Tuesday, August 21, 2007

Cheap media, cheap ads

Seth Godin, master of business 2.0 marketingspeak, had a great riff the other day that rings true for so many digital signage projects that I've either witnessed or have been involved with:

When the ads are cheap (think banners, or cable or AM radio), the content is lousy.

A SuperBowl ad costs a few million dollars to run... so the beer companies and the dot com companies spend millions creating the ad, even if it runs only once. A banner ad that you can buy for $200, on the other hand, appears to be created by a small chipmunk in the secretarial pool.

There's no economic reason for this. You can run that banner ad in a thousand places. You can run that radio ad in 200 cities. If the media is cheap, it might just be a good value. And if you can run an effective ad, you can run it far and wide and turn a profit.

Or you could just run a cheap ad.

You and I can probably both think of a dozen digital signage networks where we've witnessed this effect. The screens will go live with gorgeous content, professionally-shot video, high-end animations, and the like. Six months out, the content budget will have dwindled, or maybe it's taking longer to attain a positive ROI, but whatever the issue, the content takes a turn for the worse. Advertisers become stingy, network operators are happy to get anything fresh at all, and consequently everybody settles for a much lower quality of content than they did in the beginning.

What's the solution? Well, from a technology standpoint it's getting easier and easier to make good looking content. Not great content, mind you. That will never be easy. But more powerful tools can get you further into "good" territory than ever before. From a business standpoint, as more digital signage standards emerge (for things like content resolution, file format, spot length, etc.), and as more networks become available to advertisers (either independently, or through some kind of aggregation network), the potential value of each spot should increase. According to Godin's theory above, if you can run an effective ad far and wide, it should be profitable.

One thing's for sure, though: while content doesn't have to be expensive to be great, cheap, uninspired spots will never perform well. And if you can't turn a profit running your ads, why bother running them at all?

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Unknown said...

Well said, Bill!


Bill Gerba said...

Thanks, Carre`, though I think that Seth Godin has to take some of the credit here :)

Still, why so many people continue to spend millions of dollars to put up a big digital signage network and then stock it full of nickel-and-dime ads just baffles me.