Business Models

Why Web Ads Suck

I’ve been researching and writing about the advertising business model for a while now, and for one simple reason: I hate online ads. They suck.

And yet, I’ve come around to believing that despite its flaws, advertising is only chance we have of making any real money off the internet. Or, to paraphrase Winston Churchill, advertising is the worst business model for the internet, except for all the others that have been tried.

Brian Morrissey of Adweek asks Are designers to blame for bad Web ads?

There are any number of reasons that web ads are terrible, but most of them sit far upstream from the beleaguered agency art director asked to churn out banner ads each week.

Advertisers Don’t Spend Enough
If you want better online ads, why not pay more for them? When you pay more for something, you often get better quality. CPMs for online ads are between 1/7 and 1/10 of print ads. That means that for every dollar an advertiser like Chanel will pay to get my attention in a magazine, they’ll pay only a dime to show me something online.  Do you expect to get the same quality from your $10 sushi from Whole Foods as you would get if you spent $100 at Nobu? It’s a chicken and egg problem — advertisers want to see better returns before they will spend more — but the advertisers will have to start paying more before quality will improve. Lower CPMs are the main reason that traditional media businesses are floundering; even if publishers devise a somewhat-palatable way for users to pay for content it still won’t make up the difference.

Measurability is a Double-Edged Sword
The saving grace of web ads — measurability — is also their downfall. Publishers tout measurability as a key reason to shift to online media, yet the metrics used to evaluate success are too simplistic. Click-through is a terrible way to measure people’s interest and engagement. People will click more often on things that are annoying, but that doesn’t mean they like the ads. Take the example from those subscription cards in periodicals (“magazine seeds”) which were previously the most intrusive form of advertising known to man, before the invention of Eyeblaster. Subscription marketers know that if you put five cards in a magazine, you’ll get more subscriptions than if you put four cards in — regardless of how much you annoy the people who don’t subscribe. Similarly, the more irritating you make your ad, the more likely it is someone will click on it. If that seems like a flawed way of doing business, don’t blame the designers who are encouraged to make obnoxious ads. Blame the system that focuses on click-through metrics to the exclusion of more meaningful evaluations. (If you still think that measurability is the end-all-be-all of the internet, and you haven’t read Doug Bowman say Goodbye, Google, now would be an opportune time.)

Industry-standard Sizes are Too Constraining
I’ve designed sites for dozens of newspapers, magazines, and blogs, and I can confidently say that having a limited palette of ad sizes (and thus grid structures) to work with really constrains your creativity. The only ad format anyone wants to buy is a 300×250 rectangle. The IAB and other industry organizations put Soviet-style pressure on publishers and advertisers to force them to conform to a single standard. The argument for standard sizes is that it widens adoption, since advertisers are assured of being able to place their banner on as many sites as possible. In practice, it retards growth, because sites are unwilling to branch out to new formats. I’ve been advocating the half-page ad (300×600) for years now, but few sites have re-architected to support it, and so agencies don’t design for it. I asked one client why they didn’t run more of the larger ad size, and he replied “We can’t run it unless 12 of our competitors run it. And they don’t.”

Advertising is About More Than Awareness
Much has been said about how the traditional marketing funnel has been turned sideways and inside-out by the internet. Not enough has been done to educate clients and creative teams about how to change the way they work to engage and persuade people throughout the transaction funnel. Everyone still focuses on banner ads and microsites, which are the equivalent of bus sides and TV commercials. Says Bob Greenberg of R/GA in Art & Commerce: Funnel Clouding (also from Adweek):

I suspect the reason agencies haven’t tackled consideration and preference is because they are far beyond their capabilities rather than simply outside their comfort zone. Real engagement requires entirely new teams of people—like information architects, data analysts and an army of technologists of various stripes. The traditional teams found at agencies simply do not possess the skill sets needed to tackle areas that are deeper inside the funnel, where purchase decisions increasingly take place.

You get flashy, glossy microsites because you’re dealing with an industry of advertisers and publishers that haven’t had a chance to develop and assimilate a new set of values. The digital agencies are schizophrenic, emulating backwards as often as they strive to set new standards. And the cult of measurement ensures that content, tools, and guidance that go beyond mere banner click-through just don’t “count.”

Is it any wonder that online ads suck? Frankly, I think it’s a wonder that agency designers do as well as they do.


10 thoughts on “Why Web Ads Suck

  1. In so many ways you’re stating the obvious that so many refuse to see. I’ve been trying to change peoples minds on ad sizes and placement for awhile and its difficult, very difficult.

    Honestly, there appears little interest in doing so. People(agencies/?) want numbers on paper and not actually concerned (for good and bad reasons) on how successful the ad actually is from user experience perspective and how that could make their message more meaningful.

