Monday, March 23, 2009

The Failure of Advertising?

By way of Techcrunch, a great article on how advertising models are failing on the web and that the internet is actually killing advertising (his words, not mine). The author, Eric Clemmons, is a prof at Wharton and the article is a must-read for those in film - especially now as many folks are touting advertising as the savior of film online. I've never believed this - if advertising works for niche content online it would have worked for it on tv. I also find that in my personal experience online, I completely ignore ads (of course, I do this in print as well) - and they are very easy to ignore - Whenever I watch internet video that has ads, I simply watch something in another tab until the forced advertisement is over. I also think it's been made abundantly clear by TiVo that people will pay a premium to avoid advertising, but Clemmons argument is more sound than any I've made. My favorite quote from the article:
"My basic premise is that the internet is not replacing advertising but shattering it, and all the king’s horses, all the king’s men, and all the creative talent of Madison Avenue cannot put it together again."

So if advertising is being shattered, how are people going to make money online? Clemmons thinks from three things: selling real things, selling virtual things and selling access. He explains this further in the article, but what he ends up supporting as possible business models are:

"Selling Virtual Things: People will pay for superior, timely, original content and for superior online experiences.
Selling Access - providing the customer enough info to make the informed choice they want to make"

I agree completely. These aren't that far from the "generatives" described by Kevin Kelly which I described in an earlier post. I'm pretty sure advertising isn't dead yet - people will keep trying it for awhile, and a few will even make money with it - but only in aggregate as a large company, not for any individual film. I think the film business would do well to consider the implications of the possibility that Clemmons is right though - because we definitely need good business models and don't have time to waste on trying to reuse old ones that may ultimately fail.

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