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The term “fake news” was a casual phrase until it became clear to news media that a flood of it had been deployed during last year’s presidential election in the U.S. Starting in November 2016, fake news was the subject of strong and well-researched coverage by NPR (here and here), Buzzfeed, CBS (here and here), Wired, the BBC, Snopes, CNN (here and here), Rolling Stone and others. It thus became a thing…

… until Donald Trump started using it as an epithet for news media he didn’t like. He did that first during a press conference on February 16, and then the next day on Twitter:

And he hasn’t stopped. To Trump, any stick he can whup non-Fox mainstream media with is a good stick, and FAKE NEWS is the best.

So that pretty much took “fake news,” as a literal thing, off the table for everyone other than Trump and his amen chorus.

So, since we need a substitute, I suggest decoy news. Because that’s what we’re talking about: fabricated news meant to look like the real thing.

But the problem is bigger than news alone, because advertising-funded media have been in the decoy business since forever. The difference in today’s digital world is that it’s a lot easier to fabricate a decoy story than to research and produce a real one—and it pays just as well, or even better, because overhead in the decoy business rounds to nothing. Why hire a person to do an algorithm’s job?

In the content business the commercial Web has become, algorithms are now used to target both stories and the advertising that pays for them.

This is why, on what we used to call the editorial side of publishing (interesting trend here), journalism as a purpose has been displaced by content production.

We can see one tragic result in a New York Times story titled In New Jersey, Only a Few Media Watchdogs Are Left, by David Chen (@davidwchen). In it he reports that “The Star-Ledger, which almost halved its newsroom eight years ago, has mutated into a digital media company requiring most reporters to reach an ever-increasing quota of page views as part of their compensation.”

This calls to mind how Saturday Night Live in 1977 introduced the Blues Brothers in a skit where Paul Shaffer, playing rock impresario Don Kirshner, proudly said the Brothers were “no longer an authentic blues act, but have managed to become a viable commercial product.”

To be viably commercial today, all media need to be in the content production business, paid for by adtech, which is entirely driven by algorithms informed by surveillance-gathered personal data. The result looks like this:

To fully grok how we got here, it is essential to understand the difference between advertising and direct marketing, and how nearly all of online advertising is now the latter. I describe the shift from former to latter in Separating Advertising’s Wheat and Chaff:

Advertising used to be simple. You knew what it was, and where it came from.

Whether it was an ad you heard on the radio, saw in a magazine or spotted on a billboard, you knew it came straight from the advertiser through that medium. The only intermediary was an advertising agency, if the advertiser bothered with one.

Advertising also wasn’t personal. Two reasons for that.

First, it couldn’t be. A billboard was for everybody who drove past it. A TV ad was for everybody watching the show. Yes, there was targeting, but it was always to populations, not to individuals.

Second, the whole idea behind advertising was to send one message to lots of people, whether or not the people seeing or hearing the ad would ever use the product. The fact that lots of sports-watchers don’t drink beer or drive trucks was beside the point, which was making brands sponsoring a game familiar to everybody watching it.

In their landmark study, “The Waste in Advertising is the Part that Works” (Journal of Advertising Research, December, 2004, pp. 375–390), Tim Ambler and E. Ann Hollier say brand advertising does more than signal a product message; it also gives evidence that the parent company has worth and substance, because it can afford to spend the money. Thus branding is about sending a strong economic signal along with a strong creative one.

Plain old brand advertising also paid for the media we enjoyed. Still does, in fact. And much more. Without brand advertising, pro sports stars wouldn’t be getting eight and nine figure contracts.

But advertising today is also digital. That fact makes advertising much more data-driven, tracking-based and personal. Nearly all the buzz and science in advertising today flies around the data-driven, tracking-based stuff generally called adtech. This form of digital advertising has turned into a massive industry, driven by an assumption that the best advertising is also the most targeted, the most real-time, the most data-driven, the most personal — and that old-fashioned brand advertising is hopelessly retro.

In terms of actual value to the marketplace, however, the old-fashioned stuff is wheat and the new-fashioned stuff is chaff. In fact, the chaff was only grafted on recently.

See, adtech did not spring from the loins of Madison Avenue. Instead its direct ancestor is what’s called direct response marketing. Before that, it was called direct mail, or junk mail. In metrics, methods and manners, it is little different from its closest relative, spam.

Direct response marketing has always wanted to get personal, has always been data-driven, has never attracted the creative talent for which Madison Avenue has been rightly famous. Look up best ads of all time and you’ll find nothing but wheat. No direct response or adtech postings, mailings or ad placements on phones or websites.

Yes, brand advertising has always been data-driven too, but the data that mattered was how many people were exposed to an ad, not how many clicked on one — or whether you, personally, did anything.

