Ad Tech’s Complexity Complex

By Brian Morrissey • July 20, 2011 •

Ad Tech’s Complexity Complex: There’s no doubt that the display ad industry is undergoing a revolution of sorts. But all this innovation is clearly coming at a cost. It’s getting hard to figure out what company does what. At Digiday’s Data Management Summit, speaker after speaker hit on the need for the techies to simplify things for agencies, publishers and advertisers — the key constituencies in digital media. Matt Barash, vp and ad director at Fobes, said on a panel that he has trouble even understanding what some companies calling on him do. John Sedlak, chief revenue officer at BlueKai, showed a presentation he gives to marketers that compares the data management platform to what iTunes did for music. This comes at a cost. Complexity means digital advertising is more expensive. Google’s display ad czar Neal Mohan quotes a stat that running an online campaign costs 14 times in overhead what it does on TV. The balance will be building systems — real-time bidding standards, for instance — that allow innovation to continue while cutting out some of the unnecessary complexity.

Time Tries Paywall: Time is trying to shed its rep as a news weekly. In fact, Time.com managing editor Jim Frederick told the Digiday Data Management Summit that the site is focused on breaking news, publishing 180 pieces of digital content every day. But like all print titles, Time is still trying to figure out its economic model. It’s now dabbling in subscription bundles that will link print, iPad and some Web content. For his part, Frederick is takeing cues from digital native publishers like Demand and Huffington Post, but only to a degree. On the much-panned “AOL Way” memo that crudely linked stories with ad views: “I couldn’t work at a place like that.”

Irrational Exuberance Alert: The worst kinds of outlandish predictions and forecasts are those that don’t come with a date. Here’s a doozy: Razorfish mobile exec Paul Gelb predicts that mobile ad spend will overtake TV. Bold. But he’s not as forthcoming with a date. It won’t be anytime soon. TV is a $70 billion business. Mobile advertising: $1.1 billion.

Stat of the Day: Twitter CEO Dick Costolo used an appearance at a Fortune conference to dispel talk that Twitter’s growth is slowing. In fact, he said users now send a billion tweets every four days.

Facebook’s Likability Problem: A new consumer survey has shown that 65 percent of consumers are dissatisfied with Facebook. That’s a big number, making Facebook markedly less liked than YouTube and other social sites. Yet Facebook has 700 million users. What gives? To some degree, Facebook is likely a victim of its own success. The dissatisfaction number should give succor to Google, which is looking to do battle with Facebook via Google+. But Google would be wise to remember that Microsoft has frequently touted that 50 percent of customers are unhappy with their current search experience. And yet Microsoft has made little headway as a credible Google competitor.

Ad Tech’s Complexity Complex

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