In Silicon Valley, and among startups in general, there’s a single slide that encompasses an article of faith. It was created years ago — and is updated annually — by famed Internet-analyst-turned-venture-capitalist Mary Meeker. It shows the gap between time spent on the Internet and ad budgets spent.
The graph is correct, but the underlying assumption that this gap would magically close is a lie, said Rick Webb, a partner at VC fund Quotidian Ventures and a co-founder of digital agency The Barbarian Group. The reason is simple: Brand advertising online sucks.
“Here we are 10 years later, and the money hasn’t come over,” he said at the Digiday Brand Summit, in Deer Valley, Utah, on Monday. “TV viewership is declining, but TV ad spend has gone up. It’s because TV ads make people cry and make people laugh … and the Internet doesn’t grasp that.”
Webb, who advised Tumblr on its ad strategy and is doing the same for streaming platform SoundCloud, said startups and platforms should focus on solving that problem for brands. That’s the only way to unlock big budgets.
“There’s a million different Internet companies you can spend money on,” he said. “It’s kind of a joke. Nobody in this room has the time to talk to all 50,000 tech startups. If you want to break out [as a startup], give some plausible way to do great brand advertising on the Web. What can you be to [marketers] that’s actually moving like brand advertising?”
Watch a three-minute clip of Webb talking about the subject below.
More in Marketing
Women’s sports marketing boom ‘huge up and coming opportunity,’ spurs new agency services
Women’s sports are having a moment. Brands, media companies and agencies are looking to get in on the action.
Creators still turning down work as the Hollywood SAG-AFTRA strike continues
The Hollywood strikes were supposed to be a game changer for many of them, but the situation hasn’t quite lived up to the hype.
Agencies move on from creating content for specific platforms to focus on short-form video
Given the rise of short-form video, agencies that focus on the format, rather than specific platform expertise, will reap the rewards.