    With few exceptions (some Apple campaigns and others), web ads have never been thoughtfully implemented since the formats are broken (IMHO).

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  3. Bad coding causing browser lock-ups is more annoying than anything. Imagine magazine inserts that explode when you detatch them — Not just an annoyance, but a Real Buzz-Kill.

    Short of Acrobat PDF, all the other “rich media” (Flash, QuickTime, CSS, Java/script, yada yada yada…) have compatibility problems of one sort or another; and since there’s no regulatory authority like the FCC did during the Color TV and HDTV roll-outs a half-century apart.

    Here’s a History Lesson for you Internet Kiddies: This is the announcement on NBC of NTSC-compatible Color TV all the way back in 1953. If you remember anything about broadcast technology history,you’d know CBS and RCA/NBC were in a race to be the Color TV standard. CBS’ effort was a multi-million dollar disaster, because it was not compatible with the Black & White TV’s already in peoples’ living rooms.

    Sound familiar, as you hunt down why customers’ browsers are frozen from supposedly slick programming?

    Here’s the 2-1/2 minute video, from the 1953 Sid Caesar Hour live show:

    Note well the reference to “Social Media” at the 0:35 mark. But, watch it all.

    PS: When I was a co-op Electrical Engineer at RCA, I was mentored by some of the same people who brought you the Magic of Color Pictures Flying Through The Air, arriving clearly in Your Living Room.

  4. Hey Karen, good twist & I do agree with you. Like I said to Brian, we have created a rod for our own back and need to offer “some” kind of measurement – but clicks are for search and limited value in display. They are thorn in the side that is crippling online ad spend – and as Eyeblaster drive’s media-neutrality and cross-channel accountability, a click, the last-click – even Interaction Rate – all have serious floors. Yet we know that for offline measurements like GRP too, but the fact is someone has to offer “something”.

    My own research over 1.5 billion ads is showing around 10% ads are touched and played with for one minute. That is NOT saying online ads suck, quite the contrary – people will roll-out in disgust if they did not like the ads. The fact is there are many amazing concepts out there that have fantastic results – just not necessarily clicks.

    I could discuss Pepsi’s Refresh Everything campaign with Obama, that drove video uploads to YouTube in a banner – 14% of all uploads came through the banner. Or Intel having a B2B2C real-time discussion with chat in a banner to student in Malaysia, Russia, etc from Chicago… Or Masterfood’s generating 35,000 Sales leads in a single day for launching Mars Planets, or Orange getting 500 people to pass over bank account details as part of process to sign up to a mobile contract in return for a free phone… these are ALL doen through interactive display advertising.

    People who think display advertising doesn’t work have not seen the data – or are misaligned and focused on clicks and missing the big picture.

    That said, I agree with you – most online advertising sucks, is a poor afterthought to the microsite – and these designers need educating into advertising

  5. Dan – not a pitch, but a case in point – think you will find that Eyeblaster, who serves the largest number of Rich Media ads globally, is MRC/IAB accredited. That means “fully audited” by two independent authorities, and as such Eyeblaster are the only ad server acredited over all three standard display, rich media & online video.

    Rich Media systems can also target by OS, Connection Speed, Monitor resolution, etc, etc, etc – and all publishers have virulent specs and generally test creatives. It cuts down practically all those early frustrations. Things have moved on a lot in 10 years…

    And if you are keen on history – feel free to check out;
    Online Advertising History: Flash by name, Cookies by nature

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  7. While agree with everything you point out in terms of problems with display ads online. I do have to take some exception to your assertion that advertising the only way brands can make money online. I think it’s the only way ad agencies understand to talk about brands. When all you have is a hammer…

    Again, I agree there are many opportunities to improve the structure around display advertising, but I think we as an industry will need to come to terms with the dynamics that surround the web as a social construct and recognize the opportunities they present. Once we get ourselves outside the ‘campaign’ and ‘slogan’ mindset, the web provides a limitless platform from which we can create actually meaningful experiences for the customers of the brands we work for.

    Until then, I think we’re ultimately fighting the same battle publishing is: trying to push a product (advertising) that people don’t want, on a platform that doesn’t require them to just accept it.

  8. Maybe people should look less for dimension and more for purpose. Just look at ‘Art Forum’ for example, a print magazine on art completely full of ads, yet the ads are meaningfull within the magazine’s context – the next good shows (it has purpose). That’s a different business model within the ad market..

    I personally don’t even look at ads on the web unless they have some meaning besides spreading a ‘product’. I think people are hungry for purpose… And brands did not get that yet, they keep spreading values that are not anymore on the common people…

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