I bought a nice shiny new MacBook yesterday. I'm not sure how many Macs I've owned in my lifetime, but I think this might push the number into double digits. Anyway, it's my first Intel-based Mac and I've giving it a pretty good road test over the last 24-hours.
I've been thinking about writing a post on the current state of ad serving lately, so out of curiosity I decided to take a peek at my cookies in Firefox this morning. Holy crap! I've owned this computer for less than 24-hours. I installed Firefox maybe an hour after unboxing, and I'm guessing that I have 3-4 solid hours of browsing time logged so far.
Total number of cookies: 168
Number of cookies from ad serving networks: 71
It's not the sheer number that freaked me out....ok, the number did kinda freak me out a little bit...it's the fact that online marketing professionals are still buying into this as a viable way to spend their precious marketing dollars, and apparently there's a LOT of it going on.
If you're reading this right now, then I'll make the broad assumption that you've purchased something from the Internet before. Most likely, you've purchased a lot of things online. Now, when the last time you saw a banner-type ad somewhere, clicked-through and actually bought something as a result? Exactly...
Most of the ad networks today tend to dress up their services by calling it "behavioral" or "contextual" targeting, but it's far from being transparent or effective.
Example: I have a nice canister vacuum from one of the high-end U.S. manufacturers. I realized that I hadn't changed the filter recently, and went to the manufacturers site to buy one. (I have no interest in going to Sears or Target in hopes that I could find a 3rd-party filter that might fit. I imagine it would be a lot like going to OfficeMax and trying to figure out what kind of ink jet cartridge I need for my printer.) Anyway, I don't see a filter for the model I have, so I find the nearest store and leave the site. About a day or so later, I notice that I keep seeing banner ads for a fancy new upright vacuum from the same company. And then I start seeing that same banner ad EVERYWHERE. I'm not the smartest guy in the world, but I realized what's happening here: The ad serving network saw that I abandoned their clients site, so obviously I have exhibited the target behavior for displaying their ad. Never mind the fact that I already own one of these ridiculously expensive vacuums. Or that I was explicitly searching a new filter. What the heck...throw that ad up there anyway. Maybe I need a second one so I won't have to carry the other one up the stairs all the time.
You get the point. To make matter worse, the pricing model for most of these networks is just ponderous. In my previous life, I sat in a room with a couple of sales guys from a very large network. The dialog went something like this:
Big Ad Network: We will monitor people that come to your site and then drop a cookie on those that exhibit certain behavior (i.e., they don't buy anything). Then, we'll serve up an ad to those same people as they traverse the Internet. If that same person returns to buy from your site, you'll pay us a small percentage of the revenue.
Me: You mean that I'll pay you if the user actually clicks-through from the ad that you're serving up, and then buys something, right?
Big Ad Network: No...we feel that we are influencing the user's behavior by simply showing the ad. If they return to buy, it's most likely because we "re-exposed" your brand to them.
At this point, I just smiled and nodded and thought about what I was going to have for lunch that day. This is just wrong on so many fundamental levels:
- The vast majority of consumers don't generally buy on the first visit to a site. They research. They read reviews. They look for a better price. They bookmark the site with the intention of returning later. Do you really want to pay someone 5-10% off your margin for what is fairly common behavior?
- On average, consumers click on 4 paid marketing campaigns before they make a purchase. Given the above behavior, why artificially inflate your customer acquisition cost?
Unfortunately, this wreaks of desperation marketing at a time when there is an abundance of tools for marketers to truly understand what the return is for their marketing spend. Stop the madness, people!
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