Digital advertising is the best thing that ever happened to advertising industry, right? Not so according to Frederic Filloux in a piece that was published by the Washington Post this weekend.

Filloux cites two major problems: poor design, and the process by which online ads are bought and sold. With the former, he points to the popularity of ad blockers as evidence that online ads generally "act as repellents to readers." With the latter, Filloux notes that "most technology aspects of the advertising business have slipped out of the hands of those who were supposed to own them."

Sure, there is no shortage of horrid banner ads and generally uninspired campaigns, and there are plenty of things to complain about when it comes to how ads are bought and sold online, but does that mean that digital advertising is "lousy", as Filloux states? Of course not.

There are numerous ways to dissect Filloux's argument, but I'll take the easiest: return on investment. It's a phrase that, somewhat surprisingly, Filloux doesn't mention once in his piece.

Advertising isn't about innovation and technology, nor is it about imagination and design. At the end of the day, the purpose of advertising is to sell products, services and ideas. Sure, innovation, technology, imagination and design can all be important components of effective advertising effective (and they usually are), but in and of themselves, they don't move the needle.

When it comes to selling, it's pretty darn difficult to call digital advertising "lousy." There's a logical reason that businesses collectively spend billions of dollars on search, display and CPA advertising every year: many of them are making money from their digital advertising initiatives.

Using the lowest hanging fruit -- search advertising -- as an example, Google recently estimated that, on average, AdWords advertisers generate $2 in revenue for every $1 spent on AdWords. Furthermore, Google calculates that the total return on investment is $8 for every dollar spent. For those who don't like estimates, it doesn't take too much effort to find numerous case studies from real businesses that are using AdWords to drive revenue.

Search isn't alone. Long written off, recent studies hint that even the lowly display ad may do more to boost sales than previously thought. Last year, for instance, comScore announced that studies it conducted showed that online display ads were "on par with TV advertising" in driving purchases of CPG products.

Given all of the quantitative evidence that online ads can be effective, and the fact that a growing number of businesses are voting with their wallets to allocate more of their advertising budgets to digital, it seems somewhat foolish to brand digital advertising "lousy." That is not to say that Filloux doesn't make some valid criticisms of it. Digital advertising isn't perfect, and there will always be plenty of room for improvement.

But for those involved in digital advertising, it seems far less constructive to have an academic discussion of all the negatives. Instead, we should be focused on identifying what works and finding ways to build scalable campaigns that deliver ROI. Businesses that advertise successfully do this in every medium, and nobody should expect the internet to be any different.

Patricio Robles

Published 1 June, 2010 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (3)

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Nick McGivney

At least - at LEAST - 70% of tv advertising is dross scraped from the bottom of the barrel and much the same can be said of radio. What makes great advertising stand out is how effectively it harnesses its own medium. So when a Pringles banner ad comes along that makes you engage over and over again it should be judged against the backdrop of its medium too. http://www.bannerblog.com.au/2009/06/pringles.php

I haven't read the Post article, but I see the blanket disapproval that all online advertising gets all the time. It's unfair. So much is shiny and impressive about the medium that when shouty, race-to-the-bottom BUY BUY BUY ads don't look as slick as an iPad app everyone says the entire medium is cheap and tacky. Naw! Only 70% of it, mate! Give online advertising a chance. Along with everything else, it's trying to keep up with a breathtaking pace of change that TV or radio in their early years did not have to deal with.

almost 8 years ago

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CTRLmania

Would be great to know the ROI of offline advertising. It's easy to state online advertising is great when knowing you'll earn $2-$8 for every $1 invested. But without knowing if the same investment would have earned less, or more with offline advertising, it doesn't make a great argument to disprove Frederic Filloux.

almost 8 years ago

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Alex Parker

There's a lower barrier to access with online advertising, and it can do things print and TV can only dream of. With new technology, forward-thinking marketers and publishers are finding they can enhance users' experience on the Web. Hulu just unveiled a new plan to help put relevant ads in front of users by simply getting feedback, asking what kind of ads fit their lifestyles. With dynamic display advertising, users can find ads that are relevant to them because these ads understand their browsing habits and their consuming habits so ads are neither intrusive nor so irrelevant you automatically tune them out. What's lousy about that? Alex Parker adbean.net/blog

almost 8 years ago

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