Why is Google transcendent and Yahoo a takeover target? Compare the following:
Sue Decker, president of Yahoo! Inc. (Nasdaq:YHOO), addressed the advertising industry during a keynote this morning at the 2008 Advertising 2.0 New York conference.
“Yahoo! is helping to accelerate the transformation of how display advertising is both bought and sold,” Decker told the audience earlier [...]

As media companies struggle to figure out their digital future, the elephant in the room is that they have only been able to monetize online audiences for pennies on the dollar compared to traditional media. Here’s why: Traditional advertising formats FAIL on the web. By traditional advertising formats, I mean display ads, video ads, and [...]

Tech bloggers and analysts had a collective cow yesterday over the news that January 2008 comScore data suggest clicks on Google’s paid search ads have stopped growing, which implies that Google may be vulnerable to a US recession already underway. Fred Wilson had a sober reflection on why he stands behind his (albeit ill-timed) [...]

Microsoft announced today that they are going after the holy grail of advertising: integrated ROI measurement and tracking. The big problem with online ROI measurement that Microsoft is targeting is the inability to assign quantifiable value to brand advertising, e.g. banner ads, and which results in disproportionate value being assigned to search advertising — the [...]

A new McKinsey & Co. report called “ How Companies Are Marketing Online” draws the astonishing conclusion that many advertisers are reluctant to shift dollars online — despite the massive shift of consumer attention online — because of the “absence of meaningful metrics and adequate capabilities.”

Two reports out today illustrate how the traditional media industry is working hard to prop up their declining business. First, as evidence of the decline, IBM released a study that says that the Internet is about to overtake TV as the principal medium in most households (via MediaPost):

Nielsen asked 1,000 consumers on its new “engagement” panel if they could recall any TV commercials they had seen — only one third of them could. In contrast, 79% could recall at least one TV show. This is not the least bit surprising because traditional TV advertising creates NO value for consumers in the moment [...]

The page view may be dead, but page views are still the currency for online display advertising, with most display ads still being bought on the basis of CPM, or cost per thousand ad impressions — and impressions are a function of page views. The problem is that the page view-driven online advertising economy is [...]

Following up on my post about the poor state of online ad relevancy, I’ve been digging deeper with some of the companies that are working to improve that state, which lead to the following interview with Larry Allen, SVP, Business Development and Marketing at TACODA. Believe it or not, we completed this interview before the [...]

FeedBurner just quietly posted to their site the official announcement that Google has indeed acquired Feedburner. Here’s what CEO Dick Costolo has to say about why it’s such a great fit (which it really is):

Google may be forever denying that it is a media company (and an ad agency), but Microsoft is embracing the transformation of software into media and the overall convergence of media and technology. Yusuf Mehdi, Microsoft’s senior vice president and chief advertising strategist, said in reference to denying rumors of a Microsoft acquisition of Yahoo [...]

Now that Google, Yahoo, Microsoft, and WPP have spent collectively $10.4 billion to acquire the largest online display ad platform companies (DoubleClick, Right Media, aQuantive, and 24/7 Real Media) on the bet that display ads will be a key driver of growth for online ad spending, it’s fair to ask exactly what the value of [...]

Can you name an online media company that has billions in ad revenue but has never had to bother with measuring unique visitors or pages views — those antiquated measures that keep the dynamic web locked into antiquated ad sales processes and ruin the online advertising economics of most media companies?
Ok, so that was a [...]

I sat in on a presentation by a Google rep to a New York agency — it was a big, wet sloppy kiss. Here was Google, king of impersonal, self-serve online ad efficiency up to its eyeballs in gooey “relationship building.” It’s no accident that Google’s New York office has more humans than servers.
This is [...]

If Craigslist is killing the newspaper classified business, then it appears that newspapers’ real missed opportunity may be in failing to provide a sufficiently conducive environment for seeking and selling sex and love.

Reading this analysis by Compete was one of those Doh! Of course! moments (and, as a commenter on the Compete post points out, [...]

