Digital Doubters

But the numbers don’t bear his predictions out. Internet advertising will become the largest single global advertising medium in 2017, according to ZenithOptimedia, overtaking television, which has held the top spot since 1995 (previously newspapers were the largest single advertising medium).

By 2018, almost 40% of advertising investment will flow online (the same share that TV enjoyed at its peak in 2013). At the same time, people in developed economies are now spending more than three hours daily online. So it cannot truly be said that digital advertising is being killed.

It is driven by a clear shift in media consumption towards online and mobile channels. But also by the promise of better targeting, greater efficiencies and improved accountability for marketers.

But digital advertising has not been without its detractors, who would support Palmer’s point of view. Particularly notable have been voices such as Bob Hoffman in the US and Mark Ritson, a Professor of Marketing in Australia.

Criticism has focused around three broad areas:

1. Abandonment of strategic thinking in favour of slavish adoption of ‘digital-first’ solutions;
2. Growth in barriers to digital advertising effectiveness;
3. Weak audience metrics.

In most cases, the strategic goals of marketers are the same as they have ever been: to attract new customers, to retain existing ones and to grow profits. A range of possible ways – digital and non-digital – are available to meet these goals. But, for many, ‘digital’ (or ‘mobile’, or ‘programmatic’) is the answer to all questions, rather than one of several ways to reach and engage with customers.

In applying digital solutions, many companies say the words but don’t follow through: for example, they urge people to visit their website for anything they need, but don’t offer a back-up number to call if their needs are not met online. Or they ask consumers to follow or ‘like’ them on social media, but offer no reason to do so. Or they build an app because they think they should – but which has little relevance to any customer need.

The second set of challenges revolves around understanding and taking account of the growing barriers to digital advertising effectiveness. Insufficient attention is being paid, arguably, to the impact of viewability, fraud and ad blocking. Almost half of ads served are never fully loaded onto users’ screens. Eye-tracking data suggests that only 9% of them are actually looked at for more than a second.

Nobody has been able to calculate the incidence of click fraud, but some estimates have put it as high as 30%. Doubleclick reports that just 0.1% of display ads in view are clicked on (or, as Solve Media puts it: you are more likely to complete Navy SEAL training than you are to click on a banner ad). Half of mobile clicks are accidental.

Ad blockers have been installed by around a quarter of US and UK internet users. In combination with the 10-20% of people in the developed world who are not online, this represents a significant part of the population who are simply not reachable through digital means.

The general weakness of digital audience metrics is not helped, critics argue, by the dominance of just two players in most countries, both of whom insist on using their own proprietary methods. Professor Mark Ritson was incensed at recent errors admitted to in the calculation and reporting of Facebook’s video audiences, not just because they served in inflate audiences by up to 80%, but because nobody had actually spotted the error for two years.

This, he argued, suggested that people were not looking as carefully as the should at the quality of the audience data being used to support decision-making.

Like other media, digital media track opportunities to see advertising rather than actual exposure – in the form of Page Views. This is not better or worse than the practices employed by other media like print. There, advertising is traded on the basis it appears somewhere in a publication people claim to have read or looked at – whether or not they turned to the page the ad appeared on.

Similarly, a web ‘Page View’ simply means that a user initiated the loading of a webpage. He may or may not have completed the loading, may or may not have scrolled all the way down to the bottom of the page (some of which may be below the bottom of his screen) and may or may not have noticed any of the banner ads on and around the page.

Against this onslaught of criticism, digital supporters have not been afraid to fight back. In their view, digital has democratised the world’s information, connected billions of people and given brands their biggest marketing opportunities of a generation.

On the other hand, perhaps, as Kate Richardson commented in Mumbrella, an Australian trade magazine, referring to Messrs. Hoffman and Ritson: "they’re not anti-digital, just anti-digital bullshit."