Are ads killing the internet? Former 99U speaker and Timehop COO, Rick Webb weighs in on the house of cards of online advertising, the myth of targeting, and why we need to rethink regulation. Read on for some big picture insight into exactly what’s happening on your little screen.
It’s a time of upheaval for internet ads. Recent convulsions in data usage and targeting beg questions like: Are ads killing the internet? Are they the only way media will stay alive? Does that make them worth it? And do they actually work anyway? Rick Webb, co-founder of the Barbarian Group and COO for Timehop recently sat down with Gawker.com founder Elizabeth Spiers at the Northside Festival in Brooklyn for a conversation on the degrading value of online advertising. “Normal people go to a bar and talk about their exes,” Spiers said of her long friendship with Webb, “Rick and I go to bars and talk about digital and economy.”
Spiers and Webb unpacked how online advertising affects our offline social fabric, why we shouldn’t fear regulation in the age of GDPR, and why all of our assumptions of how the internet works are complete and total bunk.
Read on for some big picture insight into exactly what’s happening on your little screen.
Digital ads didn’t change our world.
“Almost everyone working in this industry is working under a bunch of false assumptions,” says Webb. The fact that the internet created a new world of ad spaces, doesn’t mean that those ad spaces are more valuable. How does Webb know? He compares it to the first appearance of TV ads. “The ad spending level in the US has historically been 1-2% of GDP and it hasn’t changed except for one time: television,” says Webb. “[TV advertising] worked demonstrably better, so [companies] all notched up their spend.” But when internet ads appeared, the advertising industry’s numbers didn’t mimic that game-changing TV moment. A metrics-based marketer might be able to tell you a whole lot of numbers, but if those numbers aren’t dollars it doesn’t matter. If you look at the U.S.’s spend on advertising like an economist, Webb concludes that digital advertising doesn’t add demonstrable value to advertisers.
Targeting may all be myth.
If Webb has one mission to fulfill, it’s to proclaim that targeting—the same issue that has the world up in…
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