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Digital Advertising is Dead. Long Live Digital Advertising

Digital Advertising is Dead. Long Live Digital Advertising Kristoffer Nelson

Not sure about you, but I’ve heard the drumbeat, “Digital advertising is dead!”

Sure, digital advertising has its issues, but I’m here to tell you that it is alive, well, and growing substantially as a sector in its own right. Meanwhile, all advertising is becoming more and more digitized outright. Soon, digital will consume and integrate entirely into the four great traditional pillars: linear, radio, print, and out of home. Yes, print!

For those beating the digital-advertising-is-dead drum I’d like to bring up three recent events related to major players in the space: Google, Facebook and P&G.

Google

The problem: Brand advertiser creative ended up on YouTube next to extremist videos. Total bummer. A bunch of advertisers pulled ads. OUTRAGE! Digital advertising is dead!

What really happened: Yeah, that really happened. But stuff like this has been happening since people started putting ads in and around digital content. What’s great about digital content is that you get lots of data about what’s happening. The targeting is amazing. The transparency is unparalleled. And Google is the supreme leader of the digital ad ecosystem.

What’s going on now: Almost all of the advertisers are back, and Google’s ad revenue grew nearly 19 percent last quarter, thanks to YouTube video ads and mobile search ads. See, overall, no one cares. Google says sorry, adds a few new tools, and more ad spend pours in.

Facebook

The problem: Remember that whole thing last year when we all found out Facebook was counting video views differently than other platforms and its view throughs were much, much higher than YouTube? And then, everyone was saying: "Oh no, how could you, Facebook? We trusted you. We are so sad. You were so blue and beautiful."

What really happened: That really happened. Everyone freaked out for five minutes. But everyone already knew something was wrong and different – you don’t have 3x the views in one platform in comparison to another platform unless something is drastically different.

What’s going on now: No one cares. Facebook Q1 ad revenue is up 49 percent year over year. Facebook is blue and beautiful again.

P&G

The problem: P&G said they were going to reduce their ad spend by one-third. When you’re the world’s largest advertiser, that’s a lot of money. But when you’re the world's largest advertiser and you cut your spend by a third you’re still spending A LOT of money.

What really happened: That really happened. P&G is going to cut their ad spend by a third. They are not going to accomplish this by cutting out digital. In fact, they just added a second DSP in their mission to buy more via programmatic and they’re bullish on digital.

What’s going on now: P&G has cleaned up their supply chain, removed middle men, adopted more fully integrated tech stacks, and increasingly shifted to auction buys. They’ve also renegotiated agency fees by building agencies just for them with their partners, notably Omnicom’s Hearts & Science.

Recap

Digital advertising isn’t going away. It’s evolving rapidly and growing substantially. Google and Facebook aren’t going away – they accounted for 89 percent of the growth in digital ad spend in 2016, according to a recent IAB report. P&G isn’t moving away from digital – it’s moving towards digital in a different way.

Long live digital advertising!

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