Sunday, April 10, 2016

the future of the ad industry: totally f-ed?

Why advertising is doomed, in three damning charts.

To quote the beautiful Spring Awakening, "There's a moment you know, you're f*ed". 
Have we reached that point?

That the industry, the world!, is changing is old news. The rise of digital specialists, digital agencies, specialist agencies, specialist specialists, integrated teams, trading desks, et al, et al, et al, are our reaction to this formerly new ones-and-zeroes world. But have we evolved quickly enough? A few things in the news have made me seriously doubt it.

You're F-ed, poof point #1:
Ad blocking use doubled from 2013 to 2014, and grew by another fifty percent in 2015.  Apple and Samsung made headlines this year after allowing and pre-installing adblockers on their mobile operating systems. Estimated revenue losses to ad blocking are in the billions. (Adobe/Pagefair).
Image from MIT Technology Review

With ad revenues moving switfly from traditional media to online, ad blockers will probably not kill advertising altogether, but there should be implications about consumer protection and interest that the industry must contend with.

You're F-ed, poof point #2:
I saw this video a few weeks ago and was startled by its implications, that advertising as I know it is basically f*ed. Mr. Galloway is an extremely engaging speaker who might have jumped to a few conclusions. The counterpoint to Facebook and Google are other publishers, not agency networks. We will never have the revenue that media publishers do, that has never been the case. But at the same time, the threat exists that if readership is more or less split between Google/YouTube, Facebook and Netflix (only somehwat too simplistic, see this), they can start to take on agency roles and then take those fees as well.

A clear sign that these publishers are ready to take our lunch? Read on.

You're F-ed, poof point #1:
As someone who has worked in the industry for almost ten years, this Adweek headline was depressing but also resonated with me.

"Fifty-four percent of people who left advertising said a major reason they changed industries was because they felt there was little opportunity for advancement, compared to a 45 percent global average." (Adweek) More of the findings were released at another forum: 50% wanted more challenging work, and 46% were unsatisfied with the level of senior management. (LinkedIn)

The continued move of creative talent from agencies to tech is so notable that recent coverage has talked about how agencies are "fighting back". (The answer is, not with much.)

Advertising is hard, it isn't for everybody. I've always loved the feel of our industry, "the tinkerers", as Mr. Schenck called us. The question that remains is whether this industry is still the right home for us. Maybe like everything in this crazy digital world, we need to rethink, disrupt ourselves and maybe find new applications for these skills.

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