Advertising is more than a Commodity

The following guest post was written specifically for Collective Wisdom:


Innovating with Pork Bellies
By Jim Calhoun, CEO, PopularMedia, Inc.

At the 2007 Interactive Advertising Bureau’s annual meeting, Wenda Harris Millard delivered her now infamous plea, “We must not trade our assets like pork bellies.”

Her remark resonates even more today. The digital media landscape is far more distressed now, and it’s only going to get much worse because consumer expectations and behavior have changed radically. Meanwhile, the publishing and advertising industry is still futzing around with pork bellies.

Millard’s analogy provides a great visual. An ever-increasing volume of ads get traded like pork bellies — standardized, processed, packaged, bought, sold, delivered and consumed in massive volume. Adding insult to injury, the Web is experiencing a rapid rise in inventory levels and a recession-fueled focus on measuring tactical return on investment in campaigns.
Needless to say, it’s a challenging time to be a publisher.

Millard argued that the shift towards commoditized media buying failed to fully value the unique role of the publisher’s assets in the equation, such as quality audiences, content and context.

While these components drive value, justifying premium pricing and cutting custom deals takes effort. Innovation takes effort. This is where publishers and agencies continue to make their big mistake: doing what’s easy, instead of giving people something they might actually enjoy or value. Ours is an industry addicted to interruption. There’s even a push for more interruptive ads. Is that really the solution? Keep doing what doesn’t work – just do it bigger, louder, and run all over the page! Lord help us all.

Through most of last year, pricing for premium publisher inventory remained relatively strong. Publishers enjoyed sales growth and took lots of orders. As the ad industry grew at a healthy clip, so did the consumers’ fascination with social networking. Highly useful (and addictive) services like Facebook grabbed a stranglehold on consumer attention by delivering an endlessly compelling flow of socially relevant entertainment.

Instead of figuring out how to capitalize on this shift in consumer behavior, publishers stuck with their models and expected the growth to continue.

Today, advertisers are demanding far more from their campaigns. Higher ROI. Make it social. They want innovation. There’s a lot to be learned from Federated Media’s approach to Conversational Marketing, or Gawker’s fascination with non-IAB “site skins.” These publishers offer something well beyond pork bellies.

Burger King’s “Whopper Sacrifice” was genius in this respect. Not only did it take a contrarian view of social media norms (delete friends from Facebook and get a free Whopper), but the campaign’s simple irony and reward mechanism created a socially engaging brand campaign so effective that Facebook killed the app. How about that for getting social media?

Consumers need more fun and engaging social experiences that are just great excuses to talk, laugh and share. Today’s consumer is online to entertain themselves in the company of their trusted friends and neighbors, not for the pork bellies.

Advertisers, publishers and agencies have to address the root issue, and provide consumers with solutions that create compelling, fun excuses to engage their friends in branded online experiences. And there’s no reason to limit that thinking to social media sites. After all, it’s not the destination that matters in social media – it’s the conversation.

The good news is that the building blocks are there. Creative and media shops know how to develop interactive sites and banners, and they know how to traffic scripted ad tags that are capable of delivering more engaging user experiences. Plus, publishers can target audiences with extreme precision.

Now all we need is for brands to start coming up with compelling excuses for people to engage their friends.

Jim Calhoun is the CEO of PopularMedia, Inc., which helps advertisers and publishers multiply the impact of their online ad campaigns and significantly increase user engagement by wrapping standard online display advertising units with an interactive social media layer.

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