What is Google’s core competency? I would argue that it’s harvesting the value from massively scaled, complex human activity, i.e. millions of websites linking to each other and hundreds of thousands of advertisers bidding on key word and experimenting with ad creative, clickthrough rates, and conversion rates. The other critical element of this core competency [...]

As anticipated, Google has launched a “cost-per-action” advertising program that allows advertisers to pay only for specific results, such as a sale, lead, sign-up, etc. Andy Beal thinks this is a threat to online affiliate marketing, and surely it is. But Aaron Wall’s comment jumped out at me:

If they push this as hard as they [...]

Discussions of Google’s offline media ambitions — to extend their wildly successful platform for online advertising to offline advertising — typically assume that Google’s success in the offline arena is just a matter of time. But the reality is that Google has nothing but a string of failures to show for itself, most notably in [...]

Chris Anderson highlights the tiny direct cash return that Guy Kawasaki earned on his first year of blogging: $3,350 at a CPM of $1.39. That’s a pitiful CPM by mass media standards — and it’s totally wrong. The way media has traditionally worked, the more “pure” the audience is, the more efficient it is [...]

If you spend too much time in Silicon Valley you’d think that the technology industry — with Google leading the charge — already owns the future of advertising. But don’t count out Madison Avenue just yet — they may be responsible for perpetuating the imbalance between media time spent online and ad dollars spent online [...]

There’s more talk about the death of page views, this time from the Chief of Insights at Yahoo, the recently dethroned page view king.
The reason page views persist is that they are a key variable in the still dominant currency of online advertising — impressions, and its derivative CPM. Impressions themselves are merely the clunky [...]

One sales executive apparently sees more opportunity selling ads for PayPerPost, whose no-disclosure-required policy was just declared a big No-No by the FTC, than selling ads for MySpace (via PayPerPost blog):
Randy Mountz, former vice president of sales for MySpace.com’s Midwest region, has joined PayPerPost as the company’s vice president of sales, a new position.
Also [...]

Everybody is betting on the future of online advertising, but catching up on reading for this week, I was struck again and again by how deeply painful the growing pains are…
The Internet Advertising Bureau has launched an ad campaign to “convince” advertisers to spend more money online (via MediaPost):
To help develop the campaign, the IAB [...]

In the standing-room-only Web 2.0 Summit workshop sessions on the future of marketing and Advertising 2.0, the belief that the revolution will be funded by advertising came face to face with the deep structural problems of advertising in the digital age. The poster child of both the promise and the existential angst of networked, digital [...]

Unbowed by its failed magazine print ad program, Google has cut a deal with 50 major newspapers to sell remnant print ad space to its enormous roster of AdWords advertisers. Here’s the upside and downside for Google and the newspaper industry:

Upside
Google — Even if newspaper print advertising continues to decline, Google’s share will be greater [...]

Isn’t there an odd contradiction in all the thinking about new media? Individuals are now empowered to create content, to publish and have a voice without going through the old corporate hierarchy. You can blog and be heard, all for free, without asking permission. But what about brands? The assumption that online advertising will finance [...]

Last week I attended the Consumer Engagement Conference, put on by the Advertising Research Foundation (ARF) and the American Association of Advertising Agencies (AAAA), where I discovered that the word “engagement” — which is being proffered as a new “output” metric for advertising to replace outdated “input” metrics like Gross Rating Points and Impressions — [...]

As advertising dollars continue their inexorable march from offline to online, the battle for control of those dollars will be fought over the fuzzy middle ground between branding and direct response. I can’t count how many times at the OMMA conference I heard someone say it “depends on the advertiser’s objectives.” The problem with allocating [...]

I’ve advocated that media should evolve into marketing services — according to lastest Veronis Suhler Stevenson Communications Industry forecast, that’s increasingly where the money is going.
NON-ADVERTISING-BASED FORMS OF MARKETING - especially newer sectors such as branded entertainment, event marketing and experiential marketing - have emerged as the fastest growing segment of the media economy, [...]

