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Wed 30
Apr
2008

Advertising Next

What Max Reckons Surely advertising is the world’s most inefficient industry. Here are people who will plaster a bus with a ten-foot-high pop-out poster of a giant on the off chance it will encourage you to have your carpets cleaned.

Let’s walk through this process. For the ad to work, you must (a) notice it, (b) pay sufficient attention to absorb its message, (c) attach sufficient credibility to not immediately dismiss it, (d) retain that message until you enter a purchasing situation relevant to that product, and (e) find the message so persuasive that it alters the purchasing decision you would otherwise have made.

The chances of this are infinitesimal. And so advertising spams. It makes five hundred uninterested TV viewers sit through a 30-second spot in case one of them is in the market for a new SUV. The amazing part is that this is actually cost-effective. Advertising is a half-trillion-dollar industry that makes commercial sense even though most of its output is wasted.

Far more sensible would be if advertisers could restrict their ads to people likely to respond to them. They’d save bucketloads of money; we wouldn’t have to sit through ads for products we wouldn’t buy in a million years.

This yawning gap between the present state of the advertising industry and one that isn’t completely freaking insane means there will be change. Market segmentation has always been a big deal in marketing, but it’s getting huge. Marketers are ravenous for information about you, and they’re building immense data stores. These will enable them to tailor their messages to you—or, at least, to your market segment. In the short-term, it’ll mean more relevant ads, Google-style. Next, I think, comes more persuasive ads. That’s when they change not the product being advertised, but the message: playing up its green credentials if you’re environmentally conscious, its patriotism if you’re nationally minded, and so on.

Lately I’ve been thinking about my ideal state of advertising. And I don’t think it’s no ads at all. I would prefer no ads to the tidal wave of irrelevant ads I get currently, but in a perfect world, I do want information about products. Specifically, I want unbiased recommendations from people I respect and admire. That basically means friends and select celebrities. I want this to be “pull” information: I don’t want anyone randomly coming up and yakking about their amazing new phone. But if I’m thinking about a new phone, I’d like to be able to see what people with whom I identify think. I would like to browse through a list and see that Wild Pete has a Nokia but it sucks, Wil is wedded to his Motorola, and Stephen King knows where you can get a good deal on an iPhone.

The closest thing I’ve seen is Facebook. It’s all push—I get recommendations and links thrown at me whether they’re relevant or not, and almost entirely they’re not. But still, it’s socially-based purchasing advice. I think if Facebook had been smarter—if they’d remembered their success comes from giving people complete control over their own information, and hadn’t tried to wrest it back—they could have built the most effective, highly-targeted advertising platform in the world. Maybe they still will.

Until then, I’m skipping TV ads on my PVR, blocking them on the web with my browser, and listening to commercial-free internet radio.