tainly both Peter J. Denning and Jeannette M. Wing have called along this
direction for many years.) Just as in
high-school courses in calculus and
physics, distilled and pure forms may
not just be a good idea as a foundation, prior to utility, but also for their
innate beauties that inspire and subscribe. And though certainly the voices that I heard are to be thanked for
my own arrival, by now it’s clear that
the forms themselves possess a voice
of their own.
from Greg Linden’s
Will Rogers once said,
“Advertising is the art
of convincing people
to spend money they don’t have for
something they don’t need.” According to Will, advertising is inherently
deceptive, and most profitable when
it hoodwinks people into paying more
for something than they should.
Another view is that consumers
lack information and advertising can
provide information. In this view, the
opportunity for deception only exists
because of missing information about
reputations and alternatives. If advertisements are relevant enough to inform consumers, then opportunities
for deception fade.
Ultimately, whether deception or
relevance is more profitable to advertisements may depend on margins
versus conversion rates. Deceptive advertising tends to have high profits on
each sale, but usually very low conversions. Useful advertisements will yield
much tighter margins, but have a much
higher volume of conversions.
An extreme example is email spam,
horribly deceptive advertisements with
awful conversions. And the data there
may give us some hope. One of the
worst forms of deceptive advertising,
email spam appears to be a barely profitable enterprise despite its ubiquity.
This may suggest that deception does
not inherently maximize profits.
Another example is search advertising. By targeting advertising closely to
search keywords and intent, companies like Google have not only made
search advertising very lucrative, but
also relevant and useful to searchers.
In search, ads are highly targeted, rare-
ly deceptive, only occasionally annoying, and often helpful.
But most other forms of advertising
remain irrelevant and annoying. The
most common technique we see still is
broadly blasting ads across all eyeballs.
It would be good to make advertising
more helpful, relevant, and useful to
people. Is it possible?
For a few years now, I have worked
on personalized advertising. Personalized advertising tries to make advertising more useful and relevant to people
by targeting ads to individual interests
Recently, I have been struggling
with a moral question. Let’s say we
build more personalization techniques and tools that allow advertisers
and publishers to understand people’s
interests and individually target ads.
How will our tools be used? Will they
be used to provide better information
to people about useful products and
services? Or will they be used for deeper and trickier forms of deception?
For me, it is an ethical issue that
cuts deep. If personalized advertising
will not be used to benefit people, to
improve the usefulness of advertising,
then I want no part of it. It seems clear
that personalization can make ads
more relevant, but I fear it also could be
possible to use deep knowledge of individual interests to target deceptions.
Which will advertisers do? Which will
be more profitable?
I am hopeful that we can improve
advertising and that advertising will
be most profitable for most advertisers when it is useful and relevant. I am
hopeful that any deceptions will be
marginalized by a flood of more useful alternatives. I remain hopeful that
advertising can move toward a helpful
information stream and away from the
art that Will Rogers deplored.
But, to be quite honest, I sometimes
have doubts about the answer, which is
why I bring it up for discussion. What
do you think? Is advertising an industry fundamentally fueled by deception?
Or is advertising better understood as
a stream of information that, if well directed, can help people?
I think in the perfect case of a
recommender system, advertisements
as such become irrelevant. You’d have a
direct mapping between customer desire
and product awareness. The onus of sales
would be on producing products that
people wanted rather than on the ability to
generate awareness for them.
Naturally, that’s not how reality works,
but it might be useful, seen as one of the
extremes of a continuum. The other end of
the spectrum is creating a market for things
people don’t actually want.
The latter sounds like something that’s
probably not good and the current state
of affairs is somewhere between the two.
It would seem that if you can admit the
way that things currently work isn’t evil,
the case of targeted advertisement is
increasingly less so.
The problem, of course, is that the
function isn’t entirely continuous. Targeting
can potentially be used to trick people. It’s
not so much that tricking people is novel in
advertising, but as you learn more about
how a person ticks, your trickery could be
that much more potent.
Very few ads are intended to deceive. Most
mass-media ads are designed to appeal
to people’s subconscious desires—to
be attractive, secure, etc.—and to link
a product to that desire. Online ads
will dominate advertising only if they
are effective at making that linkage.
Personalized ads ought to be effective at
selecting audiences for their subconscious
desires by analyzing their conscious
choices. See the BBC documentary “The
Century of the Self” (available on Google
video), especially segment three on the
rise of lifestyle marketing, for an example
of using conscious answers to infer
If there is a continuum, it may be from
informational ads with conscious appeal, to
influential ads with subconscious appeal.
Personalized targeting ought to improve the
effectiveness of both kinds.
Note that we may still be squeamish
about improving “influential” advertising.
It doesn’t make subconscious desires
conscious; rather, it adds a subconscious
link to a product—and thereby makes us
willing to buy more of it and spend more on
it than if we had not seen the ad.
Ken Novak —
Ramana Rao is the Ceo of iCurrent inc. Greg Linden is
the founder of geeky Ventures.