Dope on the table: The Conundrum of digital advertising
Let's talk a bit about the big pile of money for digital advertising. Retailers have a certain budget that they hand over to agencies. These advertising and digital agenices build target audience profiles, concepts and creative, take their cut, and hand it down the line to the byzantine maze of digital buying and selling. The digital buying and selling process includes Demand Side Platforms (DSPs), Ad Networks, Trading Desk, brokers, etc., that find the veticals for particular ads, sell premium ads directly to publishers or place low-brow ads in remenant hell. Also we must include the infrastucture that has also grown up around the often opaque process that insure ads are being run, run in approiate places and can report back what is happening.
Eventually the pennies that are left reach publishers. Where we publishers, like The Budget Fashionista, get offers of 0.50 CPM (Cost per thousand impressions). With .50 CPM, we won’t be retiring anytime soon, and there is no way we can run a business soley on advertising. Much to the chagrin of a lot of startup pitches that I hear. Even at such low CPM all that matters at the end of the day is the dope on the table. In other words, they just want the numbers.
It all comes down to expectations. I think part of the issue is too much information. On the web, every action is measurable, and I sometime feel like networks and such rely way too heavily on them. Depite some of the wonderful branding and engagement opportunties, we often find ourselves in the condrumum of being sold on the brand value but being assessed on the ROI. Additionally, these are for ads that do not appeal to our customers and dismal click through rates, not because we have users that won’t engage but because that’s not what is being measured.
That is changing as the digital landscapes become more mature. As advertisers and retailers start to shunt more resources to direct marketing on the web (and figuring out how to move people to act). I think we’ll start to see a shift in the questions being asked by retailers and the digital buying/selling industrial complex and the answers by publishers being more in sync.
Posted on Tuesday, October 12, 2010 in