The Death of Banner Ads

As long as I’ve been online, the Internet has been packed with advertisements. The majority of these ads are banner advertisements, the simple display ads that populate every site from ESPN to Gmail. Thankfully, the old, boring banner advertisement is slowly dying. In the past, everyone who visited a webpage in a set period of time was served the same banner advertisement.  Since their inception, banner ads have employed very basic, unimpressive technology that does little to optimize the dollars spent on the ad. This is changing as ads become tailored to the unique visitor. The evolution of online advertising from the basic banner ad benefits all parties: users (who probably prefer consuming higher quality advertisements), the advertising party (who is producing more effective advertising), and the company selling the ad space (with higher conversion rates come larger revenues).

Everything in red is advertisements. These panels take up most of the screen!!

One of the more exciting advertising innovations can be found in social. Because social media and search firms have enormous amounts of data regarding users’ individual interests, they tailor advertisements to the specific user (social or local optimization: i.e., what a users friends like, and what is geographically relevant to the user). More recently however, even tailored advertising seems flawed, as smaller screens (mobile) do not have the space to waste on additional panels. In response, both Facebook and Twitter have introduced native ads, which are placed directly into their users’ respective feeds. By placing native ads directly into a stream, there isn’t any wasted screen space, which must be used sparingly on mobile devices.

Banner ads are generally considered a waste of screen space.  However, as native ads have emerged, firms have begun producing advertisements more appropriate to online consumption. Funny videos or deals that can be easily shared and spread through the social web are becoming commonplace. Essentially, online ads aren’t total crap anymore, and when tailored for a specific audience, they can be much more effective.

Last year, Hulu made a fascinating change to their advertising policy. Going forward, Hulu only charges advertisers for ads watched in their entirety. If a viewer does not watch an entire ad, the advertiser doesn’t pay. First, I doubt there has been much financial fallout from this, as on Hulu, ads are shown between segments of a show. Viewers either close out of a tab before advertisements begin or they wait until the show restarts, as in most cases they have already decided whether to continue watching.  In addition, Hulu must have had lots of data before making this policy change and deemed it worthy. Second, this generous policy allows Hulu to enforce a higher standard for ads on their platform. Premium ads stand out online, so the higher standard may in turn make users happier to consumer ads. Personally, I find the ad content on Hulu to be much better than Youtube, and 100x better than a basic banner advertisement. Hulu delivers outstanding content to me for free, so watching a few premium ads is hardly bothersome.I understand the necessity, and don’t feel taken advantage of.

There had been very little innovation in Internet advertising, but that has changed drastically over the past few years. Tablets and high-definition screens create opportunities for more immersive, full-page ads. Social and local optimization generates more useful content for users. As conversion rates improve, so will the economic strength of the entire digital media ecosystem who depend on advertising for revenues. It’s an exciting prospect.

30-Second Rewind Button Update: Hulu Redesign

Apparently, media/technology industry higher-ups read my blog. Yay.

Last week, Hulu released a major redesign. I quite enjoy it. The redesign is slick and relatively easy to navigate.

However, I want to quickly point out a major addition to their core product, Hulu’s video player. Hulu has added a 10-second rewind button!!

I love the small, set-quantity rewind button. It makes viewing much easier, as in a slow or dull moment I can open Twitter, ESPN, or Gmail quickly, check for any urgent notifications, and switch back to the video. Then, I simply hit the rewind button if desired, and I haven’t missed a step! No more clicking blindly along the unmarked video timeline.

Thoughts going forward:

1) What other intelligent viewing features will be introduced? Maybe ones pertaining to advertisements?

Spotify is intelligent enough that if an advertisement is playing, and I (the user) mute my computer, the ad pauses. I am FORCED into listening. Annoying? Yes. Consumer experience sensitive? No. Smart business decision? Perhaps. I wonder if video players like Hulu will eventually be “intelligent” enough that it will sense when I switch tabs, pausing the commercial and forcing me to watch in entirety. Interesting possibility….

2) YouTube

Will YouTube introduce a similar product? I like what they’ve done recently with their transcription tool. It’s rough but very usable. Maybe we will see a set quantity rewind button in YouTube soon? I hope so. The feature seems especially fitting for a short form video platform like YouTube, where distraction is rampant and occurs often.

——————-
If you like what you read, you should follow me 🙂