A debate has erupted over the definition of blogs and the value of blog “influentials” as drivers of advertising CPM rates, which is so Old Media in the particulars it’s really quite astonishing. Scoble challenges Windows Live Spaces’ definition of a blog and then plants this lightening rod:
What does Microsoft do when it says “we [...]

The state of search marketing was on full and vivid display at the 2006 Search Engine Strategies Conference in San Jose this past week, masterfully orchestrated by Danny Sullivan and Co. (thanks for the invite, Danny). I came away with pages and pages of notes, but here are some observations that rose to the top [...]

Om Malik took an interesting critical look at the Google deal with News Corp, which got me thinking about whether MySpace matters much at all to this deal, despite all the hype:
In a conference call, FIM executives noted that a very large number of people leave MySpace to go to Google. According to data collected [...]

I’ve been predicting for a while that the TV advertising house of cards would collapse, and McKinsey just huffed and puffed and predicted (to its big Fortune 100 advertiser clients) that “by 2010, traditional TV advertising will be one-third as effective as it was in 1990″ (from AdAge):
That shocking statistic, delivered to the company’s Fortune [...]

What does it say about an advertising format when an industry “council” has to be formed in order to arbitrate the problem of advertisers not knowing whether they are getting what they paid for? That’s what happened to both pay-per-click advertising and TV advertising this past week, and the similarities between these two ad councils [...]

Inform.com has wisely gotten out of the Web 2.0 news aggregator business and into the publisher services business. Erick Schonfeld at the Business 2.0 Blog has the scoop:
As readership declines for newspapers and online readership grows, every publisher faces the threat coming from the edge of the network. Sites like Google News, Yahoo News, [...]

An NYU professor conducted an independent analysis of Google’s efforts to combat click fraud and found that, while Googe’s efforts are “reasonable,” pay-per-click advertising “does not offer any ‘built-in’ fundamental protection mechanisms against the click fraud since it is very hard to specify which clicks are valid vs. invalid in general” and that any particular [...]

With click fraud moving quickly from the ridiculous (Clickmonkeys) to the absurd (“gangs” of click frauders), Google is clearly positioning itself for the coming transition from a click-based online advertising economy to a conversion-based online advertising economy.
Every day new evidence is emerging that Google’s new landing page quality scores and Google Checkout are all [...]

Beyond affiliate and cost-per-action advertising, all paid media advertising models — from billboards to print ad to TV spots to pay-per-click text ads — are “indifferent displayers of advertising.” I lifted that apt phrase from Bruce Schneier’s Wired piece on Google’s click fraud crackdown:
Google is testing a new advertising model to deal with click fraud: [...]

Perhaps the greatest testament to AdSense’s success, and the greatest irony as well, is the degree to which AdSense has been corrupted by gaming of the system, abuse, and outright fraud.
Google CEO Eric Schmidt thinks that market forces will correct the problem of click fraud (via Donna Bogatin):
Eventually, the price that the advertiser is willing [...]

I predicted months ago that click fraud would cause advertisers to lose faith in pay-per-click advertising, and so it is coming to pass, according to a new study by Outsell that estimates click fraud at $800 million (not so far from the middle of my back-of-the-envelope estimates):
The perception of pervasive fraud has prompted many advertisers [...]

With the launch of Google Checkout, Google is clearly aiming to be the world’s online shopping engine. The strategy has all the hallmarks of AdWords — Google doesn’t care what you’re looking for, what you find, or where you buy it — so long as Google can make money off of every step of the [...]

In Cannes, advertising and media executives have seen the death of paid media advertising:
All week at Cannes, advertising and media executives have grappled with the implications of virals which have reached millions of people via the internet, often by-passing traditional media. A few have involved no spend on media, offline or online.
With the success of [...]

At the Cannes Lions Advertising Festival, search advertising is getting slammed for its inability to build brands — and rightly so:
Laura Desmond, chief executive of Mediavest USA, which advises clients such as P&G, Masterfoods and Kraft on buying and planning media, said: “Google is going to have to change its business model soon. Search alone [...]

