The Riddle

Adweek’s front door in Manhattan’s East Village coincidentally opens on Wanamaker Place, named after John Wanamaker, the 19th century retailer, who said the most famous thing ever said about advertising. Since taking up my job at Adweek, almost everyone who I have consulted about the state of the business has found an opportunity to remind me of Wanamaker’s shibboleth and cliché, often more than once. His conundrum seems to inspire both continuing awe about the unknowable magic of advertising and predictable consternation about its inherent waste. Wanamaker’s formulation has also become, more recently, a rallying cry for those who believe that digital marketing strategies, together with the vast trove of analytics such strategies provide, have solved the fundamental riddle of the business. In the new world Wanamaker can have the 50 percent of his ads that work and cleanly eliminate the half that don’t. “No reasonable business, I don’t care how successful, would ever put up with 50 percent waste,” yet another new media type was pained to tell me just yesterday, taking righteous umbrage in Wanamaker’s name. And yet, such businesses—that is, most major consumer products companies as well as innumerable newer service enterprises—will commit during this upfront week more than $18 billion to television, that most wasteful medium. They will do this despite the fact that, in the digital sphere, advertising’s effectiveness can be measured evermore precisely and as well fine-tuned in real time. Indeed, it has become a stumper of the business, almost on the level of Wanamaker’s own, that finely measured, 100 percent-performing advertising is, compared to the wasteful stuff, much less valuable—anyway people pay much less for it than they do the profligate kind. This is, many people analyze, just a market anomaly. Not only are digital analytic tools far superior, but the audience has shifted online, so, obviously, the market will account for this and television, and its reliable upfront rituals, will surely be left behind. Of course, logically minded people have been saying this for 10 years without there being a meaningful effect on the television advertising market. Actually, a counter-logic has prevailed: television audiences get smaller; prices get higher. One theory about the continuing strength of television advertising is that, on TV, the people paying for the ads actually see them, as do their friends and families. The client himself has his own barometer of his ad’s effectiveness and value. Not to mention that being noticed makes him feel good about himself and how he’s spending his money. Online, of course, with so much targeting, it’s quite likely that you and yours will never see the ad you’re paying for. Interactive people express terrible hurt here: they make the valid point that they are not really even making ads. They don’t do “story.” Theirs is a back-end operation, facilitating transactions, building sale- and brand-enhancing functionality, imagining and implementing the digital handshake between seller and consumer—the more transparent the better. Hence, then, they probably should not have called what they’re doing advertising since the most elemental point about advertising is to be noticed. Anyway, here we are: 15 years into our ability to measure the absolute effectiveness of the way and the methods by which we sell something, and, still, TV advertising, which measures nothing, guarantees no sales, offers no data, registers no interest, quantifies no desire, provides no follow-up, and which no sentient being watches anyway, is making more money than ever before. Waste works.

Convergent TV

The Riddle

Michael Wolff

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Michael Wolff