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The Decline of Google's (and Everybody's) Ad Business

timothy posted about 2 years ago | from the demoralizing-and-relentless-are-only-two-of-the-words dept.

Advertising 313

Hugh Pickens writes "Rebecca Greenfield writes that during their recent earnings call, Google reported a 16 percent decline in Cost-per-Click (CPC), meaning the value of each advertisement clicked has gone down. This follows a 12 percent drop last quarter and 8 percent the quarter before that showing an unfortunate reality of online advertising — unlike the print world, internet ads lose value over time. The daily and stubborn reality for everybody building businesses on the strength of Web advertising is that the value of digital ads decreases every quarter, a consequence of their simultaneous ineffectiveness and efficiency, writes Michael Wolff. 'The nature of people's behavior on the Web and of how they interact with advertising, as well as the character of those ads themselves and their inability to command attention, has meant a marked decline in advertising's impact.' This isn't just Google's problem. Overall, Internet advertising has decreased in value over the years as online advertising continues its race to the bottom. 'I don't know anyone in the ad-supported Web business who isn't engaged in a relentless, demoralizing, no-exit operation to realign costs with falling per-user revenues,' adds Wolff, 'or who isn't manically inflating traffic to compensate for ever-lower per-user value.' For Google's overall business, this loss doesn't mean as much, since it has since expanded its business beyond AdWords — including its recent acquisition of Motorola. For companies that didn't just buy big hardware companies however, it's a scarier proposition. Like Facebook, for example."

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Thank god (2)

ravenswood1000 (543817) | about 2 years ago | (#40750919)

The ads were getting a bit overwhelming. Maybe this will mean less of them.

Re:Thank god (3, Insightful)

Anonymous Coward | about 2 years ago | (#40750985)

No. According to the summary (and common sense), you'd see that their response is going to be more ads, to compensate for their less effective nature.

Re:Thank god (1)

0123456 (636235) | about 2 years ago | (#40751317)

The summary is talking about cost per click. Putting up more ads is unlikely to encourage more people to click on them, since very few people ever click on any ad.

Re:Thank god (2, Insightful)

Cute Fuzzy Bunny (2234232) | about 2 years ago | (#40751665)

"Yes, we're going to do the same thing, only moreso"

"Insanity is defined as doing the same thing and expecting a different result"

"We lose money on every sale, but we make it up on volume"

Any others?

So far, for all of my life, at least as well as I can remember...I've never been made aware of a product due to an ad, never decided to buy something due to an ad, and never decided to buy or get behind some other product/service/person as a result of an ad. Of course, this may be because I used to make ads and I know that most of them are full of semi truths and information not meant to be combined cobbled together with the intent of making me think something other than what I currently think, to someone elses benefit.

Meh, no thanks.

Re:Thank god (2)

geoffrobinson (109879) | about 2 years ago | (#40751789)

And then the Doritos Locos Taco was introduced...and it was if the world had changed.

Re:Thank god (3, Interesting)

rtaylor (70602) | about 2 years ago | (#40751013)

Quite the opposite.

If each ad display has less value, maintaining revenue means being more agressive with advertisments.

Myspace tried that (5, Interesting)

Animats (122034) | about 2 years ago | (#40751263)

If each ad display has less value, maintaining revenue means being more agressive with advertisements.

Myspace tried that. That didn't end well. It didn't work out well for Yahoo, either.

Facebook is trying it now. That may not end well. One clear implication - Facebook stock is hugely overpriced. Based on current revenue, Facebook is worth about $7 per share. The stock price assumes a huge growth in revenue. Probably not going to happen. Even a slow decline in Facebook's revenue means the glory days are over.

Ads on search results are worth far more than ads on other media. Ads on search results are presented when someone is actively looking for something in the relevant category. Ads on content are irrelevant interruptions.

Re:Myspace tried that (2, Insightful)

Sir_Sri (199544) | about 2 years ago | (#40751599)

Facebook stock is hugely overpriced. Based on current revenue, Facebook is worth about $7 per share. The stock price assumes a huge growth in revenue

Unless you're a real pro financial analyst you can't claim it is overpriced and then immediately point out that it's priced assuming a huge growth model. Just because ads look like they're going to do poorly doesn't mean Facebook can't still see a huge growth in revenue, they have a huge segment of the world economy that has facebook but mostly sketchy shitty ads, they have the option to bundle up your data and sell that, and the more users they have and the more information they have the more they can bundle up and sell that info for. Not to mention some very valuable infrastructure they could sell in some way shape or form to other companies which could be extremely lucrative (think Amazon's cloud). Or some other business plan that may not seem central to Facebook but might have some serious value.