I increasing believe that in order to survive and grow in a digital, networked, social, participatory world, media companies need to evolve into marketing services companies. Here’s what’s driving me to that conclusion.
Advertising took another significant step yesterday towards graduating from paid media placements (i.e. traditional ads). Ironically, it starts with a paid media placement [...]

Search advertising was revolutionary because it created a new science of ad relevance — the old targeting tools of demographics and psychographics seem like a shot in the dark by comparison. On the face of it, the value proposition of search advertising makes perfect sense — ads are chosen based on key word relevance — [...]

Superman has taken over MySpace’s homepage, in what was likely a lucrative deal for MySpace and a smart move for Warner Brothers — mostly.

WB is certainly capitalizing on MySpace’s prime homepage real estate, with an appropriately participatory marketing program that invites fans to upload their own superman pictures. And fans have indeed uploaded some fun [...]

A few weeks ago the ad industry was predicting that the 2006 TV upfront would hold flat — things are changing, but not that fast. Let me requote:

The 30-second spot, maligned as it is, “still works, despite TiVo and clutter,” says Andy Donchin, director of national broadcast at media-buying firm Carat North America. “[Let’s] [...]

Brand advertising is the X-factor of the online advertising land grab — Google knows it needs to tap into brand/display advertising to grow, but Eric Schmidt knows they’ve got a problem:
“It’s a question of whether our system, which is so highly measurable, can really handle that . . . We have not yet come up [...]

News flash: Google is indeed fallible — and vulnerable. I predicted on several occasions (here, here, and here) that Google’s Print Ad program was less than promising (to put it kindly), and sure enough:
GOOGLE’S RECENT FORAY INTO PRINT advertising fell short of the company’s expectations, a company executive said Wednesday. Speaking on a conference call [...]

Robert Young provides the latest example of the unbearable lightness of 2.0 business strategy, arguing that media companies should create American Idol-like platforms for individual self-expression:
Think of this way… what if “American Idol” had been produced solely by the capabilities of the contestants themselves, without the expertise and talent of the show’s producers, directors, writers, [...]

Word of mouth marketing has been around for a long time, but brands are becoming more sophisticated. P&G, one of the largest advertisers, is pioneering a 2.0 approach to marketing that has little need for paid media advertising and leverages good old-fashioned face-to-face social networks. From a BW article:
About a year ago, P&G began developing [...]

I’m not making this up — brands really are eschewing paid media advertising and are instead creating their own media 2.0 platforms for connecting with consumers directly. And the web makes it possible, because anyone can create media AND because spiraling online ad pricing are driving brands to more quickly abandon the paid media ad [...]

Reading about Yahoo’s new search-advertising software code-named Project Panama, I can’t help wondering whether any other form of advertising can compete with search advertising’s projectable ROI and hyper-efficiency:

But as advertisers enter each bid, they will see an estimate of how many clicks they will receive each day. More important, a graph will show how many [...]

It’s official — Microsoft is no longer a software company. With the launch of adCenter, Microsoft will be joining the ranks of Google and other media companies:
“Ad-supported software services are an integral part of Microsoft’s plans to give consumers access to a broader variety of digital media, whenever they want and on whatever device they [...]

Even before the advent of broadband video and video iPods, the $2 billion+ market for network television advertising was a house of cards, held losely together by the “Nielsen ratings,” a data set so deeply problematic that it may soon bring down the entire house.
MediaPost reports on a new tale of error and inaccuracy involving [...]

I’ve been very skeptical of Google’s Print Ad program since its inception. So I’m hardly surprised by the news from BusinessWeek that the program is a dud (thanks to David Utter for passing on the article):
Carl D. Haugen, president of BluePenguin Software, spent $3,000 on an ad through Google, which ran in the November issue [...]

The discussion about MySpace on tech.mememorandum this morning is dripping with irony. On the one hand, you have the MySpace apologists, arguing that what teenagers do on MySpace is no different from what teenagers of past generations have done to rebel and be different, and that parents should just teach their children well and not [...]

