A little over a year ago, I took my first job in an industry that my peers in the media business and I used to consider the "Dark Side," advertising software and services. However, for the thirteen (lucky) years prior, I was the customer working for interactive divisions within very large media conglomerates. As such, I have been following with great interest the frustrations expressed by media companies, primarily print-based, against the "parasitic Internet technology companies" such as Google.
Based on a unique familiarity with both sides of the traditional and online media struggle, I have witnessed the beauty that can be created when the marketing mastery of traditional media intersects with the spirit of innovation inherent in the interactive space. Yet, I see the untapped revenue potential of savvy ad salespeople, within organizations at which they principally hone their skills in print or television, as they fail to leverage the expansive flow of consumers finding their traditional content via Google. Unfortunately, most of these ad sales teams have been left ill-equipped from a personnel, training and tools perspective to take advantage of this ample opportunity. Google and others in the search or online news consolidation space are not to blame for this.
You might trace the birth of Internet advertising to 1994 and HotWired, which at the time was a corporate cousin of ink-and-paperWired magazine, and ever since, traditional media companies should have been well positioned to be leading generators of interactive ad revenue. Just look at the founding mothers and fathers of the Internet Advertising Council (predecessor to the IAB) in 1996, and AdMonsters (an association of online advertising operations and technology professionals) in 1999, and you will see pioneers associated not only with Wired but with "old media" firms such as Time Warner, Discovery, ESPN and the Washington Post.
So what happened? Unfortunately, there were too many well-established factions within many of these companies hoping for the day that this "rounding error" of a business would just go away. Based on premature assumptions and self-fulfilling prophecies, many used the bursting of the Internet bubble in 2001 as the excuse to neuter their in-house interactive initiatives, which they didn't quite understand and often feared. As a result, innovative online companies, though often initially ignorant and awkward when faced with buyer relationships and other nuances of the ad sales business, have swept in to dominate interactive advertising as it has recovered robustly, growing into a $20B+ business.
What would have happened if these traditional media companies had the perseverance to evolve properly equipped to turn their digital "dimes" into "dollars" during the years since the Internet bubble burst? Sure, folks like Google and Yahoo! would still be primary drivers of the interactive advertising business. However, it is my belief that traditional media companies, with their superior advertiser/agency relationships and marketing acumen, would be seizing a significantly greater share of the pie. In turn, they would be embracing, as opposed to scolding, anyone out there contributing to the scale of their interactive ad offerings.
Is it too late for print to make up for several mostly lost years of Internet ad revenue? I truly hope not and perhaps the steps I outline below, though TV-focused, provide a roadmap.
For a while television was somewhat immune to online due to a lag in broadband penetration. Now, with the proliferation of sight, sound and motion advertising on the web, I urge television ad sales leaders to learn from earlier missteps. As we emerge from this current recession, treat it as an opportunity to grow, rather than contract, your digital businesses just like many of today's top Internet companies did in the post-bubble era. Beyond maximizing your Internet-only ad products, enhance your television ad offerings through cross-platform packaging. This will require more than just infusing some digital expertise into your sales teams or taking down the walls between your television and interactive groups. You must directly combat the anxiety associated with cross-platform complexity through training and by putting tools and processes in place that tear down the walls between television and interactive ad sales management.
I believe in brands, and traditional television and print constitute some of the most trusted brands on the planet. Even online, they provide well-lit canvases with desirable audiences for advertisers to market their wares. It is well documented that many traditional media companies face severe supply and demand imbalances with the advertising on their websites (I should never see a dancing mortgage ad on one of these sites but frequently do). Trying to plug the firehose of supply (Google and others) is not the answer though, as it is time to build up demand by using your superior advertiser and agency relationships. However, until the ad sales teams on the traditional media side are unafraid of interactive and properly compensated for the additional work in generating cross-platform business (maybe try a higher commission percentage when a TV or print salesperson bundles significant interactive dollars into a deal), these relationships mean little. As long as digital ad dollars are seen as cannibalizing the mother ship by senior traditional media management, Internet-only shops will continue to dominate the ad revenue race online.
Heck, even if you disagree with me and believe that digital will only ever be a "rounding error" to your traditional business, you should still take these steps to be prepared as TV advertising becomes more dynamic, addressable and interactive and starts to very closely mirror Internet ad serving and selling.
Michael Stoeckel is Vice President, Digital Products for INVISION Inc.