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Advertising is a $600B a year business, and the Internet still has yet to catch up with other media in terms of share of total budget versus time spent on the m

Advertising is a $600B a year business, and the Internet still has yet to catch up with other media in terms of share of total budget versus time spent on the medium. Google just reported revenues up 35%. It's all advertising, driven by high quality algorithms and lots of data. Internet advertising is more effective than other media and we're still just scratching the surface. I'd like to comment on all the specific ad startups and their revenue and growth rates but I'm not able - you'll just have to wait and see it. Happy to make a $1 bet on the subject with any naysayer here or with the author of this shoddy article.

einhverfr 14y ago
But internet advertising is a relatively lousy form of advertising. Compare to print and radio ads. I hear a radio ad. It is interesting. I write down the number and call the person. Not ideal, but I am reminded by the medium that I must act now or else I lose the info of the ad. Same with tv ads. But even to ensure people can follow up you have to have the ad repeated over and over. With print ads, I can cut them out and save them. Less urgency, and a lot of durability. Online advertising, with the possible exception of advertising on search engines, provides the illusion of durability without delivering it. So it's an inferior medium. I am not saying that online advertisements are doomed. I think we haven't figured out how to do it, and borrowing print analogies isn't sufficient. Or perhaps, if we are going to borrow print analogies we ought to take them all the way (selling ad space on specific pages on a non-rotating basis for example).
- paulsutter 14y ago
  I agree that there are a lot of advancements to be made. However, my experience is that Internet ads are already more effective. But forget all that, are you ready to bet me $1 over the future of online ads? Go ahead and formulate the terms. I'll take the optimistic side and you can have the pessimistic side of whatever you come up with.
  - einhverfr 14y ago
    I will say that in my experience, depending on audience, I have found radio ads and general PR efforts to both be more effective at reaching consumers than I have found internet ads. Speaking strictly of ROI. I am willing to say that the following forms of advertising are doomed: * rotating banners * rotating in-content image ads * pop-up ads (whether div- or window-based) * side-bar ads in content The real challenge I think is to replicate the success at search engine advertisement (which seems to be good) elsewhere. For this reason I think that whatever ends up working will be very different than what we have now. Yeah, I'd bet a dollar on that proposition.
    - paulsutter 14y ago
      I'm asking for a bet on the future of Internet advertising generally. Not to take a collection of the shittiest known implementations of advertising and bet on them. I'll interpret your response to mean you think Internet advertising (considered broadly) will be successful, and I agree with you. In contrast with the technology review post which predicts some sort of bizarre general "collapse" of the Internet (presumably of advertising as a business model). If not please reform your bet accordingly. ps, love to engage in an email discusion to hear more about the radio and pr(?) campaigns you have run that have worked better than Internet media.
      - einhverfr 14y ago
        paulsuttder, sure email me. In general I found when I was starting out, radio ads delivered the best ROI, and internet ads were down there with yellow pages ads.
jacques_chester 14y ago
> Advertising is a $600B a year business The point is that, from an advertiser's point of view, most of that money is wasted. Insofar as they can target ads and pay less for them, they will. That $600 billion is not going to transfer on a 1:1 basis into the internet advertising market.
- paulsutter 14y ago
  Are you willing to make a $1 bet predicting the general demise of the Internet advertising business? (I think the article called it a "collapse")? I'm having a hard time understanding exactly what concrete outcome you are predicting based on your post. Are you predicting a 1:0.9 ratio? 1:0.001? 1:1.1?
  - te_chris 14y ago
    I'm pretty sure he wasn't predicting a demise, just margins that won't be as sexy.
    - michaelt 14y ago
      Well, the first line of the article is > Facebook not only is on course to go bust but will take the rest of the ad-supported Web with it. Perhaps that's just a juicy opening line to draw people in to the article - but it sure sounds like predicting a demise to me. Some of the things the article says are reasonable - but I wouldn't bet a dollar on facebook going bust and taking the entire ad-supported web with it.
      - jacques_chester 14y ago
        > it sure sounds like predicting a demise to me. He is. Of Facebook. Facebook is not cheap to run. If revenues fall and costs do not ...
  - lmm 14y ago
    I'd put $1 on the following proposition: 30 years from now, the advertising industry (i.e. in which sellers of products pay directly for advertising - advertising which is not content and does not attempt to confuse the receiver about this) will have less than 1/10th the revenue it does today, as a proportion of the total revenue of all industries put together (I'd say "GDP" but I think that may be defined in terms of profit rather than revenue - and I expect margins to shrink everywhere). (I think we'll see a big rise in viral marketing, shill and semi-shill reviewing (Klout, amazon's programme where they send products to highly rated reviewers), product placement and sponsored content (the my little pony cartoons; mad men with jack daniels; akb0048), which will blur the line between advertising and content creation. But I think outright ads will collapse)

