Advertising Industry… from Creatives to Engineers and Data Scientists

There was a time, which I remember early in my career, where many people, especially business graduates were fascinated by the advertising business, it probably began when sellers of consumer products and their ad agencies controlled the contents of the radio programming and later TV programming to which people listened.

New Yorker critic Ken Auletta states that Mad Men’s Don Draper would not recognize today’s ad business. The industry was once dominated by creatives and clients producing ads for print, radio, and TV and later outdoor media. The modern industry relies on “machines, algorithms, pureed data, artificial intelligence—and on the skills of engineers.” The $2 trillion global business is struggling…to figure out how to sell products on mobile devices without harassing consumers, how to reach millennials accustomed to dodging ads, how to capture consumer attention in an age where choices proliferate, and a mass audience is rare. Marketers and advertisers face baffling choices (hundreds of media channels, billions of smartphones, etc.) and the technological threats, from ad blockers to targeted, computerized ad-buying.

Mad Men ruled advertising in the golden age of advertising which started in the 50’s and ended at around 2000. They are now eclipsed by Math Men—the engineers and data scientists.

The power of Math Men is awesome. Google and Facebook each has a market value exceeding the combined value of the six largest advertising and marketing holding companies. Together, they claim six out of every ten dollars spent on digital advertising, and nine out of ten new digital ad dollars. They have become more dominant in what is estimated to be an up to two-trillion-dollar annual global advertising and marketing business. Facebook alone generates more ad dollars than all of US newspapers, and Google has twice the ad revenues of Facebook. 

In the advertising world, Big Data is the Holy Grail, because it enables marketers to target messages to individuals rather than general groups, creating what’s called addressable advertising. And only the digital giants possess state-of-the-art Big Data.

“The game is no longer about sending you a mail order catalogue or even about targeting online advertising,” Shoshana Zuboff, a professor of business administration at the Harvard Business School, wrote on, in 2016. “The game is selling access to the real-time flow of your daily life—your reality—in order to directly influence and modify your behavior for profit.” “This is the gateway to a new universe of monetization opportunities: restaurants who want to be your destination. Service vendors who want to fix your brake pads. Everyone wants a piece of your behavior for profit. Small wonder, then, that Google recently announced that its maps will not only provide the route you search but will also suggest a destination.”

As Ken Auletta points out, Everyone in advertising strives to eliminate risk by perfecting targeting data. Protecting privacy is not foremost among the concerns of marketers; protecting and expanding their business is. The business model adopted by ad agencies and their client’s parallels with Facebook and Google’s. Each aims to massage data to better identify potential customers. Each aims to influence consumer behavior.

Google, for its part, has merged all the data it collects from its search, YouTube, and other services, and has introduced an About Me page, which includes your date of birth, phone number, where you work, mailing address, education, where you’ve traveled, your nickname, photo, and e-mail address. Amazon knows even more about you. Since it is the world’s largest store and sees what you’ve purchased, its data are unrivaled. Amazon reaches beyond what interests you (revealed by a Google search) or what your friends are saying (on Facebook) to what you purchase. With Amazon’s Alexa, it has an agent in your home that not only knows what you bought but when you wake up, what you watch, read, listen to, ask for, and eat. And Amazon is aggressively building up its meagre ad sales, which gives it an incentive to exploit its data. …Big Brother is watching you…

Data excite advertisers, Keith Weed, who oversees marketing and communications for Unilever, describes how mobile phones have elevated data as a marketing tool. “When I started in marketing, we were using second-hand data which was three months old,” he said. “Now with the good old mobile, I have individualized data on people. You don’t need to know their names. You know their telephone number. You know where they live, because it’s the same location as their PC.” Weed knows what times of the day you usually browse, watch videos, answer e-mail, travel to the office—and what travel routes you take. “From your mobile, I know whether you stay in four-star or two-star hotels, whether you go to train stations or airports. I use these insights along with what you’re browsing on your PC. I know whether you’re interested in horses or holidays in the Caribbean.” By using programmatic computers to buy ads targeting these individuals, he says, Unilever can “create a hundred thousand permutations of the same ad,” as they recently did with a thirty-second TV ad for Axe toiletries aimed at young men in Brazil. The more Keith Weed knows about a consumer, the better he can aim to target a sale.

As a lecturer in advertising and marketing communications, it was obvious starting around ten years ago that advertisers were determined to find ways to “precisely” tailor their ads to various segments. But it never occurred to me that marketers could be this precise.

Sooner or later you knew that government was going to step in to protect people’s privacy.

Europe’s new data privacy law has put a small army of tech firms that track people online in jeopardy and is strengthening the hand of giants such as Google and Facebook in the $200 billion global digital advertising industry.

The General Data Protection Regulation (GDPR) brought in by the European Union in May 2018 is designed to protect personal information in the age of the internet and requires websites to seek consent to use personal data, among other measures.

The ability to track internet users has attracted hundreds of companies that harvest and crunch user data from websites – with or without the consent of the site owner – to form very specific individual consumer profiles.

How long the initial impact of GDPR will last, though, is not yet clear as many consumers – tired of the constant permission pop ups – are just giving consent to access sites. Prosecutors are also yet to bring any cases for data breaches.

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