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Xiadtech - Introductory Article

Date: 31 March 2022

The Internet introduced digital advertising. Digital advertising has become an enormous business for its technology suppliers. The ad-tech they have developed has enabled any website to easily display advertisements. This has been the key to their huge scale. But has this scale been achieved at the expense of advertisement effectiveness and quality?

Wikipedia states that advertising has been around since 4000 BCE. It has evolved as technology advances made new forms of communications possible. A path progressing through rock paintings, papyrus, town criers, printing, radio, television, and now, the Internet.

The Internet was a big technological step. It enabled one to one, both way communications to affordable user devices. The devices were reasonably standardised with strong programmatic capabilities. Around this, a system involving advertising networks, SSPs DSPs, real time bidding, user profiling, monitoring etc., has evolved.

But in one way, things have not changed much. The way an advertisement is integrated into a web page has not changed that much from the way that advertisements are placed in a printed publication. The content of the advertisement is placed in a rectangle in the medium. Sure, the technology for doing this has changed, but the concept and, the level of sophistication of the integration, remains largely the same.

The reason for this is SCALE. For the digital advertising industry to grow to its extraordinary size, it was imperative that integration of advertisement remains as simple as possible for website developers. By only requiring website developers to paste a script tag into their website, it ensured that any website in the world could do it. A more advanced integration would open a lot of possibilities to improve the effectiveness of internet advertising. However, this would require programming skills to incorporate advertisements into websites – at greater costs to publishers. For the ad-tech industry the money was in scale – not in the quality. In effect, industry scale has been prioritised over advertisement effectiveness.

But what if we prioritised advertisement effectiveness over scaling? How could advertisements be improved with more sophisticated integration? Following are some ideas:

Integration into workflow

The integrations should allow advertisements to be an integral part of the application. Users should not ‘break their rhythm’ when viewing or interacting with advertisements. For example, clicking on an advertisement should display its detail in the same way as accessing detail from other elements of an application (instead of displaying in a new browser tab or window).

User feedback

Give users more opportunities to provide feedback to advertisements. For example, allow them to show interest in ads. If they have a very high interest, generate a lead which is immediately fed back to the advertiser. Users can also specify the information to be included in their advertising profile. This includes allowing them to specify intent if they are currently looking for particular products.

Smarter campaigns

Campaigns can be a linked set of advertisements. Users can progress through the campaign with different routes depending on their profile or the type of interest they express in an advertisement.

If users are specifically looking for a product or service, give them access to filtered feed specifically for that product. The application can use this feed for alerts, real time displays and searching. Make advertising actively work for users.

Reward Users

What is in it for users? You could say: “better targeted ads for them” or the supporting the nebulous compact of “advertisement pays for content”. However, this is unlikely to have cut through. Why not reward them materially?

The ad-tech could calculate a measure of a user’s value to advertisers. Freemium applications could use this measure to give users access to better featured editions (instead of having to pay for these editions).

Support for Resellers

While website owners are typically also publishers, this may not be the case for application owners. Like in the physical world, companies developing applications may focus on the manufacturing (development) and rely on resellers with marketing expertise for distribution of their applications.

In this case, the application’s success depends on resellers being suitably motivated. Receiving a portion of the advertisement revenue will assist with this motivation. The ad-tech should support this.

Ad-tech for applications

The above ideas can be implemented in an ad-tech stack specifically targeting applications. Such ad-tech would be new; with different concepts and requiring learning and new tooling. It may provide a more effective advertising experience, but it would need to overcome the inevitable inertia of any new system in an established industry. With the upcoming changes in third party cookies and the incessant drive by advertisers to get better value for their advertising dollar, maybe it would be accepted.

Would you use such an advertising system?