On the Nature of Advertising Technology

I’m back in San Francisco after a whirl-wind two weeks through New York City and a notable stopover at the Ad:tech conference. As I go through the various brochures and business cards I collected, thinking back on the panel discussions and presentations I sat in on, there’s a consistent theme that keeps popping up. That theme is the competition among tech-focused marketers who are creating networks designed to reduce friction in the system (the various types of networks and ad exchanges that deliver cheaper impressions faster), and the people-focused marketers that are working to increase effectiveness by adding friction back into the system (the social networkers that want to return to a one-to-one utopia). In my humble opinion, both are totally nuts.

An ad delivery system that is completely frictionless doesn’t work. For an ad to work, it has to insert itself in the consciousness of the consumer somehow–otherwise known as friction. All these tech guys that are hell-bent on creating a frictionless system do so with the underlying bias that advertising is evil, and needs to be gotten rid of. I can kind of empathize. However, the model they base their projections on are based on current effectiveness benchmarks that are only possible to achieve in high-friction system. Using that data to project results in a totally frictionless ad-exchange market makes as much sense as basing your mortgage repayment model on data that says jobless deadbeats will repay loans at the same rate as wealthy people. We all know how that ended.

On the flip side of the coin, the social networkers don’t understand the concept of scale. The only way it makes sense to have a one-to-one sales relationship is if the ratio of the total universe of possible buyers to sales people is ~ 200:1 or less, and the price tag of a handfull of sales can make the organization profitable.

There have to be nested, symbiotic, automated layers of marketer-consumer contact that maintain a positive tension between buyer and seller that is always appropriate to the buyer’s point on their path to purchase.  I’m kind of seeing this from some of the automated marketing shops, but nobody out there is trying to sell me an end-to-end solution that makes sense. Even Google tends to err on the side of the frictionless engineers as they’re rolling out their new display network. Where’s the vendor out there that’s selling a solution that combines the lubrication of software with the friction of meat-ware? Can’t we all just get along? Engineers and social media folk, go hold hands and take each other to lunch and tell each other how great the other is. You’ll be better off for it.

Urban Dictionary

meat-ware:

The human element in a technological system. The hardware is the system, software runs on the system, the meatware is the user of the system.

The hardware and software are both fine, the problem must be with the meatware.