Monday, May 13, 2013

The Great Ad Problem

A couple years back, McDonalds ran a banner ad, presumably to promote their dollar menu. It didn't quite have the intended effect.

Pictured: what 20-somethings say when they want a burger.

For a blip of time in the mid-2000s, an animated banner ad with those three frames proliferated around the Internet. It even came out that the advertisers had no clue that "I'd hit it" had any sexual innuendo associated with it at all - they sincerely thought that it was like any other throwaway slang from the younger generation. By the time McDonalds could redact the banner ads, it had already been mocked to hell and back.

This gaffe is best explained by assuming the advertisers were out of touch with their audience. In a lot of ways, this is a problem with online advertisement in general - they're out of touch with their audience, and everyone suffers for it.

Ads are the lifeblood of online business. YouTube thrives on it. The SomethingAwful forums report that the on-site ads help cover the $3400/month bandwidth. The free information and entertainment that we find online is made possible by ad revenue.

There are two ways that an advertisement can benefit its publisher site: by visit or by sight. The design of a good ad should leave an impression on the viewer, and hopefully the viewer remembers the product for later. The viewer can also opt to click the ad, sending them straight to the vendor's website. Because visits and visual hits are both important to the product dealer, advertisers pay their host sites by page views, clicks, sales, or some ratio of the three. This framework has allowed online websites to flourish.

But ads are only profitable if they are actually capable of bringing revenue to their vendors. Do online ads accomplish this?

One 2009 study shows that website traffic to vendors' websites was about 50% higher after exposure to an ad campaign. However, only 16% of internet users clicked on advertisements, with no further information offered on purchasing rates. In 2012, marketers and internet users had a large rift in opinion over the effectiveness of online ads, with most online goers saying that traditional advertisement was more effective. It seems that online ads do boost attention to their vendors, but do not penetrate far into the online audience. There's even a term that describes what happens when people mentally block out online ads altogether - "banner blindness".

What's more, being online allows Internet users to subvert advertisement altogether. Approximately 12 million people use Adblock Plus, a browser add-on that automatically blocks advertisements and allows for surfing the web ad-free. It is the most popular add-on for Mozilla Firefox. This is an unsustainable approach for consumers to use, since blocking ads from a website also block the website from ad revenue. But it demonstrates a clear frustration that online users have with advertisements.

It's not hard to see the appeal, either.

The Internet provides a lot of virtues to the advertiser - lower costs, higher proliferation, lots of data to analyze. Some businesses might even be content with the current performance of their ads - maybe enough sales from online ads really are generated to keep ad revenue sustainable. But it seems suspicious to me that, despite all those virtues for the advertiser, online users still mostly want to ignore their ads. How sure are we that this cash flow from advertiser to website is sustainable?

It is also true that television and radio have been functioning on the ad revenue model for decades. In those situations the data in front of advertisers is less precise than online advertisement data, but since there must be some correlation between promotion and sales, the model stays in use. How prepared are advertisers for trudging through the huge amounts of data that come with ad monitoring? How prepared are we for the situation that the data gets analyzed, and it's concluded that online advertisement needs to be cut back, or isn't worth it at all?

This is an issue that affects everybody - the advertisers and their jobs, the websites and their revenue streams, and the users and their free content. Therefore, it benefits everyone to ask ourselves how do we make ads better? Where are ads going wrong?

Well, let's start from the beginning. How were most people first exposed to online advertisement?

Oh boy! An unsolicited email is promising me stuff!

The Internet's early days were not a high point for online ads. When most of us started going online, most of the ads that we were exposed to offered deceit or outright fraud.

Remember the "FREE POKER ONLINE" pop-ups, or the "Viagra for cheap" emails? Not only are these messages commonplace even to this day, they give an image of sketchiness. These things are both straight appeals to vice, which will already color people's perceptions of the vendor. Online gambling isn't even legal in America, so why do these ads still exist? It doesn't help that these messages are clearly automated and often rife with misspellings.

What about the incessant pop-ups telling you that you were the one millionth visitor to the website and had earned a free iPod? Remember how that little flash ad in the corner guaranteed that you'd be eligible to get an XBox if you could punch Osama bin Laden's pixelated head in the face with your mouse cursor? Of course, you learned quickly that these goods were only free if you signed up for subscriptions to a bunch of other things, often for a monthly fee. Those ads probably didn't get too many clicks after their first year.

But hey, if it's your IQ on the line, it's worth it, right?

Let's not forget the scams, either. Everyone knows about the business deals with Nigerian princes at this point. What about the offers for savings from financial companies you've never heard of? Imagine being in the position of the online user, receiving messages like this while simultaneously hearing about online fraud. This might leave people a little wary.