And yes, a lot of brand advertising is annoying. But at least we know it pays for the TV programs we watch and the publications we read. Wheat-producing advertisers are called “sponsors” for a reason.

So how did direct response marketing get to be called advertising ? By looking the same. Online it’s hard to tell the difference between a wheat ad and a chaff one.

Remember the movie “Invasion of the Body Snatchers?” (Or the remake by the same name?) Same thing here. Madison Avenue fell asleep, direct response marketing ate its brain, and it woke up as an alien replica of itself.

It is now an article of faith within today’s brain-snatched advertising business that the best ad is the most targeted and personalized ad. Worse, almost all the journalists covering the advertising business assume the same thing. And why wouldn’t they, given that this is how advertising is now done online, especially by the Facebook-Google duopoly.

And here is why those two platforms can’t fix it: both have AI machines built to give millions of advertising customers ways to target the well-studied eyeballs of billions of people, using countless characterizations of those eyeballs.nIn fact, the only (and highly ironic) way they can police bad acting on their platforms is by hiring people who do nothing but look for that bad acting.

There are only two fixes that can work.

One fix is regulation. We now have that, hugely, with the General Data Protection Regulation (GDPR). It’s an EU law, but it protects the privacy of EU citizens everywhere—with potentially massive fines. In spirit, if not also in letter (which the platforms are struggling mightily to weasel around), the GDPR outlaws tracking people like tagged animals online. I’ve called the GDPR an extinction event for adtech, and the main reason brands (including the media kind) need to fire it.

The other fix is personal, meaning ways each of us have to manage all our dealings with other entities online. I explain this in Giving Customers Scale, and in many other posts, columns and essays compiled in my People vs. Adtech series. I’d say more about all of it, but need to catch a plane. See you on the other coast.

Meanwhile, the least we can do is start talking about decoy news and the business model that pays for it.

 

 

 

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Journalism is in a world of hurt because it has been marginalized by a new business model that requires maximizing “content” instead. That model is called adtech.

We can see adtech’s effects in The New York TimesIn New Jersey, Only a Few Media Watchdogs Are Left, by David Chen. His prime example is the Newark Star-Ledger, “which almost halved its newsroom eight years ago,” and “has mutated into a digital media company requiring most reporters to reach an ever-increasing quota of page views as part of their compensation.”

That quota is to attract adtech placements.

While adtech is called advertising and looks like advertising, it’s actually a breed of direct marketing, which is a cousin of spam and descended from what we still call junk mail.

Like junk mail, adtech is driven by data, intrusively personal, looking for success in tiny-percentage responses, and oblivious to harms it causes, which include wanton and unwelcome surveillance, annoying the shit out of people and filling the world with crap.

But adtech is far worse, because it also funds hyper-partisan news flows, including vast rivers of fake news, much of it from pop-up publishers that are as fake as the clickbait they maxiize. Without adtech, fake news would be marginalized to the digital equivalent of supermarket tabloids.

Here’s one way to tell the difference between real advertising and adtech:

  • Real advertising wants to be in a publication because it values the publication’s journalism and readership.
  • Adtech wants to push ads at readers anywhere it can find them.

Here’s one way to tell the difference between journalism and content:

  • Journalism has ethics.
  • Content has volume.

Another:

  • Journalism is supported by advertising and subscriptions.
  • Content is supported by adtech.

Companies advertising in the old publishing world were flattered to appear in publications like the Star-Ledger. They were also considered sponsors of those publications.

Companies advertising in the new publishing world are drunk on digital and want to maximize the “big data” they acquire. And there are thousands of bartenders to help with that.

As I wrote in Separating Advertising’s Wheat and Chaff, in the new publishing world “Madison Avenue fell asleep, direct response marketing ate its brain, and it woke up as an alien replica of itself.”

That’s also why, to operate in publishing’s new alien-built economy, journalists need to meet that “ever-increasing quota of page views.” Better to “generate content” than to do the best journalism we can, the proposition goes. It’s still a losing one.

See, adtech doesn’t care about journalism, because its economy incentives maximizing the sum of content in the world, so it has as many places as possible to chase followed eyeballs with ads. Case in point, from @WaltMossberg:

About a week after our launch, I was seated at a dinner next to a major advertising executive. He complimented me on our new site’s quality and on that of a predecessor site we had created and run, AllThingsD.com. I asked him if that meant he’d be placing ads on our fledgling site. He said yes, he’d do that for a little while. And then, after the cookies he placed on Recode helped him to track our desirable audience around the web, his agency would begin removing the ads and placing them on cheaper sites our readers also happened to visit. In other words, our quality journalism was, to him, nothing more than a lead generator for target-rich readers, and would ultimately benefit sites that might care less about quality.

If Recode insisted on real ads, rather than coming to depend on surveillance-based adtech, its advertisers would have valued the publication, and not just the eyeballs of its readers, wherever it could find them.

