Archive for June 2007
Why are publishers buying Ad Agencies (DoubleClick and aQuantive)?
These deals were about technology, not the agency. Publishers will struggle to figure out how to incorporate if they incorporate at all. So my take on this is that agencies won’t go away because you still need a team that will work across the various distribution channels.
Options for publishers are to sell the agencies to one of the large traditional agencies (i.e. IPG) that are currently trying to bring the competency in-house and keep more of their client’s dollars with their business, the other is to let them operate as they are now, figure it out what it means later. Having an agency does serve as a great testing ground to help build agency tools.
These deals are indicators that the landscape of advertising taking a big swing back to interactive with traditional advertising. Past thoughts were the internet will take TV dollars, that’s not the case it simply means the internet will be part of the conversations upfront instead of an afterthought to help advertisers reach their numbers. The internet provides an extended reach that advertisers will pay for. TV is supported by advertising dollars that hinge their success on the current ratings system that at best is fuzzy math. Not sure how 1,000 black boxes in undisclosed locations represents all of America. If we used TVs ratings systems in online advertising, we would be laughed out of a meeting.
Take a look at when people were spending all this money on “eyeballs” back in the late 90’s. That model crashed and they thought the internet was doomed because it couldn’t be measured. Search marketing brought credibility back to online advertising along with the smash success of YouTube, MySpace and Facebook. Don’t forget traditional media has played a big part in these sites being successful. My mom knows about MySpace because she saw it on TV, not because she was looking up people’s profiles.
The power of the internet is content. Leaders of this industry will be those companies that either own the content or can provide the tools that deliver them. And being able to monetize that is the key to all of it.
