I found this interesting article by Don Marti about privacy and what would happen to marketing budgets the day users’ privacy were respected at long last.
I like how Don classifies ads in three groups: ads against search results, based on intent; contextual ads based on content, which can be thought of as similar to ads on magazines; and ads based on identity, on who the user is. These ads are bought wherever it is cheaper to buy them, and they are indeed very similar to direct mail spam.
All fine, except that there’s a missing variable: the format of the ads.
Ads on search engines are textual. They were presented as a form of direct marketing based on intent from the very start, as the yellow pages of the Internet, if you wish, and they perform very well for both those who sell them and those who buy them.
Banner ads, on the other hand, have been a mess for a quarter of a century.
They were never presented as the new form of magazines ads, and for good reason. The format is small and terrible, and it is very hard to use banner ads to get a message through. To make things worse, creativity has always been an afterthought at best.
Click rates were very high on the very first banner ads, starting with the one that appeared on Wired in 1994. This led to the very wrong idea that Internet users were so interested in companies and their offers that they would want to interact with these ads.
Hence, the IAB.
No, not the Internet Advertising Bureau, but the Interactive Advertising Bureau.
Too bad that today that interaction can be measured in little more than a click every thousand impressions, or about 1/50th of what the click rate for search engine ads is.
Banner ads are the biggest failure of the Internet, ever. This is why ad-tech companies have been able to sneak in and track our every move to try to sell a terrible format.
Privacy-enabling tools are a great step forward to limit the data collection abuse and the flight of marketing budgets from legitimate websites to nobody knows where.
But I doubt we will be able to win this battle unless we undo the mistake that opened the way for ad-tech companies. The banner ad format is a failure and it must go.