Walt concludes,

It’s no easy task to either make money online as a publisher or to advertise your product in a world where attention is so fleeting and divided. But the current system of ad-supported web content isn’t working for readers and viewers. It needs to be reset.

The ad business is too brain-snatched to do that reset alone. It needs help from readers and brave publishers willing to stop participating in the adtech game.

As I explain in How customers can debug business with one line of code (hashtag: #NoStalking), each of us can come to publishers with a simple term that says “Just show me ads not based on tracking me.” In other words, “Give us real advertising. We can live with that.”

#NoStalking is not only in the works at Customer Commons, but saying yes to it will be an ideal move by companies wishing to obey the General Data Protection Regulation (aka GDPR), which will start punishing stalking severely, starting in 2018.

While the GDPR will blow up adtech as we’ve known it, #NoStalking will save real advertising, and the best of ad-supported publishing along with it, because it will bring economic incentives back into alignment with journalism. We had that in the old ad-and-subscription supported world of offline journalism, and we can get it back in the new world of online journalism. As I explain in Why #NoStalking is a good deal for publishers,

Individuals issuing the offer get guilt-free use of the goods they come to the publisher for, and the publisher gets to stay in business — and improve that business by running advertising that is actually valued by its recipients.

So, if you want to save journalism, the best of publishing and civil discourse that depends on both, bring back real advertising and cure the cancer of adtech.

For more help with that, go back and read Don Marti’s Targeting failure: legit sites lose, intermediaries win. You might also visit the Adblock War Series at my blog.

Two bonus links:

  1. Don Marti‘s What The Verge can do to help save web advertising
  2. Ethan Zuckerman’s It’s Journalism’s Job to Save Civics.

The original version of this post was published in Medium on 23 January 2017. This is an experiment in publishing first in Medium and second here. We’ll see how it goes.

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amsterdam-streetImagine you’re on a busy city street where everybody who disagrees with you disappears.

We have that city now. It’s called media—especially the social kind.

You can see how this works on Wall Street Journal‘s Blue Feed, Red Feed page. Here’s a screen shot of the feed for “Hillary Clinton” (one among eight polarized topics):

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Both invisible to the other.

We didn’t have that in the old print and broadcast worlds, and still don’t, where they persist. (For example, on news stands, or when you hit SCAN on a car radio.)

But we have it in digital media.

Here’s another difference: a lot of the stuff that gets shared is outright fake. There’s a lot of concern about that right now:

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Why? Well, there’s a business in it. More eyeballs, more advertising, more money, for more eyeballs for more advertising. And so on.

Those ads are aimed by tracking beacons planted in your phones and browsers, feeding data about your interests, likes and dislikes to robot brains that work as hard as they can to know you and keep feeding you more stuff that stokes your prejudices. Fake or not, what you’ll see is stuff you are likely to share with others who do the same. This business that pays for this is called “adtech,” also known as “interest based” or “interactive” advertising. But those are euphemisms. Its science is all about stalking. They can plausibly deny it’s personal. But it is.

The “social” idea is “markets as conversations” (a personal nightmare for me, gotta say). The business idea is to drag as many eyeballs as possible across ads that are aimed by the same kinds of creepy systems. The latter funds the former.

Rather than unpack that, I’ll leave that up to the rest of ya’ll, with a few links:

 

I want all the help I can get unpacking this, because I’m writing about it in a longer form than I’m indulging in here. Thanks.

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I started calling online advertising a bubble in 2008.

I made “The Advertising Bubble” a chapter in The Intention Economy in 2012.

I’ve been unpacking what I figure ought to be obvious (but isn’t) in 52 posts and articles (so far) in the Adblock War Series. This will be the 53rd.

And it ain’t happened yet.

But, now comes this, from Kalkis Research:

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Some charts:

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And here is their downbeat conclusion:

We are living through the latest stages of the online advertising bubble, as available high-quality ad space is shrinking, leading to a decline ad space quality, and a decline of ad efficiency. Awareness for fraud is growing, and soon, clients will cut their online ad spending, and demand higher accountability. This will destroy the high-margin market of automated reselling worthless ad space, and will force advertisers to focus only on prime publishers, with expensive ad space.

This is a re-run of the online advertising crash of the early 2000s, when the proliferation of banners and pop- ups destroyed any value these ads had (and led people to install pop-up killers, just like with ad blockers today)…

We estimate that the online advertising market has been artificially inflated since the end of 2013, and is much more mature than its pundits are claiming. 90% of Google’s revenues come from advertising. We expect Alphabet’s share price to go down by 75%…

A larger number of companies will be impacted, as a growing number of third-party tech giants are involved in the advertising play (Oracle, Amazon, Salesforce), and we expect the whole tech sector to be hard hit by the unwinding of the bubble…

Currently, January 2018 Alphabet puts with a strike of $400 are trading at around $8, for a 20x return should our scenario materialize.

