Interesting Reading!
From: DanOgma@aol.com [mailto:DanOgma@aol.com]
Subject: Re: Online Advertising: Problems & Solutions
IADL et al;
Expectations greater than any reasonable person could ever believe along with a naieve confidence that advertisers would flock to support something they neither understood, nor had a hand in developing, is what has created the current conundrum discussed in the Forbes article.
But, the web is still an infant. Unlike TV which had twenty years of
experimentation and rolled-out its initial broadcast base before the first ads appeared in 1949, the browser-based World Wide Web was just two years old when the first banner campaign was launched.
Again unlike television in the early days, where you only required a single point of origin and one TV set to reach a whole block with a program like the "Jack Benny Hour", until recently the only way to view the web was on a PERSONAL computer. And, the way to share interactive items of interest is still via e-mail!
Home computer penetration has grown from the mid single digit percentages at the web launch to around 30% today. Much of this is attributable to the web. And, it is HOME usage that ultimately counts.
However, just like TV viewers who are NOT watching "E.R." just to see the ads, web users don't log into NetCenter just to see the latest banners. Nor are they likely to go online solely to avoid the crowds at the mall. But like TV, over time the ads will develop into a series of standardized "acceptable" formats, and the use of the e-commerce options will become mainstream.
Added to all this is the fact the infrastructure required to support, even what we have today, has not kept pace. I remember working on competitive tracking of early ISDN for the number two supplier of equipment in the world back in 1986, yes '86!!!
This was expected to become the high speed backbone of convergence touted by the gurus. The problem is we still don't have "convergence" and few users have anything faster than 56K modems on standard dial-up telephone lines.
Likewise, HDTV never got off the ground in North America and the standards for digital TV were only set by the FCC in 1997.
As for telephone delivery, the RBOCs lost their early advantage and are feverishly trying to roll-out the DSL formats for high speed bandwidth before the "cableguys" capture too much of the market. Then there's satellite and point-to-point radio delivery starting to make headway.
The infrastructure suppliers are still not sure of the business models that will be successful and are fearful of cannibalizing their existing revenue streams. Ain't competition great!
Sadly though, much of the early advertising hype was from techies who knew what was in the labs, touted the benefits long before products rolled-out, and didn't have a clue about the real business issues their companies faced in bring these to market.
Bottom line, just like in 1949 nobody could accurately forecast that
television spending would account for 24% of all advertising spending in 1998, and that total ad spending would grow to approximate the worldwide GNP of 50 years ago!
We too cannot see the future. We can only plan, test, and never give up hope.
What is accurate is that more early stage commercial testing of this medium is occurring than did TV, cable, radio, magazine, outdoor, or newspaper before it. And, the near-term promise it holds is greater than all the other media combined!
Dan
Dan Wasserman
President & CEO
Thorne, West
1-888-276-8671 or 905-771-9731
Integrating innovative web-based strategies with traditional media know-how.
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