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University Professor Condemns Online Advertising To Fail
By Anna Johnson on March 28th, 2009Eric Clemons, Professor of Operations and Information Management at The Wharton School of the University of Pennsylvania has written a controversial essay in TechCrunch arguing that online advertising is not trusted, not wanted, and not needed.
Professor Clemons says that the recent decline in advertising revenues is not solely a function of the recession, but a sign of things to come. Online advertising will, he argues, rapidly lose both its value and impact, largely because people don’t trust, want or need it.
So where does that leave Internet marketers trying to reach their audience? With other monetization models, says Professor Clemons.
They can sell real things online, they can sell ‘virtual’ things – such as content and information – or they can sell various kinds of ‘access’.
Check out the link below for Eric Clemons full argument, but I find it unconvincing. It’s all very well to present alternative monetization models for a business… but how do audiences find out about that business in the first place?
If no-one is inviting a new business into their head (i.e. when considering a purchase)… how does it invite itself?
In other words, how do you sell a product or service to someone… without them becoming aware of you in the first place?
Sure, there are means of getting attention other than advertising, but they are not necessarily more effective in generating the most targeted audience.
And what about the ‘culture of free’ that is so pervasive on the Internet? So many people have come to expect, if not real things, then plenty of virtual things, as well as certain kinds of access, for free. They often do so in return for agreeing to being exposed to advertising.
That’s not to say that online advertising shouldn’t evolve, or isn’t evolving, and I should say that my definition of ‘advertising’ may differ from that of Professor Clemens.
Clemons’ definition of advertising seems to be focused on interruption based messages that are placed on content websites in return for payment… rather than ‘invited’ messages (e.g. emails) that people voluntarily sign up for.
That’s a fair distinction, and on that basis, you could argue that (a) there are many options for getting a message out other than paid-for advertising on content websites, and (b) those options are often more effective.
But, even on a narrow definition, I wouldn’t rule out advertising from evolving and remaining somewhat useful to Internet marketers and audiences alike.
There are just too many people – advertising agencies, publishers, advertisers, etc – with a vested interest in seeing that evolution take place…
Source: Eric Clemons, “Why Advertising Is Failing On The Internet,” TechCrunch, March 22, 2009
March 28th, 2009 at 9:05 am
It’s a good thing that Professors at Universities don’t have any governing authority whatsoever for online business.
His argument isn’t trustworthy or credible and the reason there have been billions of dollars
successfully invested in advertising online is because people do trust the companies they purchase from and because real needs are being met.
That essay may have put a little feather in the professors hat or an extra teaspoon of smug in his coffee, but won’t stop advertising on the internet one bit.
It appears our dear Professor hasn’t read enough of the Kikabink newsletter yet to learn
the only advertising condemned to fail online are the ivory tower predictions of irrelevant
dormitory CEO’s.
March 29th, 2009 at 10:22 pm
I’m sure somebody said much the same thing about advertising on TV or even radio during their early days. Mr. Professor needs to check history before he presumes to see the future.
April 4th, 2009 at 1:17 pm
When compared to traditional advertising it becomes obvious the objective of marketing.
Marketing is not what generates a sale or closes the sale. Marketing in any business is to attract a potential customer.
It is the responsibility of the business, be it bricks and mortar or online to close and complete the sale.
So the question is, will advertising decline? Well to answer that question then simply ask yourself, does your business still need a flow of potential customers?
If there is a replacement for advertising, online or offline, then maybe.
Sure businesses have tighter budgets now, but should they increase their potential customer flow or let it dwindle in times of recession?
Simple answer, never let the customer flows dwindle. Cutting costs and expenses is important when revenue drops, but cutting expenses will not cause revenues to increase. Only increasing customer flow or web traffic will.
Cost per click and Cost Per Action Online Advertising is a wiser investment now more than ever as businesses begin to measure the quality of marketing efforts and the ROI.
July 17th, 2009 at 8:25 am
Thought this might interest you — http://www.youtube.com/watch?v=pHAyskfW6sU
Excellent opening for class
July 17th, 2009 at 9:15 am
Hey Karen – does it make me a bad person if I said ‘yes’ to all those things in the video… or just a libertarian?