There are other signs. For example, a falling ping-pong table index:

pingpongtable

GroupM, the “world’s largest media investment group,” also just published Interaction 2016, which is also bearish on adtech:

Advertisers and the entities that place their ads have always sought relevance and engagement; the consumer has chosen to set a higher bar. Advertisers and the buyers of media have a further responsibility.

Until now, we have assumed almost all data are worth having. But however much he gathers, no advertiser commands complete, continuous data. This creates a risk that the advertiser’s left hand may not know what his right hand is doing. A customer who has already made a purchase may be bombarded with redundant repeat ads wherever he roams: what we might call the phenomenon of “repetitive irrelevance.” Even worse, several advertisers may be sharing the same data and using performance-oriented media, multiplying the “repetitive irrelevance.” Tracking and targeting intended to make advertising welcome makes it a nuisance. It is dysfunctional. The advertiser damages his reputation and pays to do so.

This brief analysis suggests that a partial solution to adblocking is a combination of design, technology, common sense and the ability to establish the point, across channels and vendors, at which the application of a particular data point becomes the poison of marketing rather than the antidote to ineffectiveness.

The emphasis is mine. (Hey, I know boldface tends to get read and blockquotes don’t.)

There are other signs. Last May Business Insider said The ad tech sector looks an awful lot like a bubble that just popped. In June, The Wall Street Journal said adtech investment dollars are running dry. “These companies are struggling to even get meetings,” they said. In December Ad Exchanger called 2015 a “reality check” year for adtech.

Clearly the end isn’t near for Facebook or Google. Tony Haile, founding CEO of Chartbeat — and to me the reigning king of adtech moneyball — compares Facebook to the Sun, and everybody else to planets and other debris orbiting around it. One pull-quote: “It is Facebook that curates and distributes. It owns the relationship with the user, and decides what content the user sees and how many see it.” Meanwhile Google, which places a huge percentage of online ads (for itself and countless others), is said by Digiday to be exploring an “acceptable ads” policy obviously modeled on the one launched by Adblock Plus. And while ad fraud has been bad, AdAge reports that it’s down, dramatically: “analytics firm Integral Ad Science found a 20.9% decrease in both overall and programmatic ad fraud last quarter compared to the fourth quarter of 2015.”

Still, I’ve been told by one (big) adtech exec that his business is “a walking zombie” and that he’s looking toward “the next paradigm.” One of the biggest online advertisers told me late last year that they yanked $100 million/year out of adtech and put it into traditional advertising for one simple reason: “It didn’t work.” I have a sense that they are not alone.

Got any more examples? I want us to get as clear a picture as we can of the adtech edifice as it starts crumbling to the ground. Or not. Yet.

(Later…) Okay we have some:

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[Update on 3 January 2016: Buzzfeed reports that Apple is killing iAd and getting out of that business, ending the conflict I detail below. For a look at what I am sure is behind that decision, scroll down to “Sacrificing its adtech business…”.]

A couple weeks ago, I posted Separating advertising’s wheat and chaff, contrasting privacy-respecting brand advertising (the wheat) with privacy-offending tracking-based advertising (the chaff), better known in the industry as “adtech.”

Apple pushes both, through its own advertising business, called iAd. The company is also taking sides against both — especially adtech — by supporting Content Blocking in a new breed of mobile phone apps we can expect to see in iOS 9, Apple’s next mobile operating system, due next month.

In Apple’s Content Blocking is chemo for the cancer of adtech, which I posted a few days ago, I visited the likely effects of content blocking. Since then a number of readers have pointed to posts about iAd and the opt-out choices Apple provides for advertising on iPhones and iPads.

Both iAd and the opt-outs reveal that Apple is as much in the adtech business as any other company that tracks people around the Net and blasts personalized advertising at them.

Apple also appears to be taking sides against adtech with its privacy policy, which has lately become more public and positioned clearly against the big tracking-based advertising companies (notably Google and Facebook). In September of last year, for example, Apple put up a new pageapple.com/privacy — that contained this paragraph:

Our business model is very straightforward: We sell great products. We don’t build a profile based on your email content or web browsing habits to sell to advertisers. We don’t “monetize” the information you store on your iPhone or in iCloud. And we don’t read your email or your messages to get information to market to you. Our software and services are designed to make our devices better. Plain and simple.

What we have here, then, is Apple’s massive B2C business in conflict with one of its B2B businesses. Since there is a lot of history here, let’s review it.

On 8 July 2010, Engadget published iAds uses iTunes history, location information to target advertising. It begins,

We’ve heard about this before, but now that it’s up and running, this is probably worth a revisit. Apple’s iAds system actually uses lots of your information, including your iTunes purchasing history, location data, and any other download or library information it can suss out about you, to determine what ads you see. So say a few marketing firms working with the large companies now buying and selling iAds.

