In a guest post on TechCrunch.com today, by Eric Clemons, a Professor of Operations and Information Management at The Wharton School of the University of Pennsylvania”, who argues that Internet advertising is: “not trusted, not wanted and not needed, and that PPC advertising will not last.””
The Professor’s comments are already making the rounds on Twitter and are certainly controversial enough to get a lot of play. The original post on TechCrunch already has over 350 comments.
First lets look at some of the more interest points from Professor Clemons post:
“””Internet advertising will rapidly lose its value and its impact, for reasons that can easily be understood.””
“””Traditional advertising simply cannot be carried over to the Internet, replacing full-page ads on the back of The New York Times or 30-second spots on the Super Bowl broadcast with pop-ups, banners, click-throughs on side bars.””
“””Pushing a message at a potential customer when it has not been requested and when the consumer is in the midst of something else on the net, will fail as a major revenue source for most Internet sites. This is particularly true when the consumer knows that the sponsor of the ad has paid to have this information, which was verified by no one, thrust at him. “””
“”Indeed, there has to be some way to create websites that do other than provide free access to content, some of it proprietary, some of it licensed, and some of it stolen, and funded by advertising”””.
“”””Advertising will fail for three reasons:
There are three problems with advertising in any form, whether broadcast or online:
- Consumers do not trust advertising.
- Consumers do not want to view advertising.
- And mostly consumers do not need advertising. “””
As for Google the author calls the business model of Pay Per Click ads as one of “”Misdirection or sending customers to web locations other than the ones for which they are searching.”
“”This is Google’s business model. Monetization of misdirection frequently takes the form of charging companies for keywords and threatening to divert their customers to a competitor if they fail to pay adequately for keywords that the customer is likely to use in searches for the companies’ products; that is, misdirection works best when it is threatened rather than actually imposed, and when companies actually do pay the fees demanded for their keywords. Misdirection most frequently takes the form of diverting customers to companies that they do not wish to find, simply because the customer’s preferred company underbid.”””
“”””Google it seems ultimately to be unsustainable. More significantly from the perspective of this post, it is not scalable; it is not possible for every website to earn its revenue from sponsored search and ultimately at least some of them will need to find an alternative revenue model.
“””Misdirection will fail totally and completely.”””
So here’s out take:
The Professor doesn’t know what he’s talking about.
All advertising from the beginning of time, and in all forms has been “thrust upon the audience”.
This is not a new development.
Television, print, radio and Internet; ads are mixed with content.
Billboards push themselves on your drive to work, subway signs stare at back as you look for a distraction from the train ride.
The Professor’s first finding, that people do not want advertising, is incorrect.
People like advertising.
Studies show that almost 50% of viewers with a hard drive TV system, still watch the ads, rather than skip through them.
The are still plenty of 1/2 hour infomercials running all over the country each day on local and national cable TV networks
Many people read fashion magazines just for the ads.
There are even publications that are almost, all ads, like the Dupont Report, and the Robb Report.
Actually adverting has never changed in its basic essence: inform and entertain; show off your product and tell the viewer why that want or need the product.
No advertising has not changed, just its location.
Advertising dollars have moved away from traditional media.
Newspapers are dead.
Yellow Pages, Dead.
Traditional radio ads dollars continues to shrink.
More ad dollars have and will continue to move to the net.
Which brings us to the good Professor’s claims regarding Google specifically, and PPC ads in general.
Google will continue to flourish, and PPC will continue grow, as long as the ad results match the users search criteria.
People are searching for information.
As long as they users get relevant results they will continue to click, be it a paid click or a free one.
Professor got friend named “alzheimers” methink…
Thanks to Adwords + OVT I was able to grow my online business at 4-digit percentage rate (after it became bigger “only” 3-digit). At the start I was getting leads so cheaply I could not believe that. Lead did cost me single-digit but was worth 3-digit USD amount. Now I pay per lead 4-time more than in 2002/2003 but still is the cheapest advertisement.
The Professor’s opinion upset me so much this morning that I cried all the way to the bank.
Hey David,
“… give me an issue, i’ll give you a tissue.”
-Lou Reed
What utter rubbish. He is the perfect example of institutional detachment from the real world. Most guys in the domaining world would buy and sell him on a daily basis.
The internet for the most part is a level playing field where your educational background is much less relevant than your entrepreneurial flair.
LOL….
there are rumors that advertising won’t work on the intranets…
I think in many areas, particularly those related to tech/computers, advertising will indeed continue to suffer. People are researching the best quality and the best bang for the buck. And I think it will effect the values of related domains and websites. 5 years ago laptop.com or a popular website about laptops would have been very valuable. Today, a new laptop to me means going to Dell and looking up their cheapest 15 inch version for the main computer and the cheapest mini laptop for travel laptop ($500 Vostro and $300 mini 9 currently). I have zero need for laptop information or advertising in the future.
It will be interesting to see what will happen in areas that have always been advertising-driven such as fashion. Fashion magazines and their $50k/page messages may fail. And the prof is right that nothing on the web will probably replace them.
Mike.