einhverfr 14y ago

But internet advertising is a relatively lousy form of advertising. Compare to print and radio ads. I hear a radio ad. It is interesting. I write down the number and call the person. Not ideal, but I am reminded by the medium that I must act now or else I lose the info of the ad. Same with tv ads. But even to ensure people can follow up you have to have the ad repeated over and over. With print ads, I can cut them out and save them. Less urgency, and a lot of durability. Online advertising, with the possible exception of advertising on search engines, provides the illusion of durability without delivering it. So it's an inferior medium. I am not saying that online advertisements are doomed. I think we haven't figured out how to do it, and borrowing print analogies isn't sufficient. Or perhaps, if we are going to borrow print analogies we ought to take them all the way (selling ad space on specific pages on a non-rotating basis for example).

paulsutter 14y ago
I agree that there are a lot of advancements to be made. However, my experience is that Internet ads are already more effective. But forget all that, are you ready to bet me $1 over the future of online ads? Go ahead and formulate the terms. I'll take the optimistic side and you can have the pessimistic side of whatever you come up with.
- einhverfr 14y ago
  I will say that in my experience, depending on audience, I have found radio ads and general PR efforts to both be more effective at reaching consumers than I have found internet ads. Speaking strictly of ROI. I am willing to say that the following forms of advertising are doomed: * rotating banners * rotating in-content image ads * pop-up ads (whether div- or window-based) * side-bar ads in content The real challenge I think is to replicate the success at search engine advertisement (which seems to be good) elsewhere. For this reason I think that whatever ends up working will be very different than what we have now. Yeah, I'd bet a dollar on that proposition.
  - paulsutter 14y ago
    I'm asking for a bet on the future of Internet advertising generally. Not to take a collection of the shittiest known implementations of advertising and bet on them. I'll interpret your response to mean you think Internet advertising (considered broadly) will be successful, and I agree with you. In contrast with the technology review post which predicts some sort of bizarre general "collapse" of the Internet (presumably of advertising as a business model). If not please reform your bet accordingly. ps, love to engage in an email discusion to hear more about the radio and pr(?) campaigns you have run that have worked better than Internet media.
    - einhverfr 14y ago
      paulsuttder, sure email me. In general I found when I was starting out, radio ads delivered the best ROI, and internet ads were down there with yellow pages ads.

jacques_chester 14y ago

> Advertising is a $600B a year business The point is that, from an advertiser's point of view, most of that money is wasted. Insofar as they can target ads and pay less for them, they will. That $600 billion is not going to transfer on a 1:1 basis into the internet advertising market.

paulsutter 14y ago
Are you willing to make a $1 bet predicting the general demise of the Internet advertising business? (I think the article called it a "collapse")? I'm having a hard time understanding exactly what concrete outcome you are predicting based on your post. Are you predicting a 1:0.9 ratio? 1:0.001? 1:1.1?
- te_chris 14y ago
  I'm pretty sure he wasn't predicting a demise, just margins that won't be as sexy.
  - michaelt 14y ago
    Well, the first line of the article is > Facebook not only is on course to go bust but will take the rest of the ad-supported Web with it. Perhaps that's just a juicy opening line to draw people in to the article - but it sure sounds like predicting a demise to me. Some of the things the article says are reasonable - but I wouldn't bet a dollar on facebook going bust and taking the entire ad-supported web with it.
    - jacques_chester 14y ago
      > it sure sounds like predicting a demise to me. He is. Of Facebook. Facebook is not cheap to run. If revenues fall and costs do not ...
- lmm 14y ago
  I'd put $1 on the following proposition: 30 years from now, the advertising industry (i.e. in which sellers of products pay directly for advertising - advertising which is not content and does not attempt to confuse the receiver about this) will have less than 1/10th the revenue it does today, as a proportion of the total revenue of all industries put together (I'd say "GDP" but I think that may be defined in terms of profit rather than revenue - and I expect margins to shrink everywhere). (I think we'll see a big rise in viral marketing, shill and semi-shill reviewing (Klout, amazon's programme where they send products to highly rated reviewers), product placement and sponsored content (the my little pony cartoons; mad men with jack daniels; akb0048), which will blur the line between advertising and content creation. But I think outright ads will collapse)