A recent series of ads for soap was able to target “married men who are in their late 30s and have children.” That’s very specific, and when Apple rolls out the full program, it’ll even be able to use things like iBooks purchases and iTunes movie and TV downloads to target you with advertising.

On 15 October 2014, Digiday published Apple revamps mobile ads with retargeting options. It begins,

Apple’s release of its new mobile operating system last month came with an overlooked gift for marketers: the ability to retarget ads based on users’ in-app browsing behaviors.

According to ad agencies, Apple is actively pitching the new capability as a way to effectively solve the mobile cookie problem.

Say, for example, a visitor to a retailer’s iPhone app adds a pair of shoes to his cart but ultimately decide not to buy it. In this scenario, the retailer will now be able to retarget that user with an ad for that exact pair — even in another app on his iPad. When tapped, the ad would direct him back to his abandoned checkout page and automatically add the shoes to his online shopping cart.

That was when iAd was new. Since then it has come to be regarded, at least by the online press, as something of a failure. On 16 Ocbober 2014, Business Insider published Here’s Apple’s Plan To Turn Around iAd, One Of Its Biggest Flops. The gist:

Several sources have confirmed to Business Insider that Apple is currently visiting mobile specialists at the top media agencies in New York City to push the new function. (Cross-device retargeting.)

Cross-device retargeting is of most use to retailers: if a customer spends some time looking at a dress on their iPad app but decides not to buy it, that same retailer can “retarget” them with an ad displaying an image of that dress, options to buy, or directions to the store when they next pick up their iPhone.

On 19 November 2014, AdExchanger published iAd starts selling programmatically, and explains how it works:

iAd has more than 400 targeting options for advertisers. Its audience is also validated, since users must create an iTunes account in order to download apps. With the release of iOS 8, Apple announced that those Apple IDs could be used by iAds advertisers to retarget users across their devices. Those capabilities make it a good fit for advertisers doing audience-based targeting, who often prefer transacting in programmatic channels.

iAd has scale: “Apple iAd’s sell-side SDK is one of the most penetrated SDKs in the industry,” said Michael Oiknine, CEO of Apsalar. “They now have added iTunes radio inventory, so it’s a smart yield maximization strategy for Apple and is akin to Facebook strategy, which maximizes inventory sales via FBX and PMDs.”

On 21 November 2014, Venturebeat published Apple and AdRoll enable iOS ad retargeting — with extra data from iTunes and the App Store. It begins,

In a significant move for the mobile advertising industry, Apple and retargeting leader AdRoll have announced a partnership that will see AdRoll providing its retargeting and programmatic buying capability for iAd. In addition, Apple will enable advertisers to target potential customers via access to its proprietary data sets from iTunes and the app store.

On 21 November 2014, AdWeek published Get Ready for More Mobile Ads on Your iPhones as Apple Launches New iAds. The gist:

Today, Apple is unveiling partnerships with companies like AdRoll, which will flip a switch and start serving iAds through its automated marketing platforms. This turn toward programmatic mobile advertising has been in the works for at least a year. Last year, the company stopped treating iAd like a high-end marketing platform for only the top brands with the most cash.

Apple wanted to build a self-serve mobile advertising system in house, and it bought Quattro Wireless to help. Sources said that effort faltered, and Apple decided to partner with ad tech companies like AdRoll and The Rubicon Project to compete with mobile ad giants like Facebook, Google and Twitter.

AdRoll is a retargeting specialty firm that lets marketers use their own consumer data profiles to deliver ads across such platforms. And Rubicon unexpectedly leaked word earlier this week that it was partnering with Apple.

On 22 January 2015, ExchangeWire asked What will Apple’s Ad Tech Play look like? They say,

Apple’s renewed designs on the advertising business were revealed when it was announced it was to start selling its iAd inventory on a programmatic basis, with several firms including MediaMath, Rubicon Project, among others, over four years after its iAd unit was initially launched, asking advertisers for (the then audacious sum of) $1m per campaign on its iOS devices.

Since launch, Apple’s presence in the advertising business has been largely underwhelming (apart from its own spend). But the revelation it had chosen several supply-side platforms (SSP) to sell programmatic guaranteed opportunities on behalf of the 250,000-plus App Store developers indicated its renewed designs on the sector.

The announcement itself made waves, not least because of the bungled nature of the announcement,which itself raises a number of issues to debated about Apple’s influence in the ad tech sector (more on that later).

The initial announcement read: “Apple’s iAd provides 400-plus targeting options to advertisers, based on hundreds of millions of validated iTunes accounts worldwide. This rich first-party data asset makes it easy for buyers to target the specific mobile audiences of their choice.”

