Sunday, March 22, 2009

The Internet Destroys Advertising

That's the subject of a controversial article at TechCrunch.

The most novel bit wasn't that consumers have more ways to defeat internet ads, though they do, or that consumers ignore puhsed ads, though they do, but that the internet kills the value of advertising in all media.

What socially valuable purpose do push (unrequested) ads serve? Let's set aside the cynical view of an advertiser engaging purely in psychological manipulation, and consider the value ads really contribute.

Ads can inform consumers about products those consumers wouldn't otherwise be aware of. Ads might also allow the consumer to make an inference about the relative quality of a product, based on how much a company is willing to spend to attach their name to that product.

Finding unbiased information about new products is fast and easy. Consider all the product rating sites (Ratebeer and TripAdvisor are mentioned in the article). This facet of the internet almost completely effaces the need for advertisements on television or in newspapers.

The piece on TechCrunch concludes that the Internet will move towards more pay content, which I think is misguided, since the Internet also makes downward price competition very easy. (Was it the Guardian or the Register that was hoping NY Times would move closer towards a pay model for online content so they could become the most cited paper online?) But this does raise many interesting unaddressed questions about what the future of television advertising looks like, thanks to the internet.