So Microsoft is going after IBM with a $500 million marketing campaign, which apparently doesn’t include a large role for blogs or other “hot” viral marketing tactics? Hmm, go figure:
The campaign began yesterday with eight-page advertisements in The Wall Street Journal, The New York Times and other newspapers. The $500 million to be spent [...]

What’s an AdWords advertiser to do? Your pay-per-click (PPC) advertising is profitable, but then you find out that 35% of the clicks you paid for were fraudulent. Does your PPC advertising campaign still make good business sense?
That’s the conundrum that Radiator.com confronted, according to the Washington Post:
After analyzing where and when each click came from, [...]

I’m not sure if I’ll be the first to predict it, but search advertising is headed for a cliff. I can’t say with any certainty when–or whether–the crash will come, but the evidence is mounting.
Everyone is talking about the $90 million click fraud settlement, and the Google apologists are out in force, arguing that $90 [...]

Everyone in Old Media, and many in “New” Media (which isn’t as cutting-edge as it thinks it is), should fear the radically different media habits of the Digital Generation now coming of age. As Jon Fine points out:
Today’s teens are the first for whom self-created content competes with teen-aimed media like videogames. There are now [...]

Search advertising has been all the rage the last few years, leaving sellers of traditional display advertising to fear a slow death as Google and other search engines siphon off all of the ad dollars. But after a dramatic run-up in search, there’s evidence that we’re reaching a plateau.
I try to avoid the dangerous business [...]

Everyone thought TiVo, with its ad-skipping technology, would lead to the death of TV advertising — but it’s actually the shift of audience and media value to digital media that is draining the value from broadcast media. Take Coldwell Banker’s new ad campaign in which TV plays an ancillary role, supporting the real action which [...]

Nathan Weinberg at InsideGoogle wants to know why Google has extended the deadline for its print ad program:
Does this mean that responses and bids have been less than stellar, or that Google realized twelve days simply wasn’t enough time for most people to get their bids in?
Can someone please give all these Google watchers a [...]

So Google thinks they can measure the ROI of advertising in offline media. Good luck! For years, Corporate America has been putting the screws to marketing departments to find a way to measure the ROI of advertising, but until recently the results have been mostly smoke and mirrors.
One of the (many) empty promises of the [...]

Is it possible that the text ads pioneered by Google have near zero branding value and, as one search advertiser noted in a Stifel Nicolaus analyst report on Google, the “lifetime value of a customer acquired through Google for his/her business [has] approached zero”? The Stifel Nicolaus report by Scott Devitt is cited in a [...]

It’s entertaining to watch tech commentators, who know next to nothing about the dynamics of print advertising (with all due respect), assess Google’s new print advertising program. Does anyone writing about Google Print Ads today know who the Nielsen of print ad buying is? (hint: it’s MRI — Mediamark Research).
It makes perfect sense that Google [...]

The news that Google is testing rich media supports the view that traditional brand advertising is not about to go away. Having wrung every penny from smaller advertisers with more transactional businesses — which are the ones that work best with text ads — Google is aiming now at the BIG advertisers who have [...]

Will media become a commodity? Google and the search marketing industry that grew up around it think so. Creators of Web 2.0 content applications like Digg and Reddit think so. Today, we learn that eBay also thinks so — MediaPost reports that they pitched an electronic trading system for buying and selling media. And who [...]

The conventional wisdom is that traditional advertising is wounded and dying at the feet of innovators like Google AdSense and Word of Mouth Marketing. The NYTimes continues its role as a media and technology hype machine today with its coverage of the Word-of-Mouth Marketing Association meeting:

Speakers with titles like “marketing medic” or “manager of influencer [...]

For most print publishers, online ad revenue (from the online version of their print publications) has represented only a modest percentage of total ad revenue — sufficiently small that they still see themselves as principally in the print publishing business, since that’s where most of the money comes from. Online advertising revenue has been growing [...]

Pheedo, the RSS advertising shop, released an analysis of client data that showed readers of RSS feeds are nearly 10 times as likely to click on an ad sent as a standalone feed post than an ad in embedded in the content of the post.
Consumers using RSS readers are more likely to click on [...]