The move represented, for the first time, that Apple is willing to loosen control over its first-party iTunes data with advertisers expected to be willing to pay top dollar for the access.

They add,

Apple has since started to advertise for roles within its iAd business, requesting applications for UK candidates to join its iAd Marketplace Sales Organisation.

Among the skills requested are: “Apple’s customers on the various products iAd has to offer as well as how to leverage iAd’s self service buying platform, iAd Workbench.”

In addition: “Third-party tags familiarity a plus.”

What is clear, from all these pieces and many others like them, is that Apple’s adtech business is little if any different from the rest of them — meaning just as creepy and privacy-abusing — and notable as well for failing to live up to its original ambitions, which were both huge and (via Business Insider) outlined by Saint Steve himself:

At launch, Jobs set out the bold ambition that iAd would capture 50% of the mobile ad market. Apple marketed iAd as a best-in-class solution for advertisers because it owns both the hardware and operating system the ads ride on and gains valuable data when people sign up for Apple ID to register for iTunes accounts. That means it can target ads by age, gender, home address, iTunes purchases and App Store downloads.

However, it’s still somewhat behind that lofty 50% target. iAd made up just 2.5% of the mobile ad revenue booked in the US last year, according to eMarketer, behind Google which takes the lion’s share (37.7%) and Facebook (17.9%). The most recent data from IDC states Apple generated $125 million in mobile ad sales in 2012.

Apple’s total sales in FY 2012 were $125 billion, or 1000x its mobile ad sales that year. Put another way, iAd contributed 0.01% to Apple’s sales.

Meanwhile, does any Apple customer want advertising on their iPhone or iPad?

Apple knows the answer to that question, which is why Apple provides ways for you to “limit ad tracking on your iPhone, iPad, or iPod touch” and “ads based on your interests.”* (Just go to Settings > Privacy > Advertising to “Limit Ad Tracking,” and to Settings > Privacy > Location Services > System Services. to turn off “Location Based iAds.”) And soon we’ll have Content Blocking as well.

Sacrificing its adtech business would position Apple in full alignment with three things:

  1. Tim Cook’s privacy statement. It would take the loopholes out of that thing.
  2. Market demand. People are fed up with losing their privacy online — almost all of it to the tracking-based advertising business. (Sources: Pew, TRUSTe, Customer Commons, Wharton.)
  3. The moral high ground called simple human decency. Most people don’t want to be tracked in the online world any more than they want to be tracked in the physical one. Nor do they want information about them known by first parties to be sold to third parties, or to anybody, with our without their knowledge, no matter how normative that practice has become.

Dropping adtech would also be good for iAd, which could then concentrate on placing non-tracking-based brand ads, which are more valuable anyway: to brands, to publishers and to the marketplace. Also to Apple itself, because they would be selling wheat, rather than chaff.

Until then, the loopholes persist in Tim Cook’s privacy statement, and Apple retains major conflicts between its massive B2C businesses and its struggling B2B adtech business.

It will be interesting to see what the company does once the Content Blocking chemo hits the App Store bloodstream.

* “Based on your interests” (aka “interest based advertising“) is a delusional conceit by both adtech (examples here , here and here) and online retailing (prime example: Amazon). Neither visiting sites nor buying are measures of interests. All they show are actions that could mean anything — or nothing.

The interest-based advertisers say our interests are “inferred” by what we do (and they like to observe, constantly and everywhere). And yet those inferences are weakened by another assumption that is flat-out wrong, nearly all the time: that we are always in a shopping mode. In fact we are not.

We are, in fact, always in an owning mode, which is why I think that’s the real greenfield for e-commerce. If companies shifted a third of what they spend on adtech over to customer service, they would vastly increase both customer loyalty and brand value.

By the way, Apple knows this, possibly better than any other technology company. That’s one more reason why I think their B2C smarts will correct the adtech crowd-following errors of their B2B ways.

[Later…] @JamesDempsey tweets,

iOS 9 content blocking is in Safari. iAds appear in apps—not web pages: iAds not blocked.

Good to know. Apple’s iAd site doesn’t make that clear (to me, at least). What this tells me is that iAd is in the chaff business while Content Blocking encourages wheat on Safari. Doesn’t change the point of this post, or the earlier ones.

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Inpersonalization the pile of comments under the post on Facebook I wrote about here yesterday, Christopher Brock writes a long and thoughtful response that pretty much represents the thinking of the adtech business today. Since it’s hard to respond point-by-point in Facebook’s commenting UI, I’ll do it here:

It is not really fair to say Facebook identifies you as x,y and z.

Yes it is, because Facebook is in the business of delivering personalized ads. True, they also deliver non-personalized ads (ones targeted, say, to a demographic). But since there is no flag on an ad that says it’s one or the other, and because Facebook can get more personal, with more people, than any other advertising platform in the world, it is legit to at least suspect that their ad-placing machine thinks you are x, y or z.

