Future of digital advertising: consumers and advertisers need a new deal

The sale of the Financial Times marked an important milestone in traditional media continuing it transformation into the digital world. Many commentators have cited the price as evidence that paywalls can work. But it should also be seen as an indication that data is becoming a fundamental part of the content and publishing world. This is because as publishers erect paywalls, they gather two assets; revenue and data. Both of these help to pay for the content that we consume when we land on that publishers website.

Data is the reason most of the content on the web is free – because we effectively trade the data that we exude on those platforms, for a service that we don’t have to pay for. The audience is the product, not the content. It’s important to note though, that this isn’t a new concept – our behaviour has always been sold to advertisers, which drives revenues to produce more content. Advertising has, for a long time, funded the content that we consume for free and in the case of most magazines and newspapers, we actually pay to consume.

Advertising technology, however is a slightly different beast. What has traditionally annoyed people about advertising hasn’t been that it’s been invasive (although I agree with Salmon, there is a special place reserved in hell for people who run those incessant, high-frequency retargeting programmes). What’s annoying has been the fact that a lot of advertising speaks to the wrong people – broad media titles carry broad audiences, and so the advertising, by proxy, ends up being broad. Out of an entire newspaper, an individual might only actually find a handful of adverts interesting. The same goes for television, radio and, in the past, the internet.

Most people don’t necessarily understand (or probably want to understand) what actually happens when they type out an address in their browser. Advertising used to be as simple as (and I’m not joking now) calling up the media owner (a newspaper, a magazine, a television channel etc), agreeing a price and a placement and then sending over the advertising creative. The advert would be printed or placed and then the media owner would report back on how many people had seen the advert. It was a simpler time.

Read the full article here.

Source: theguardian.com

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