Sustainability - Jaffer Ali - MediaBizBloggers

Sustainability is a condition of existence which enables
the present generation of humans and other species to
enjoy social wellbeing, a vibrant economy, and a healthy
environment, and to experience fulfillment, beauty and
joy, without compromising the ability of future
generations of humans and other species to enjoy the same.
--Guy Dauncey, speaker & author

The title of this short essay, "sustainability" is the major concern of environmentalists and ecologists. Since I write about online media it is fair to ask what does this ecological term have to do with my area of expertise.

Simply put, the online media ecosystem is suffering under the weight of many practices that render it unsustainable. The lack of sustainability is masked by steady increases in money from advertisers coming online. But if you pay attention to the larger picture rather than one's particular situation, you can see the ecosystem as a whole is unhealthy.

What are the practices that render the online media ecosystem unsustainable?

The Targeting Meme

There are few practices more destructive to the online media ecosystem than behavioral targeting. The math underlying predictive modeling promised by BT has been proven to rest on fundamental errors and assumptions. The benefits to publishers are nil. The benefit to marketers is limited within such narrow parameters that the cost is not justified. Add the disastrous privacy issues and we have a creep factor coupled with its inherently unscalable premise; each new "advance" into complexity brings the system closer to collapse.

But that doesn't stop the BT purveyors eager to sell shovels to the hopeful miners. But it is becoming more commonplace to call BT for what it always was; snake oil.

Overwhelming Ad Clutter

The response to declining ad performance for publishers has been to increase more ad units per page. In ten years, we have beaten a path from 5% ctr to .1%. Few industry pundits acknowledge this simple fact; increasing what people want to avoid is no way to right the ship. This is a lot like trying to get out of a hole by digging ever deeper.

The online media ecosystem cannot get healthy by adding more toxic waste to the environment. And advertising has become more and more like toxic waste to offline as well as online audiences.

Erecting a Pay Wall

A pay wall solution completely ignores how passion over profit trumps content owners' desire and ability to charge for information. Forget news and current events becoming a sustainable pay business model except in the rarest of instances. This boondoggle proffered by Brill and Murdoch has yet to play out in all of its inglorious permutations, but this will certainly fail. Content creation will never be the same as it experiences great deflationary pressures as citizen journalists and passionate aggregators offer a global perspective on issues from Wimbledon to Mideast news.

Agency Woes

Agencies are caught in an unsustainable position unless they drastically change. Media buying is becoming more automated and the added value of agencies becomes less and less when creative voices take a back seat to algorithmic solutions. Instead of emphasizing creative and unique online offers, agencies play to their own death march concerts. Instead of offering solutions to an unsustainable ecosystem, agencies are so busy being busy that few of them can actually slow down long enough to contemplate.

Lack of Scalability

The top 100 advertisers in the US economy reportedly account for just under 50% of the total ad spend*. Ask any one of those big advertisers and they will universally say that the problem with online advertising is the ability to scale their reach. Even though over 76% of the North American population is online**, we ought to heed their woes. How is it that with 76%+ online, top brands are saying they cannot reach audiences cost effectively?

The simple answer is that people are ignoring ads and what has passed for reach is no longer a sustainable metric. We need a new definition of reach and then a new way to execute transmitting corporate messaging if advertising can sustain the ecosystem.

Long Tail Niches

The wondrous aspect of the online ecosystem is the plethora of choice and niche interests available to audiences. The devastating aspect of our niche mentality is to believe that every niche or hobby can be turned into a business. Longtail nonsense driven by self-indulgent narcissism has led to folks wasting tremendous resources chasing the modern equivalent of the fountain of youth.

The overwhelming majority of passionate niches are not economically sustainable and advertisers will soon understand that continuing to subsidize ever more fragmented marketplaces makes their jobs more difficult. Commoditizing our passions and turning them into money might seem like a nice idea, but common sense needs to be restored.

Each portion of the online media ecosystem is facing the issue of sustainability. Over the years, I have written about many of these issues individually. But this is the first attempt to combine the themes into a manageable cohesive whole. There are solutions to be sure, but we cannot begin to fully grasp them until we first recognize that the current course is not sustainable.

* Top 100 Advertisers: http://www.kantarmediana.com/news/05262010.htm

** World Internet Usage: http://www.internetworldstats.com/stats.htm

Jafferis the CEO of Vidsense (www.Vidsense.com), arguably the largest video network online and certainly the only one that does not utilize ads to attract audiences. If you would like to contact Jaffer, send him an email at: j.ali (at) Vidsense.com or pick up the phone and call 708-478-4500 ext. 105

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