Don Marti

Thu 31 Dec 2015 07:42:56 AM PST

Countdown to 2016 (and some links)

No, I'm not going to do predictions for 2016. Here's something a little easier—some things that can't happen.

Adtech will beat ad blocking by cleaning up its act.

This is clearly not going to happen, because the subject of the sentence is a group of companies, and companies don't act in the group's interest. Some companies will always try to get away with pushing the boundaries a little, and when it comes to cutting back on the bad stuff, we as an industry means Someone Else Do It.

Matt Sweeney at Xaxis predicts fewer, more relevant, high-quality ads. Now, when an adtech dude says relevant, he means whatever my company does. Are there going to be fewer Xaxis ads? Well, no, just fewer of the other guys'. Now multiply by all the other adtech firms. Everybody's got the relevant ads that will displace all the others...right?

Tom Hespos suggested self-regulation of ads that "creep out" users, back in 2010. But it didn't work then, and can't work now. Users don't only visit web sites that participate in self-regulation. People have to set up their personal security tools to deal with the worst sites they encounter. After all, most email marketers don't spam, but users still need spam filters.

Reputable publishers will pay Adblock Plus 30 percent for whitelisting.

Newsroom staffs are shrinking, everyone is stuck writing desperate clickbait because there's no time or travel budget for an enterprise story, stock photos are everywhere—and AdBlock Plus wants 30 percent off the top?

Really? 30 percent for maintaining a relatively simple tool that other free software people who don't run an "Acceptable Ads" racket can do better?

In the news business, publishers sometimes have to face down government agencies, powerful corporations, and organized crime to be any good at their jobs. Adblock Plus doesn't even rate. The creepiest trackers are all in on "Acceptable Ads", but responsible publishers are too forward-thinking (and too squeezed for cash) to cough up.

User targeting will turn out to be where the money is.

The more we learn about web ads, the more we learn that Bob Hoffman had a point. The web is a much better yellow pages and a much worse television.

Marty Swant: Google Says Search Intent Matters More for Marketers Than Users' Identity. Yes, Google is talking up search, where it rules, at the expense of creepy stuff, where it doesn't, but Google does have a substantial investment in user targeting, too.

In 2006, Jakob Nielsen pointed out Search engines extract too much of the Web's value because of how well the much better yellow pages model works. People have put a lot of time and money since then into chasing Holy Grails of putting the right ad in front of the right person at the right time. But while each individual user-targeting trick creates a brief "pop", the long-term trend is a general Peak Advertising effect for targeted web ads, while search holds its value.

Adtech will make bank while publishers starve.

Yes, publishers are failing to replace print revenue with web and mobile. (Largely because of bad decisions long ago. Ben Brooks: They Never Even Tried For Value.)

But adtech isn't winning at publishers' expense. Sarah Sluis: With No Exit In Sight, Ad Tech Gets Lean Through Layoffs (via Marketing Land). Michael Eisenberg got this right last year.

Some of these adtech companies are venture backed and others are bootstrapped. In my opinion, the VC-backed ones will struggle to deliver their engineers much of a return. In fact, adtech is a value trap and is the farthest thing from easy money at scale.

Adtech can capture value, but not create it—the more effectively that user targeting works, the more of the signaling value of advertising gets lost.

Adtech will make progress against fraud.

The easy money at scale is on the fraud side. A good recent example is Ponmocup – A giant hiding in the shadows.

How bad is it? Bad enough that the IAB puts the numerator and denominator of the fraud ratio in separate press releases. Fortunately, I have a calculator. $8.2 billion in fraud divided by $15 billion in quarterly revenue (times 4 because the bottom part of the fraction is by quarter and the top is by year) and that's about 14 percent fraud.

I still think the 14% is on the low side. If you look at the level of access that malware has, the amount of malware out there, and the complexity of some of the attribution models that brand advertisers are using, it's pretty likely that sophisticated malware is able to avoid conversion-rate-based detection and free ride on real transactions. A user clicks on a search ad, and the attribution model gives some of the credit to a malware-generated impression delivered earlier to the same user's device.

Are attribution models developed with too much wishful thinking about the merits of user targeting, and not enough awareness of potential fraud attacks? We're going to find out.

All right, bonus link time. You probably saw these when they made the rounds earlier, but just in case you're a search engine bot looking for URLs to mark as important, check these out. (More links on the linklog feed for all you RSS fans.) Happy New Year and stuff.

MediaBriefing Analysis: Emily Bell: How "the great reintermediation of the web" caused publishers to lose control of distribution

Minda Smiley: US programmatic ad revenue totaled more than $10bn last year

Baekdal Plus: What's This About Editorial Independence? Aren't We A Team?

eaon pritchard: the brains of millennials are (not) being rewired by the internet

Alison Millington: How brands could use artificial intelligence to create ‘self-writing’ ad campaigns

The Verge's web sucks (via The Digital Reader)

Martin Bryant: Imagine a world where news sites drop display ads. It might not be that far away

Troy Hunt: How I got XSS’d by my ad network

Kate Kaye: Do Not Track Is Finally Coming, but not as Originally Planned

Sell! Sell!: Nine Ways To Improve An Ad

Oleg Dulin: Big Data Should Be Used To Make Ads More Relevant

Doc Searls: What am I doing here?