What the ads reflect are the audience demographics approved by businesses willing to purchase impressions against a profile to which you fit in hopes of turning a ROI.

Or because you’re being targeted personally. For example…

Retargeting ads are based on your browsing habits, which can be telling of your historical intent based searches.

Yes, that and a lot of other data, some gleaned by surveillance, some bought from Acxiom and other brokers, all crunched in a thing that IBM calls The Big Datastillery. Here’s the graphic:

Datastillery_1500x3002bSee those beakers at the bottom? (Click on the graphic to see it in detail.) That’s you and me.

How is it possible for a company as smart as IBM to insult human beings so obviously? The short and simple answer is, because consumers aren’t human. The term “consumer” presumes that’s all we do: consume. (Jerry Michalski calls consumers “gullets with wallets and eyeballs.”) In the same way that “when all you have is a hammer, everything looks like a nail,” “when all you have is plumbing, every consumer looks like a beaker.”

As for all the plumbing above the beakers, does anybody outside the adtech world know the difference between programmatic (including direct and forwards), predictive, real time bidding (RTB), AB and MV testing, supply side platforms, demand side platforms, marketing and interaction optimization, and all the other valves in the piping that blurps placements of ads through Facebook, other commercial websites and mobile apps? I suppose from the plumbing side it doesn’t matter. But it does to the humans being treated like empty vessels on a conveyor belt. We don’t know what the hell is going on, but we do know that it’s big, creepy and trying to be personal in a robotic way.

By contrast, the provenance of ads in the old advertising world was obvious to everybody. (And if they needed reminding, they got it with Mad Men.) Every ad you read in a newspaper or magazine, heard on the radio, saw on TV or a billboard was placed there either directly by the advertiser or through an agency. And here the key thing: it was never personal. It was aimed at a population. Everybody knew that.

Direct marketing, better known as junk mail, was a very different animal. It was addressed to you personally, and wanted a direct response. Adtech is what we got after direct marketing body-snatched advertising. An ad you see on Facebook might be addressed to populations the old fashioned way, or it might be personal. You can’t tell the difference — unless an ad is obviously personal, in which case it risks falling into the uncanny valley where you might creeped out. At the extreme, perfectly personalized advertising (based on knowing everything about you) is perfectly creepy.

Eith a new market we are served non-relevant ad content, however over time more businesses will move to paid digital ad marketing and the ads we see will become more contextually and intentionally relevant.

And creepy.

I know the best adtech people go out of their way to avoid the uncanny valley. There are also special cases, which also happen to be the two biggest: Facebook and Google.

Facebook is in a position to know people to a high degree of detail. The company is careful not to show that fact (and fall into the uncanny valley), but knowing how personal Facebook can get does make a difference. That’s why I said “If I were actually the person Facebook advertised to…”

Google is less privileged in that respect, but the nature of the help it provides (in search results, in guessing at locations we search for in Maps, and so on) makes their search results and ad placements less of a valley when they get uncanny.

But in general the body-snatched nature of digital advertising leaves us in the dark, nearly all the time, about what’s personal and what’s not.

There is a lot of profit potential for marketers who can accurately design marketing funnels for products/services based on demographic profiling and intentional modeling using a demand side platform like Facebook.

Is that what it is? Man, that is so damn confusing to us beakers. I was in the advertising business (the old Mad Men kind) one way or another, for much of my adult life, and for me — as well as for the rest of the world — the demand side of the marketplace is the whole human population. The supply side is the one selling goods and services to that population.

A few weeks ago I spent an afternoon with an RTB company talking about all this stuff, and my spinal cord kinked as my brain spun around, trying to grok how demand in that business is on the side that produces the ads, rather than the side that consumes them. (Which we mostly don’t, by the way. We ignore 99.x% of them. But we’re still consumers to the ad producers.) As Wikipedia currently puts it,

A demand-side platform (DSP) is a system that allows buyers of digital advertising inventory to manage multiple ad exchange and data exchange accounts through one interface. Real-time bidding for displaying online ads takes place within the ad exchanges, and by utilizing a DSP, marketers can manage their bids for the banners and the pricing for the data that they are layering on to target their audiences. Much like Paid Search, using DSPs allows users to optimize based on set Key Performance Indicators such as effective Cost per Click (eCPC), and effective Cost per Action (eCPA).

Whatever. (And saying that I speak for all people not laboring in the adtech bubble.)

Since marketing data science is relatively new as is social, local and mobile tech, not all businesses buy digital ads.

True. In fact the Internet we know today is only about 20 years old. It showed up when commercial activity could operate there (technically, when NSFnet shut down), in 1995. The cookie was invented around that time as well. (But not for tracking. It was meant originally just to help websites recall and assist prior visitors.)

