The Web is not an "advertising" medium

by Terry Heaton
December 18, 2012

More is coming into focus on one of the core thought principles of my work with regards to the difference between the offline and online worlds. It leads me to the conclusion that the Web isn't an advertising medium, at least as advertising is currently defined and practiced. It's just not, and Madison Avenue is going to have an increasingly rough go trying to reinvent itself for the Web. You probably think I'm nuts, so let's talk about it.

I'm a media guy, so this is about ad messages that in some way accompany the kind of content that legacy media companies make. It's either adjacent to content or interrupts a broadcast stream of content. That's what most people recognize as "advertising." Of course, there are a million other varieties — some of which are blossoming — but I'm talking about garden variety advertising.

As you've read here before, I believe that newspapers' original sin regarding the Web was to invent its online self in its own image. "Vanity of vanities, saith the Preacher. All is vanity." The problem here is that newspapers didn't invent the Web; geeks did, and that brings into play an important second point. The back end of a web "page" — the source code (oh, and they're really not "pages," but that's another story) — is more real and therefore more important than that which people see. Legacy purveyors of news and information on the Web only examine what it looks like, not how it behaves. Take a medium that works apart from the Web and copy it onto the Web, and you've already completely missed the point of what can — and better, what should — be done. Well, Terry, it LOOKS like a newspaper, so why shouldn't it FUNCTION like a newspaper? Why? Because it isn't a newspaper (slaps head).

Here's a combo-image showing the home page of the New York Times website. On the left is what people "see," and the right is the source code that produces the image on the left. Click to embiggen, as the Simpsons gave us and the geeks adopted.

Front and back ends of

Whenever I use this in presentations, I ask the audience which is more real, because the truth is that the Web is a series of encoded documents, and the end products that we see and use are merely representations of items that exist in time and space. This is why things that function one way in the offline world function completely differently in this network of encoded representations. I believe we will one day discover the equilibrium that businesses so desperately need online, but it won't happen — no matter how hard we try — by only addressing those representations.

Despite years of warnings from, among others, Web usability guru Jakob Nielsen, that banner ads weren't working and wouldn't work, newspapers (and yes, TV stations) have been hellbent on duplicating themselves online in order to present, yes, banner ads. This is where the confusion begins, for the real business of legacy media is the creation of audiences, not content, and the back end of the Web — the network — doesn't neatly create audiences. Offline, the stage speaks one-way to the people in the seats, whereas the network is a 3-way communications medium: up, down & sideways. You don't see that by thinking of those lovely end products, because it's only visible via the back end. This is why I honestly believe the disruptions of our second Gutenburg moment have just barely begun and that the next hundred years will be among the the most exciting yet difficult in the history of humankind. Absent intervention that nobody really wants, the network will decimate hierarchical institutions one-at-a-time, until a new hierarchy is created from the rubble of what was the modern era.

Moreover, if your knowledge includes the back end, you understand how easy it is to block all sorts of ads, pop-ups, pop-unders, Flash, javascript, and so on. The back end also reveals what is impossible to see while examining only the front end — that the eyeballs viewing it aren't captive. Web media will NEVER duplicate legacy media. Never. It's an entirely different ballgame.

The geeks built the Web (and I smile a loving smile when I say that). They also built the mechanisms for communicating via the Web, yet media companies still behave as though it's only a utility for the extension of their brands. Fine. It "can" work like that — but only up to a point, and that's the wall many are hitting today.

Mary MeekerAdvertising is a mass marketing process, whether the mass is a few passersby on a street that stop to read the sign or to hear what the guy on the soap box has to say. It's also the reaching of huge audiences, like magazine and newspaper readers or those watching television or listening to a radio broadcast. To the extent that direct marketing is a form of advertising, you could say that the Web "works" for advertising, but the problem is that media companies don't think this way. Everybody does email marketing, but that's just considered a niche for media. Media's core competency is the creation of audiences for advertisers. The Web? Well, it's just not very good at that. I mean, mass marketing is alive and well, but it will never be a really big, profitable business on the network. Those who spend their time and resources trying to fit their square pegs into the round holes of the geeks are losing before they even start. As Mary Meeker noted in her recent new year end report, "2013 will be the year of re-imagining everything." That includes advertising.

Messages to people from businesses that cater to them are increasingly content-oriented. As a result, content Marketing is exploding, as more and more of the people formerly known as the advertisers continue to explore the networked world. Here are two new slides from Joe Pulizzi of the Content Marketing Institute. The left image is where B2B marketers are projected to spend next year's money; the image on the right is B2C marketers.

Content marketing 2013

Content marketing is also known as "native advertising," something that a study by Solve Media reveals is going to be tried by half of all media buyers in 2013. Solve Media CEO Ari Jacoby told Paid Content that "Itís not a trend, itís a reality."

You might argue that I'm just making a semanticist argument, but we badly need clarity in this area before we can figure out what works online for the people who used to be our advertisers. The term "ad money" is being redefined right before our eyes, as advertisers discover more ways to reach people apart from the legacy platforms they used to need so badly.

Gordon BorrellOne man who sees this clearly is Gordon Borrell, whose Borrell Associates has been tracking local online advertising — in all its forms — for the past 11 years. Borrell also hosts conferences that bring media company executives together with people who are disrupting them, which is the theme of its coming conference in March. Borrell projects online revenue to grow from $18.7 billion today to $51.1 by 2017.

Advertisers are slowing down their expenditures on online "advertising" and plowing money instead into online services like SEO, reputation management, social media management, email management, etc. These are all "utility" marketing services, not actual advertising. I'm guessing that the Internet is now moving into a phase where itís disrupted all of the traditional advertising it can, and is now disrupting other non-advertising marketing channels. Expect the amounts spent on traditional channels for design, brochures, public relations, flyers and pamphlets, agencies, etc., to be shifted over to companies like ReachLocal, Yodle,, Marchex, HubSpot, and others. These guys have become classic "disruptors," which is why I've themed our March conference that way.

Money spent by the people formerly known as the advertisers is pouring into the Internet but in ways that media companies really can't see. That will require an effort at reinvention or the "reimagination" of Ms. Meeker.

My advice is what it has always been: Learn to see the Web as a completely different communications mechanism, one that requires different value propositions and competencies. Local media companies CAN compete — especially those with television stations. Why? Because for all the unique values that disruptors bring to the marketplace, they don't own a mass marketing vehicle like a TV station, nor do they employ locals who know the ins and outs of the community through means deeper than what google searches can allow. These provide enormous competitive advantages for us, if we could only bring ourselves to see them and act upon them in building a future in our increasingly postmodern world.

One final word about the types of companies that Gordon mentioned above. These are your competitors, not your friends, regardless of how their welcoming hands are extended in your direction.

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