The next 5 years will hold more change for the advertising industry than the previous 50 did.
The information for this post is from an IBM global surveys of more than 2,400 consumers and 80 advertising experts … the report is titled, “The end of advertising as we know it.”
Imagine an advertising world where ... spending on interactive, one-to-one advertising formats surpasses traditional, one-to-many advertising vehicles, and a significant share of ad space is sold through auctions and exchanges. Advertisers know who viewed and acted on an ad, and pay based on real impact rather than estimated “impressions.” Consumers self-select which ads they watch and share preferred ads with peers. User-generated advertising is as prevalent (and appealing) as agency-created spots.
Based on IBM global surveys there are four change drivers shifting control within the ad industry:
- Attention – Consumers are increasingly in control of how they view, interact with and filter advertising in a multichannel world.
- Creativity – Thanks to technology, the rising popularity of user-generated and peer-delivered content, and new ad revenue-sharing models (e.g., YouTube, Crackle, Current TV), amateurs and semi- professionals are now creating lower-cost advertising content.
- Measurement – Advertisers are demanding more individual-specific and involvement- based measurements, putting pressure on the traditional mass-market model.
- Advertising inventories – Will be bought and sold through efficient exchanges, bypassing traditional intermediaries.
There is no question that the future of advertising will look radically different from its past. The push for control of attention, creativity, measurements and inventory will reshape the advertising value chain and shift the balance of power.
Change has been a part of our industry but the changes we are seeing now are coming more rapidly than ever before. These changes in communications technology also greatly impacts agency new business practices. So far agencies have been slow to adjust.
September 25, 2009 at 2:30 pm |
I really enjoyed reading this post, and thank you for the great resources.
Best Regards,
May
businesssprouts.wordpress.com
September 25, 2009 at 2:33 pm |
Thank you May. Very much appreciated.
September 26, 2009 at 10:25 am |
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September 27, 2009 at 12:01 pm |
I agree on all fronts – especially on the measurement aspect
it’s quite unbelievable that so little advertising is trackedwith all of today’s technology…
September 27, 2009 at 12:35 pm |
Thanks Ben.
September 28, 2009 at 9:30 pm |
Michael Gass is one of my top resources for great information these days. He is to advertising what Guy Kawasaki is to entrepreneurs
September 28, 2009 at 9:34 pm |
Chuck, that’s very kind of you.
October 2, 2009 at 9:14 am |
[...] See the original post here. [...]
October 6, 2009 at 10:15 am |
This is what all the so called experts were saying 5 years ago too and it hasn’t happened. ROI and billing and fees for service along with ROI based commisions were all the talk 5 years ago……Guess they still are….I doubt very much things will change as they say………..
October 6, 2009 at 10:38 am |
Kline, I agree that its been the talk for awhile but I think we’re seeing some definite changes. On the client side you have companies such as P&G, McDonalds that are forcing agencies to change their business models, fee structures. They are demanding accountability and more skin in the game. Agencies are also being forced to specialize, they can no longer be everything to everybody and survive. Talking with dozens of agencies a week over the past two years, there’s a dramatic change in our industry.
October 6, 2009 at 12:35 pm |
Social Media interest is where Internet interest was twenty years ago. It’s a huge test market and ad agencies are obliged to conform. Silly investment is creating another dot com bubble. All social media does is further dilute credibility control, making it even more difficult for small businesses to succeed and for news outlets to form opinion. The Power of monopolized media research is even changing history. Traditional print and broadcast media will always be needed to maintain any credibility for advertising or politics.
October 12, 2009 at 2:05 pm |
It seems to me that the rush of change in our industry via social networking has many of us wondering:how will we generate the kind of profits it will take to sustain our companies during this period? Is anyone making any real moneynow?
Haden Edwards
October 12, 2009 at 2:18 pm |
Haden, that is definitely the question that must be answered. Most agencies can’t wait even 6 months to figure out how to make monetize it, they need to be generating leads ASAP and figure out how to charge for new media. A good example of an agency that is generating income during this time is The Russo Group, Layfayette, LA. Jaci Russo says their profits are up over 104% over last year and the last I heard they’ve added their 13th account since the first of the year.
October 16, 2009 at 11:09 am |
Changes don’t take place as fast as most studies usually project. Regardless, this was a great quick and interesting read. I would love to see more on the topic!
November 23, 2009 at 11:20 am |
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November 24, 2009 at 5:01 pm |
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January 25, 2010 at 4:39 am |
It is interesting to see how rapidly the Social Media fire spread, and how much it is impacting all kinds of businesses in such a short span. But it is important to know how many of them actually know how to implement it. Today there is so much junk on the internet in the name of social media that the actual information is getting lost. I agree social media is very beneficial and is here to last, provided we use it the right way. I would be wrong to say that conventional marketing will vanish, in fact it will be stronger with the help of social media. These two channels are symbiotic in nature.
January 26, 2010 at 5:01 am |
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February 2, 2010 at 10:48 am |
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