Advertising is content

The concept of advertising as content is a tough one to grasp in a world where ads surround or interrupt other forms of content. But it’s a critical Media 2.0 idea to get your mind around before you can create applications for distributing this kind of content and make money in the process.

This year’s Annual Ad Spending Study by Outsell Inc. shows that advertisers in the U.S. think the most effective online marketing tool is their own website. According to a report in Online Media Daily today, they’ll spend almost 12% of their total 2007 advertising budgets on their own home pages. Email and search marketing came in second and third.

Reports like this send clear signals that media companies cannot ignore. None of the top three ways advertisers want to spend their online money involve the traditional Media 1.0 model. Advertisers have been supporting content for many years, and we’ll see an upward curve of advertisers creating their own in the years ahead.

We’re also going to see advertisers working with each other in sophisticated ad networks that place ads on advertiser and other business sites — sites that match contextually with the people those advertisers are trying to reach. As I’ve reported before, the new airline Skybus is running ads on its site with Apple’s iPod being one of the first. If you’ve traveled on a commercial jet anywhere in the last couple of years, those white ear bud cords are in every row.

You’ll begin to see aggregator sites that use the content created by advertisers to fill pages and applications. This is a role smart local media companies could be playing, if they could just get past the idea that the only value they have is the news content they create. While that may be their core competency, their sales staff is an edge competency that can be exploited to develop a powerful new revenue stream.

UPDATE: Rex Hammock writes in the comments: “To the traditional media channel ‘owners,’ this fact is clear: Your advertisers are now your competitors.” Amen.

Comments

  1. Terry. I’ll add a little historical context to the notion that ‘advertising is context.’ Since the late 1800’s,’ companies have been creating media to communicate directly with customers. One of the oldest continuously published business-to-business magazines in America is a magazine published by John Deere and distributed to farmers via its dealer network. When radio came along, advertisers commissioned their own shows — indeed, advertisers owned their own radio stations (i.e., WSM in Nashville). Likewise, TV (“soap operas”).

    My company is in the “custom media” business. We create media for clients who want to communicate directly with their customers or members. We are known for doing this via magazines, but have also been doing this for clients online since the days of CompuServe forums.

    In other words, big companies have always been in the media business — they just didn’t know it. I believe, like what your post implies, it was not until they set up a website and learned the degree of “content” necessary to continously engage customers/members that a light went off in the heads of corporate marketing executives that said, “Hey, we’re in the content business: We can communicate directly with our customers without going through all these intermediaries.” Again, they’ve been doing it for over a century, it’s just been seen as something called “corporate communications” or “member relations” or something else.

    Almost every big media company now has a subsidiary called “Custom Publishing” or, now “Custom Media” or “Marketing Solutions” — and there are companies like ours who are independent “agencies” that assist corporate and association clients create and manage “content.” Indeed, some in my field want to call what we do “content marketing.” I’m not comfortable with that as I think “conversations” and “community” are much more complex and challenging than mere “content.”

    However, as you indicate: To the traditional media channel “owners,” this fact is clear: Your advertisers are now your competitors.

  2. oops — I meant “advertising is content” in that first line.

  3. My problem with ‘Advertising is Content’ is that it has always been content. Recently, it has become undesirable content. The Persuaders from PBS covers how people convert advertising to clutter. ‘Advertising as i-net Content’ will become another form of clutter. Advertisers may be slow on the uptake for adapting to the internet but they will catch on. The people will find new ways to cut through the clutter that advertisers create. As an example, look at pop-ups and pop-up blockers. The problem advertisers are going to continuously wrestle with is that the internet is an almost entirely hostile environment.

    Past environments have welcomed advertisers at the chagrin of the masses. If the masses truly have control over the ‘jewel of the elite’ then advertisers will continue to face problems. Even embedded ‘actors’ on forums get found out and banned from those communities. Advertisers have enjoyed a historic dominance over the masses. It has carried over to this new medium and a new balance will need to be struck. Either they will again outsmart the masses or their dominance will be dropped a few pegs.

Trackbacks

  1. […] First if the brand is a reflection of the company rather than invention of an ad agency can we expect companies to take greater control in the production and dissemination of their own ads? Terry Heaton notes “This year’s Annual Ad Spending Study by Outsell Inc. shows that advertisers in the U.S. think the most effective online marketing tool is their own website”. […]

  2. […] Advertising is Content – by Terry Heaton […]

  3. […] First if the brand is a reflection of the company rather than invention of an ad agency can we expect companies to take greater control in the production and dissemination of their own ads? Terry Heaton notes “This year’s Annual Ad Spending Study by Outsell Inc. shows that advertisers in the U.S. think the most effective online marketing tool is their own website”. […]

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