November 06, 2017

Steve Jobs: When Geniuses Are Wrong


In this clip, from over 35 years ago, a young, dumb Steve Jobs debates an older, wiser David Burnham, writer for The New York Times (and breaker of the "Serpico" scandal) about the potential dangers of computer spying.

This clip took place long before the idea of "surveillance marketing" even occurred to anyone.

Hat tip to the great Douglas Burdett

October 31, 2017

The Big Lie Of Transparency


Dear Online Advertising Industry,

I have noticed recently that you have become very passionate about transparency.
It seems like transparency is all the rage in the online ad world. Or maybe it would be more accurate to say that talking about transparency is all the rage.

Because I have a problem with this transparency talk. I think you're all full of shit. I think you people are loud and outraged when you can't get transparency but you become awfully quiet when you're asked to provide it.

You see, there's more to this transparency thing than the petty bickering of CEOs and billionaires. There's also the little issue of the relationship between you and us. Or does the public not figure into your idea of transparency? Is transparency only an issue when your money is at stake?

Personally, here's what I (and about 7 billion of my friends) would like a little transparency on...
  • Mr. P&G and Mr. Unilever: I'd like some transparency on the type and the amount of personal, private information about me you have been gathering with your relentless online tracking.
  • Mr. WPP: Would you mind explaining to me what you and your colleagues in the holding companies are doing with my information?
  • Mr. Facebook and Mr. Google: If you wouldn't mind, I would like to know what kind of information about me you have been revealing to your clients.
  • Ms. 4As and Mr. ANA and Mr. IAB: Just curious about who your members have been buying information about me from and selling information to? 
I hope you will prove me wrong and be open and transparent about what you've been collecting on me and how you're using it. Because it seems you're very passionate about transparency when you want answers, but not quite so passionate when you're asked to give answers.

If you're really as committed to transparency as you say you are, I would be grateful for a full accounting. Otherwise, I would appreciate it if you would take your transparency bullshit and stick it up your ass.

October 24, 2017

Top 10 Reasons Online Advertising Must Change


The current model of online advertising is only 20 years old but it is already far beyond its sell-by date. It has become a ridiculous anachronism, born in an era of naive digital utopianism, and now absurdly outmoded and unsuited to its job.

In no particular order, here are 10 reasons why online advertising must change.

1. Fraud: Online advertising fraud is completely out of control. According to JPMorgan Chase it has grown by over 100% in the past year to over $16 billion. There are no serious impediments to its continued metastasizing. The fraudsters are miles ahead of the feckless cyber-security crowd who are filling their clients full of delusional happy talk. According to the World Federation of Advertisers, within 8 years ad fraud may become the second largest source of criminal income in the world, after drug trafficking.

 2. Waste: The amount of money advertisers are wasting on online advertising is astounding. Marc Pritchard, chief brand officer of the world's largest advertiser, Procter & Gamble, says that only 25% of his programmatic budget ever reaches the consumer. The rest is wasted on non-viewable ads, fraud, and the questionable "contributions" of ad tech middlemen. When you add to that the fact that less than 10% of the advertising that does reach consumers is even noticed, you have a waste factor that is beyond belief.

3. Public Disgust: Worldwide disgust over online advertising is reaching a breaking point. People are so fed-up with the annoying, irresponsible, and relentless onslaught of online ads that over 600 million web enabled devices are currently armed with ad blockers. Every credible study ever done has shown that online advertising is the most disliked and distrusted form of advertising. The online ad lobby sold us on the idea that it would be more popular with consumers because tracking would make it more "relevant." What a joke that argument has turned out to be. In one study consumers were asked about 13 different types of advertising. The 8 most disliked were all forms of online advertising. Unless the current model of online advertising changes, ad blocking -- the mortal enemy of marketers -- will continue its unabated proliferation.

4. Effectiveness: Despite the growth of online advertising, substantial questions are being raised about its effectiveness. These questions are becoming widespread. Click rates are reported to be about 5 per 10,000 ads served. P&G announced that they had cut about $140 million in online ads from their 2nd quarter spending this year during which time their sales grew by 2%. According to The Wall Street Journal the online cuts ..."had little impact on its business, proving that those digital ads were largely ineffective."

5. Brand Safety: Anyone not comatose knows that in the bizarre world of ad tech and programmatic buying advertising can show up anywhere. Regardless of the empty promises of agencies and publishers, advertisers cannot control where their advertising appears. A comical example happened last week. An ad for the Association of National Advertisers, the body that exists to protect and defend the interests of advertisers, showed up on the big, bad, Breitbart website. The ANA, who strongly defend ad tech, looked like complete clowns when they had to apologize for "an unintentional result of a programmatic buy..."

6. Fake news: The online advertising industry is the engine that powers fake news. While most people believe that fake news is related to political operatives looking to deceive, the truth is it is also substantially the result of people looking to make money from a programmatic advertising ecosystem that rewards fraudulent sensationalism. A perfect example of how ad tech supports fake news can be found here. The fact that we have a populace that no longer knows what to believe from a media industry they once trusted is not an accident. It can be traced largely to online advertising, and specifically ad tech.

7. Degradation of Journalism: Ad tech drives money to the worst online publishers. Ad tech’s value proposition is this: we will find you the highest quality eyeballs at the cheapest possible locations. Ad tech can do this because of “data leakage.” Viewers developed by quality publishers like The New York Times are tagged and followed to crappy websites like kittylittervideo.com and served ads there instead of at the Times' website. This means ad dollars that should be going to quality publishers go to crappy publishers. Now wonder quality publishers are struggling to survive.

8. Non-Transparency: In 2017, 90% of advertisers surveyed by the World Federation of Advertisers said they intended to review their agreements with ad tech suppliers. A significant reason for this overwhelming show of no confidence was a damning report issued by the ANA in the U.S. which demonstrated that many advertisers had no idea how their money was being spent or how they were being charged for online advertising services. The more complex a system is the more opportunities there are for unscrupulous actors to find devious ways to extract money. The programmatic ad buying ecosystem is beyond complex -- it's insane.

9. Corruption: Along with the problem of non-transparency, the ANA report also asserted that corruption was "pervasive" in the online advertising ecosystem. Agencies were found to be taking kickbacks and using client money to arbitrage online ad inventory without the knowledge of clients.

10. Public Safety:  
“Today in the United States we have somewhere close to four or five thousand data points on every individual ... So we model the personality of every adult across the United States, some 230 million people.” — Alexander Nix (Chief Executive, Cambridge Analytica), October 2016.
We were taught to fear totalitarian governments. We feared they would know everything about us, follow us everywhere, track our every move, and keep secret files about us which could be used to influence our lives in ways that were only vaguely visible to us. We are well on our way to such a nightmare. Except it isn't our government that knows everything about us, follows us everywhere, tracks our every move, and keeps secret files about us. It is the marketing industry. Advertising used to be about imparting information to the public. Online advertising has become about extracting information from the public.

If we had set out to create an advertising structure that was a complete fiasco I'm not sure we could have done much better.

The online advertising industry is a preposterous train wreck that must be changed.