The Net we made then, and still have, is Eden. We arrived naked there, and we still are. The adtech business loves that, but the rest of us don’t. That’s why privacy is a huge issue online (sources: TRUSTe, Pew, Customer Commons) and a non-issue offline.

In the physical world we’ve had clothing, shelter and other privacy technologies for many thousands of years — and manners for how we treat each others’ private spaces. In the online world, rudeness rules. A merchant who would be appalled at the thought of placing a tracking beacon on a visiting customer, just so that customer can later be “delivered” a better “advertising experience,” doesn’t think twice about doing the same online.

This will change. It’s already happening through regulation, and through ad and tracking blocking rates that steadily increase. But those are stone tools. Eventually we’ll get real clothing and shelter. When that happens, the adtech business will be in trouble, unless it changes, which I’m sure it will.

@docsearle maybe you should be a web marketer

No thanks.

you obviously have identified an area of opportunity.

The area I’ve identified is the one where customers will signal their intentions far better than any marketer can guess at the same.

If you want more and better thinking about all this, I highly recommend what Don Marti has been writing. He, Bob Hoffman and I are voices in the wilderness today. But that will change. The wilderness is already burning.

Image from Personalizing with Purpose, by Paul Dunay in imedia connection.

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Screen Shot 2015-02-18 at 11.07.22 PMYesterday  and I were guests on screen at a  session in Manchester, hosted by Julian Tait (@Julianlstar) and Ian Forrester (@cubicgarden). We talked for a long time about a lot of stuff (here’s a #cmngrnd search featuring some of it); but what seems to have struck the Chord of Controversy was something I blabbed: “Tracking-based advertising is creepy and wrong… and needs to be wiped out.” Martin Bryant (@MartinSFP) tweeted a video clip and a series of other tweets followed. Here’s a copy/paste, which loses a little between Twitter and WordPress):

  1.  and  favorited a Tweet you were mentioned in Feb 17 People dont realise how much worse our experiences with ads would be if they werent personalised
  2.  favorited a Tweet you were mentioned in

    Feb 17 I prefer personalised advertising, and working for a media startu, it’s better for us. But still, many find it creepy

  3.  Feb 17  targeted ads allow new players to enter the market. W/o it, it’s cost-prohibitive and incumbents can only play.
  4.  favorited a Tweet you were mentioned in

    Feb 17 People dont realise how much worse our experiences with ads would be if they werent personalised

  5.   Feb 17  People dont realise how much worse our experiences with ads would be if they werent personalised
  6.  retweeted some Tweets you were mentioned in

    Feb 17: Tracking-based advertising is “creepy and wrong… and needs to be wiped out,” says

  7.  retweeted a Tweet you were mentioned in

    Feb 17: Tracking-based advertising is “creepy and wrong… and needs to be wiped out,” says

  8.  Feb 17 Manchester, England  I prefer personalised advertising, and working for a media startu, it’s better for us. But still, many find it creepy
  9.  Feb 17  I’d like to debate on this topic. I’ll take the side of the advertiser.
  10.  and  favorited a Tweet you were mentioned in Feb 17: Tracking-based advertising is “creepy and wrong… and needs to be wiped out,” says   
  11.  and 5 others retweeted a photo you were tagged in

    Feb 17: Let’s talk the Cluetrain Manifesto… Here’s and .

     Feb 17Manchester, England Tracking-based advertising is “creepy and wrong… and needs to be wiped out,” says

    1.  favorited a Tweet you were mentioned in
      Feb 17 I’d like to debate on this topic. I’ll take the side of the advertiser.
    2.  favorited your Tweet
      22h Wow, that was quick. Thanks! Meanwhile, and will also help.
    3. ha, I’m happy to being proven wrong! That means I’ve learned something. Will follow up…

    4. will to learn about your perspective before we debate 😉

      Embedded image permalink
    5.  favorited your Tweet
      23h:   Read my book first and see if you still want to argue.

So, while Cyrus awaits his copy of the book, I thought I’d share a few links on the topic, before I hit the sack, jet-lagged, here in London.

First, a search for my name and advertising. Among those the one that might say the most (in the fewest words) is this post at Wharton’s Future of Advertising site.

Second, dig pretty much everything that Don Marti has been writing about business, starting with Targeted Advertising Considered Harmful. My case — the one people who like personalized advertising might want to argue with — is Don’s. He became my thought leader on the subject back when he was helping me with research for The Intention Economy, and he’s been adding value to his own insights steadily in the years since. (BTW, I’m not a stranger to the business, having been a founder and creative director for Hodskins Simone & Searls, one of Silicon Valley’s leading ad agencies back in the last millennium.)

When I get a chance I’ll write more on the topic, but for now I need some sleep.,

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