Holy grail, or chalice of poison?
What is your name?
The ad tech bubble.
What is your quest?
To seek the holy grail.
What is your favorite color?
I don't know, what does our database say that your favorite color is? Aaaaaaaaaaaaaaaaa!
Sorry, Monty Python, but it was the first thing I thought of after reading this: “Ultimately advertising should mesh with content and users’ interests. This remains the Holy Grail…” at the OpenX blog. Jonathan Miller, of News Corporation's Digital Media Group (yes, that News Corporation) reflects the conventional wisdom on online advertising really well.
"The more real-time and the more data enriched we get the better the services and the better the experience will ultimately be for the user."
Really? But what's the long-term result of throwing more math at advertising? For another perspective, see Advertising Gets Personal by Samuel Greengard in Communications of the ACM.
Critics believe the inability to control what software and tracking mechanisms are placed on a person's computer is nothing less than a violation. Many Web sites contain a half-dozen to a dozen or more tracking tools or third-party cookies. It is akin to a company installing video cameras and microphones in a home and recording everything that occurs in the household. "When people find out what is really happening, the typical response is 'Are you kidding!'" says Marcella Wilson, an adjunct professor of computer science at the University of Maryland, Baltimore County.
For a long time, ad blocking was a nerdy Internet sideshow. It was easy and effective, but few users did it. I wrote an ad blocker myself, and got one other user—another Linux freak, who rewrote it.
But new attention to the tracking problem, especially the Wall Street Journal's What They Know series, might be changing that. One startup, ClarityRay, is reporting that 9.26 percent of all ad impressions on 100 popular sites are being blocked.
My best guess is that ad blocking is finally catching on for two reasons. First, personalized advertising just sets off people's intuitions about what's creepy. (We've all read the Charles Duhigg piece in the New York Times about how Target tracks who's pregnant and who's not.) Second, it goes back to the whole signaling thing,
As a reader, as soon as it looks like advertising is just for you and not a general statement, it gets less valuable. Why do we leaf through magazine ads, but discard most direct mail unopened? Targeting reduces the signal.
In the long run, the real Holy Grail for this business is software and infrastructure that does a better job on privacy. That way, nobody's creepiness buttons get pushed and ads carry a clear signal of the advertiser's intentions.