Drugs & Display – Why digital advertising’s moment of truth has finally arrived…

It was supposed to be so different.

Display was supposed to the fuel the internet ran on.

It was supposed to replicate traditional advertising online and represent a way for publishers to monetise content, brands to gain attention and people to consume ads in a familiar manner.

But it hasn’t worked out like that.

The chorus for change was small and secluded at first. Isolated, intelligent contrarians like Bob Hoffman and Mark Ritson spoke about the incredible wastefulness going on in digital adland. The industry was sporadically shocked by reports about viewability and click fraud. As far back as four years ago I was speaking about display and its future in very negative terms.

But nothing really changed because nobody really had much incentive to change.

Until now.

Negative Momentum

There’s a palpable growing negative momentum around digital. The ‘digital truther’ movement is gathering pace. In the last 24 months, the display mirage has been slowly revealed. And the emperor has no clothes.

The wave of news coming out of digital advertising is troubling to anyone within the industry.

  • We’ve seen the speedy rise of adblocking as a way to combat intrusive, annoying, creepy and spammy advertising.
  • We’ve heard the IAB, in an unprecedented move, come out and admit that they fucked up
  • We’ve had Mark Pritchard, CMO of one of the world’s largest spenders on digital P&G give a passionate and practical speech decrying display and its “unreliable measurement hidden rebates and fraud”.
  • We’ve had Keith Weed of Unilever, another giant digital spender echo Pritchard’s sentiments.
  • We’ve had reports outlining how CPG retailers and shoppers alike gave digital advertising low marks for effectiveness despite rapidly increasing spend.
  • We’ve had numerous measurement ‘errors’ attributed to Facebook and Twitter, all of which seemed to overcharge advertisers rather than undercharge. Oh, and the new hot kid on the block has been receiving some bad reviews from marketers too.
  • We’ve had the growth of a media supply chain that’s at best unnecessarily complicated and at worst deliberately murky.
  • And at this very moment, YouTube is under serious scrutiny after a decision by Havas to join the British government in pulling ad spending from Google and YouTube in UK.

In the vein of some deep governmental scandal, the bad news just keeps on coming, and there’s only so much bad news an industry can take without being permanently scarred.

Trough of disillusionment

Speaking at the recent DMX conference in Dublin, I gave my take on digital advertising as it stands. In my opinion, we’re in the teenage stage of digital advertising – immature and unsure of what’s coming next.

To map digital advertising out onto the Gartner Hype Cycle, you’d place it as hurtling towards the trough of disillusionment.

We’ve passed the point where we thought digital could do everything, and was the holy grail for the web (peak of inflated expectations).

Quickly, it’s been realised that digital display and the industry that surrounds it is a deeply flawed house of cards that we’ve been pumping up for the last decade, blind to its failings.

In order to move towards maturity and the ‘plateau of productivity’, we need to clean house. We need less unnecessary complexity, more of an awareness of the failings of display and more critical thinking.

The industry hasn’t been intellectually humble enough over the past decade, and that needs to change. More healthy skepticism about digital might’ve gotten out of this mess sooner. But we’ve made our beds.

Institutional Scale Fraud

Just this week, a widespread report into ad fraud concluded that it could be bigger than any of us imagined, with an estimated $16.4 billion wasted to fraudulent traffic and clicks manufactured by bots. The report, commissioned by WPP agency The&Partnership and conducted by ad verification company Adloox described digital malpractice as an organised crime “second only to the drugs trade.”

This is Wall Street circa 2008 level institutional scale fraud. It’s the type of thing that Michael Lewis could write a book on, only we don’t realise it because we’re in the eye of the storm. It’s the advertising equivalent of the sub-prime mortgage crisis. It’s a time bomb waiting to blow that will pull in agencies, brands, ad-tech companies, social networks, publishers, holding groups and more.

Personally I believe that this is the end of days for the current model of display advertising, and the fallout will be enormous. Don’t rule out agencies being dragged into courtrooms by brands who only now realise what’s been going on in terms of fraudulent metrics, unethical kickbacks and malpractice.

We’re finally reaching a tipping point that could either clean up and improve, or obliterate digital advertising. Up to now, we’ve gotten away with it. But the digital display bubble is finally about to pop, and it’s up to the industry to ensure it doesn’t wreck our credibility completely and leave scars for years to come.

To look on the positive side, this is a chance for new beginnings, a clean slate for us to change the way we advertise to people online.

Hopefully the industry will take the opportunity to press the reset button so that we can move towards maturity.

 

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Further Reading:

The rise of the digital truther – Digiday
Pagefair 2017 Adblocking Report
Display ad tech ‘lumascape’
French advertising giant pulls out of YouTube – The Guardian
The Goldilocks Approach & Moving to Maturity
Pritchard calls for digital to grow up and clean up – Adage
Keith Weed ‘We need comparable digital metrics’ – Marketing Week
Getting LEAN with digital ads- IAB
CPG Digital Report – Adage
UK government suspends YouTube spend – BBC