Has Ad Tech Jumped the Shark? Hardly!

Since joining InkHouse five years ago I’ve had the tremendous opportunity to oversee many of our ad tech clients. The technology has - and continues to - evolve at a breakneck pace; there are a handful of dominant players and a host of underdogs that are changing all the time. The space allows for consideration of big issues like privacy, how the media is paid for, big data, the role of mobile and more.

A few months ago though I was having drinks with a client in New York. We’ve worked together for several years and through her time at multiple companies. We were musing over colleagues and reporters we’d worked with and wondered whether ad tech had lost some of its luster. Had most of the issues in ad tech been resolved? Were big things past and were companies just tidying around the edges? Had ad tech jumped the shark?

Looking at the softening funding market, dropping valuations, delayed IPOs, downsizing and endless rumors, this wasn’t a hard conclusion to arrive at. We both decided that it had indeed jumped the shark, that more exciting things were happening elsewhere. But since then I’ve had a change of heart. There are still a lot of big issues that publishers, advertisers and consumers need to wrestle with . Here are a few that I think are going to be important:

• The problem of publishers - they’re the lynchpin of the whole digital experience. Whether they’re app developers, independent news sites or behemoths like Google, Apple, Facebook, Twitter and Amazon, they face pressure. Sure, the pressure is different for each of them but issues like viewability and bot fraud are causing headaches. Advertisers want to pay less and consumers don’t want to pay at all; but in the end someone has to pay to keep the content flowing.

• The issue of ad blocking - this is one of the problems publishers face but it is a big one that is being overlooked by many. In some countries and among some publishers the ad block rates are at 50 percent - and rising. That means publishers are missing out on a huge chunk of ad revenue. It’s hard to keep the quality up and the lights on if half of your customers don’t want to pay for they use. If more people were cool paying for digital subscriptions maybe it wouldn’t be such a big deal, but that number is pretty low too - around 20 percent.

• Making mobile meaningful - everyone assumes dollars follow eyeballs. So far there’s a pretty big lag in that happening when it comes to mobile. Why? Because no one has cracked the mobile ad unit nut. Those itty-bitty banners on the bottom of apps or mobile browsers? Ummmm, yeah, they’re really captivating, aren’t they? How about sponsored posts on Facebook? I don’t know if you’ve ever clicked on one (on purpose) but I don’t think I ever have.

These are just three challenges but there are a ton more. When I look at the list and think of the conversations I’ve been having with clients, colleagues and reporters, I realize it’s premature to say ad tech is somehow past its prime. There are still a lot of business and tech challenges to be worked through and, consequently, many stories still to be told. It’s a great time to be involved in this space.

Photo by Travelbag, Ltd.