the face of those fairly staggering numbers, Market Facts tells us:

  1. The number of people who “never” look at banners jumped from 38 percent to 48 percent in the last year.
  2. The number of people who look at banners “very often” or “often” dropped from 16 percent to 9 percent over the last year.

There’s the rub. All the encouraging figures people cite about online ads have to do with how much money advertisers are spending on them. All the discouraging figures people cite about online ads have to do with how few people are responding to them.

Something is wrong with this picture.

To me, the issue seems simple (always a bad sign, I know): To be still facing the question of how to make advertising work after four years and billions of dollars might just mean it’s time to entertain a painful thought.

It might be time for us to admit that the reason we haven’t figured out how to make web advertising work is because it doesn’t. Time to realize that if people don’t click on banner ads — and they don’t — they’re of no value to anyone. The old saying, “If a million people tell you you’re drunk, you better lie down,” could very well be the operative one here.

It’s Not The Way You Do It

At the heart of the question is not how to measure click-through, or what the pricing model should be, or whether you pull more eyeballs by putting “Click Here” on the banner, or how tall a banner ad should be. At the heart of the question is how effective a medium of information is web advertising — not just in and of itself, but when compared to all the ways of communicating information that are available to us.

Ask anyone from any ad agency: Even effective, conventional advertising always comes to the party with a ton of strikes against it — and clients remind them of it all the time:

  1. Advertising is intrusive and annoying. Of course, it has to be, when faced with so much competing noise.
  2. Advertising provides limited information. How much information can you pack into 75 words on a full-page ad, when the primary purpose has to be “impact,” “brand recognition” and “quick read”?
  3. Advertising equals low credibility. You don’t believe what you read in ads, and neither does anyone else.

  4. Advertising is hard to track. How many agencies have explained to you that advertising is a branding mechanism — good results don’t translate into increased sales.

These are acceptable downsides in the world of print advertising, broadcasting, exhibit displays and the like — there is no better alternative. But what worked way back in the Space Age doesn’t work today.

So why are we struggling so hard to bring such a limited, outdated and rickety form of communication to the modern marketing world? To the world of the web, where so much information is available in so many forms all at the touch of a mouse button?

What Really Works

It’s not whether advertising on the internet is possible. It’s whether it’s a good tactic in the first place. I mean, there are a dozen ways to get from London to New York City — who would choose an inner tube over the Concorde?

So then, if web advertising doesn’t work what does? Let’s look at four fundamental purposes of advertising and highlight more effective — and proven — alternatives for accomplishing those goals:

  1. Branding. On the web, branding is relationship building — relationships developed by the value you provide visitors and customers. One of the most overlooked methods is push email contact — most often in the form of newsletters and other corporate mailing lists. Establish opt-in programs of your own, and sponsor other companies’ newsletters and mailing lists.
  2. Comparison shopping. On the web, users can call up a search engine or directory list of every company that sells what they’re looking for. Grow your presence in the engines and directories through specific optimization initiatives.
  3. Creating product trust. Product trust is accomplished through credible press and referrals — through word of mouth. And on the web, word of mouth comes from affinity groups and online communities. Reach out across your markets and develop broadly inclusive link exchange programs with partners and related product and service providers.
  4. Driving visitors to your site. Offline advertising — the kind that P&G is steadfastly sticking with just as it backs out of the FAST initiative — is proving to have great value in driving people to online venues. Get aggressive with promoting your web site at trade shows, in print, and over the airwaves.

I’m No Prophet But…

The virtues of — or lack thereof — online advertising has become a religious argument. Everyone takes a side, finds research that supports it, and then defends it with zeal. I may be right. I may be wrong. There are a lot of people putting a lot money and effort into it, thinking I can’t be right. People who think that online ads will reap big rewards: If not today, then the day after tomorrow.

But in my day after tomorrow, I come home from the office, launch my personalized portal and let it know that I want to buy some saddle bags to tote my briefcase on my motorcycle (in my future, there are still bungee cords and they still annoy me).

My portal agent evaluates my buying habits (I like good buys on the best quality), determines that rugged is a key characteristic since I’ve dumped the bike twice in the past six months, picks black over brown (to match my gas tank), and matches the credit card I use with those accepted by potential sellers. Finally, it presents me with the qualifying sites within my area as well as the best deals online, summarizes what’s available, and includes links to each site.

In my day after tomorrow, I don’t stop this process midway and shout: “No! For God’s sake don’t show me products, prices, locations and availability . I want to see BANNER ADS!”

But you know, maybe I’m missing the point entirely.

Not that something like that has ever happened before, of course. I speak smugly, adjusting the angle of the gold chain across my Nehru jacket, waiting for the latest upgrade of PointCast to finish downloading.

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