Good points. My counter would be if advertising was failing it would start with the advertisers. If the ads weren’t working they wouldn’t buy them.
btw You have some grammar and spelling errors in your post. It’s a solid counter but those mistakes can make it look amateur.
Oh yawn.
Just more worthless toilet paper by another ivory tower PhD trying to justify to his dept head and the dean why he shouldn’t be booted out into the real world . . . to find a real job.
Next.
Those who can, do.
Those who can’t, teach (and complain about those who are successful)
Professors teach because they don’t know how to make money running a business. Simple as that.
the Professor needs to return to Gilligan’s Island.
The Prof is a bunch of old BS!!!
Old school-ancient thinking
Journalism101—- send resumes to news print-hoping to get a job at local papers
LMAO
Jon your post has to be one of the most worthless,clueless posts on this entire blog.
This Professor sure does make companies which are spending 10 billion dollars a year just on adwords over Google look pretty stupid.
I bet, he had bought his PhD at a Wallstreet investment firm. As we all know they sell everything even if it is worthless. So much nonsense said by this guy, he must have just crawled out of some ancient cave.
i think the professor who wrote this knows better and did this as a link baiting experiment or other publicity stunt. Look how worked up it gets people? If he is a professor at Wharton he cannot possibly be that naive.
It seems this fake professor has never seen a wheel, tries to tell the world the wheel does not work and will fall apart, and has no idea what a purpose of a wheel is.
People tend to think just because a professor writes something it must be so and he’s a highly credible sources. When reality is always the opposite, most Professors dont know shit from shit when it comes to new tech and real business.
Another newspaper has bitten the bullet and ditched its paper edition in favor of internet only.
“174-year-old Ann Arbor paper to go online only” http://bit.ly/15lJDq
The issue here is and was a reluctance to accept online advertising of mainstream media.
With the Internet being claimed as the fourth Media (Television, Print, Radio), that claim is proving that it is vying for the number one top spot.
Newspapers are waking up to the fact that print news is passe. The sooner this realization sinks in the sooner many of these media companies can immediately begin saving money.
I know these very people who once proclaimed that the internet will never replace the printed news.
The professor needs to retire… I applaud the effort though — too bad it’s way off base.
The internet is blossoming each and every day and advertising is what drives the expansion.
Follow the money… Doh!
lol, google rules !. more advertising, more money![🙂](https://s.w.org/images/core/emoji/15.0.3/svg/1f642.svg)
One thing that has not and will not change over time is ‘curiosity’. Google ads are inviting and easy.
This blog post is really unnecessary.
What drives google, yahoo, facebook ?
1 word!! ADVERTISING!!!!!
Putting a post like this into a den of domainers is like putting a kitten into a cage of cranky pit bull terriers.
I believe what Clemons meant was that digital media in its various shades can have a rather rude way of sneaking up on you when you least expect to bash your nogger. Ahh, the wonders of technology.
The point about PPC as “misdirections” probably refers to the character limitation of text ads to explain more about what’s up ahead. It’s somewhat similar to going to what you think is a cheap eatery on first looks only to be charged Ritz prices, or get beaten up.
“Advertising” as used by Clemons probably refers to what we in the trade call “Interruptive Advertising” aka the used car salesman shouting saliva into your face, as opposed to the more humane engagement-centric Marketing Communications models being, or trying to be, practised today. While some may see this as a pure semantic play, I can only say, to save boring you to death with the details, it isn’t.
Keep the flame burning, domainers. I’ve been reduced to a mere mortal trying to develop thingies![🙁](https://s.w.org/images/core/emoji/15.0.3/svg/1f641.svg)
Let’s just say that is why he is a professor. He professes to know what he is talking about without the know how to actually prove or disprove it. Like I have been saying….The “Know nothings” are in charge. The “Know nothings” teach our kids. They have people teaching about domains in universities. Anyone here ever get contacted by one of them looking for FACTS?? Who qualified them?
Guys, let the old man go. He just wanted publicity, that’s all.![🙂](https://s.w.org/images/core/emoji/15.0.3/svg/1f642.svg)
“They have people teaching about domains in universities. ”![🙂](https://s.w.org/images/core/emoji/15.0.3/svg/1f642.svg)
Just another example that just because someone is supposedly educated in a formal environment does not mean that they have all the answers, or even some of them.
As an online marketer for over 14 years and a domainer I found his comments to be completely off the mark, there wasn’t a single statement he made that was factual and as you pointed out, newspapers and yellow pages are dead.
We spend in excess of 20k per month on PPC for just two of our businesses and that generates profits for us of well over 30k per month after the PPC expenses.
Sorry, professor but you need to go back to school, perhaps this time in the REAL world.
Gregg
He is doing what many politics do, talking about something he doesn’t know trying to sound like an expert. This is old politics. Some outsiders will believe absurds when told by well articulated people.
This guy reminds me of what my father use to say every day….”I thank God I never graduated from high school”. He died a multi-millionaire.
The professor has a great point. And it shows in the real world. Adwords performance is sub-par compared to organic search. People trust organic and social proof, not who pays the most for an ad. I receive infinitely more ROI on my organic search campaigns versus any pay-per-click.
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