17 December 2008

Google plans to destroy (reinvent) the advertising industry

I am 26 and a fair amount of my life I've spent storing bad karma while working in the advertising industry (from 2001 to 2008). Damn, I even had my own advertising agency for almost 3 years. It's not something I am very proud of (nor ashamed), but it was fairly useful to understand a little about how the big advertising agencies had been sucking blood from their clients. I say this because most ad agencies survive not by creating memorable campaigns, but by buying media to their clients so thet can massively distribute it. That's the main revenue generator for any normal jurassic ad agency - that's why they are only interested in big clients that massively advertise on TV, because that's where the biggest cut is.

But we all know times are chaning and then the new (visionary) agencies started to charge not anymore for the media, but for the ideas, the communication strategy and planning, marketing positioning, the creativity, the campaigns and all that is in fact generated by the agency and is what makes great agencies great. These people clearly understood times were changing, mainly because of technology and how people are fed up of being interrupted by traditional advertising. I was one of these dudes who were charmed by the possibility of change, for example, just read my final paper to university, which the name would be something like: how to use digital videos on internet as a tool to viral marketing.

Still, the old agencies are alive and kicking, because this takes take time. Maybe they will survive much more with this jurassic model, but hey, now we have a major player that will probably start to change the minds of people: Google. With Google's experimental TV-advertising auction, some dude spend only US$500 to reach 330,000 Dish Network subscribers tuned in to the Oxygen, ESPN2, or WPT channels. That's more super cheap for those not into ad business. See more here.

If this goes on (and I believe it will), we will have a large chunk of advertising revenue going from the hands of the ad agencies to clients, small entrepreneurs, freelancers, artists and who knows what more. I think this is healthy - in a future where everyone will have access to media, ad agencies won't be recognized by the amount of people they reach, but by the quality of their message and communication strategies. That will be extremelt healthy for the good professionals, while very dangerous for the bad (or too big and lazy to adapt) ones. But, hey, who cares about bad and lazy people?

It's Google big balls changing the game (again).

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