Online users have been bombarded with half-baked advertisements. Online anonymity makes it impossible to distinguish between individuals, which makes it equally impossible to distinguish between good and bad vendors from these ads alone. You can't even necessarily trust the link in the banner ad - what if it's a phishing scam? What if it gives you a virus?

Internet users have - rightfully - placed a high value on ad filtration. It explains why AdBlock is so popular. It explains why the junk mail folder is a crucial component of our email accounts. We have been trained to distrust and ignore ads. I'm sure that some advertisers would resent the fact that I'm grouping their career efforts with the likes of spammers, but they should be resentful of these low quality ads that have sabotaged their marketing efforts.

Even after all these years, low-quality advertisements pop up frequently. The lies are just as frequent and transparent. There's next to no cost associated with making such ads, either. They use easy photoshop tricks, catchy taglines, and a false air of authority to levy their outrageous claims.

Cambridge scientists AND a photoshopped model say it's true, folks!

This is a problem that is already gaining recognition. Google and Facebook have both taken steps to crack down on scammy ads. They are presumably aware of how the reputation of online advertisements affect their sustainability as websites. But since everyone has a stake in good online advertisement, the efforts against bad ads should be wider spread.

So, how are advertisers responding to the ineffectiveness of their ads?

The new big thing has been targeted advertising, wherein advertisers use information about your demographic, purchasing habits, etc., and target specific ads to you. This is an old idea, but big data puts a new spin on it. Facebook, with the information it gets from its like button and other such things, already offers an online framework that advertisers can use for targeted advertising. Twitter targets ads at you based on the keywords that you use in Tweets.

One small survey shows that consumers prefer ads catered to their interests than they do random ads. It's possible that targeted advertising will help sales more, but targeted advertising doesn't really address the pervasive skepticism towards ads that we discussed earlier. If anything, I'd guess that it would decrease trust - privacy watchdogs are already jumping on the issues behind mining personal information for ad targeting. Given what we discussed before, these efforts at targeted advertising end up seeming misguided.

Not to say that targeted advertising can't be delightful sometimes.

Here's a crazy idea that might be worth considering in place of refining your banner ads: people respond better to other people than they respond to ads.

One larger survey shows that the sources that people dominantly trust are brand recommendations and online reviews. This refers to people who post their thoughts on products on message forums and on product review websites, often unmotivated by financial incentive. This gives them a greater air of sincerity to other online people - an important human element.

Advertisers could learn from this. For them, this means finding ways to personally promote products on review sites and message boards. It also means being cognizant of the communities that you reach out to and not just going in with an exclusive desire to promote your wares.

Perhaps we need advertisers to start designing their advertisements not just around the interests of their consumers, but also their social habits. Trust is an important part of any human relationship, so why shouldn't trust be a goal when you want someone to spend money? The Internet is the most interactive mass-media product that we have to date, so why aren't our ads interacting with us better than they currently are?

In addition to this, perhaps we need to see more effort among marketers to police each other. Doing so would not only expose bad marketers, it would also build up a company's trustworthiness and image of accountability. Until advertisers find a way to address the unfortunate fact that their good ads are in the company of bad ads, there will be a disconnect between them and the online user.

I realize that these suggestions demand a lot of resources, but the bar is currently set low. Should the ad-hosting websites really be the only gatekeepers for what ads go public? We could explore using a strong regulatory body for ad distribution, or we could be more confrontational about bad advertisements - either option is better than nothing. Should it really be acceptable to promote your wares on irrelevant forums through bots with broken English? It can't take much effort to track what your bots are posting and to make sure they don't seem so artificial, but it would drastically improve your image as a company.

This Adbot understands what to talk about on video game forums.

As stated earlier, ads are not bad things. The Internet's power as an open resource - and its impact on our culture - sustains itself on ad revenue. For everyone's sake (including their own), advertisers need to reach out to their audience in a better way. Until this sort of human element - or, at minimum, human quality control - can be properly achieved, advertisers will remain out of touch with their audience. If you can't fix that, then you might as well insinuate that we like to have sex with cheeseburgers.


  1. Nice article, but actually advertisers are already ahead of the game on this. It's quite common for advertisers to pay people for reviews that are supposed to appear authentic. They're also paying people to post on forums and comment on blogs. Because of this, I take all online reviews with a grain of salt.

    1. Very true! I suppose it's a matter of how authentic the reviews and comments actually appear. Some professional reviewers are less transparent about who's paying them off than others. But this might depend on what industry we're looking at - the gaming industry, at least, is notoriously bad about this, but I might only be able to say that because I've hung around those corners of the web for a while. I can't speak for other industries.

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