Ads on content have always been 'irrelevant interruptions', but they're also much harder to quantify in value. People aren't going to buy a car because of a magazine or facebook ad, or even likely click on a car ad on facebook. But GM advertising on facebook at least shows they're still in business (which, for a while there, was important to tell people). TV ads were always about trying to convince people they wanted to buy your product, and hammer away at that point with repetition, while at the same time generally keeping people aware of the brand. Ads on searches are, on an individual basis going to have the potential to be much easier to quantify, because you can track clicks and sales per click and you can monitor user behaviour after they clicked on an ad and that sort of thing.

Re:Myspace tried that (1)

Anonymous Coward | about 2 years ago | (#40751843)

Unless you're a real pro financial analyst you can't ...

I stopped reading there. What magic do "real pro financial analysts" have which slashdotters do not have?

Re:Thank god (3, Insightful)

jellomizer (103300) | about 2 years ago | (#40751483)

The problem is the quality of the adds.

Internet adds will be far more useful if we could somehow trust the content in them. If Companies like Google, did the extra work to verify the authenticity of the companies and was willing to put its own brand reputation behind the quality of the people placing the adds, I think the value of the adds will go right up. Because right now there isn't any good way to tell the difference from a stable start-up/small company with a snake oil sales man.

Re:Thank god (1)

Skal Tura (595728) | about 2 years ago | (#40751607)

they are doing that. Quite stupidly tho. They are banning advertisements with common terms, such as BitTorrent which albeit being a trademark is also name of a common protocol. That's the term i best remember, but there was others, that's when i stopped AdWords completely.
In any case, adwords was worthless and over priced for us, didn't lead to enough sales to justify the cost (something like 100€+ per sale cost), one of the least effective advertising we have done. The very same ads, well same content, did elsewhere at best ~4.8€ cost per sale!
We tried probably 150 different ads.

Especially bad was advertising on other sites/"content partners" or whatever it was called, we spent a lot of money on that for exactly 0 sales.
Ads on google search atleast yielded some sales.

Also the management interface was a bit worse nowadays, some things wasn't as easy to do anymore. It used to be a lot simpler and easier.
Same problem has happened with google analytics, the new interface overcomplicates things (we have dozens of sites being monitored).

Re:Thank god (0)

Anonymous Coward | about 2 years ago | (#40751671)

There are websites out there that you can go to and find out the information you are asking for, but there is no good way for an ad company to do what you are suggesting without going bankrupt.

Re:Thank god (3, Funny)

Dog-Cow (21281) | about 2 years ago | (#40751825)

The quality of the subtracts aren't all that great either.

nobody ain't got no money anymore (3, Funny)

Thud457 (234763) | about 2 years ago | (#40750927)

The 1% don't eat nowhere near as much Doritos as the 99%.
Yay! They've finally clogged the pump of consumerism!

Re:nobody ain't got no money anymore (1)

fuzzyfuzzyfungus (1223518) | about 2 years ago | (#40751163)

It isn't so much 'clogged' as 'sucking air'...

Re:nobody ain't got no money anymore (0)

Anonymous Coward | about 2 years ago | (#40751385)

I'd more state, "run it dry". The pump is impeller based -- run it dry and the motor burns out.

Re:nobody ain't got no money anymore (4, Interesting)

slashmydots (2189826) | about 2 years ago | (#40751391)

You're saying they ran out of customers? Ummm I don't think so. Here, let me suggest a market research project for you. Go up to anyone you know and ask them when the last time was that they clicked on a web ad. I've never had anyone say they had ever. I think 90-100% of ad clicks are fake and internet advertising is a scam. Stupid companies that don't track ROIs don't realize that it's a complete waste of money or they assign some made up number like "value gained from visitors that at least came to the website via the ad" without realizing they're clickbots. I think the entirety of the decline is companies realizing they're wasting money and it's not a 1.0+ ROI.

Re:nobody ain't got no money anymore (3, Interesting)

kaiser423 (828989) | about 2 years ago | (#40751641)

I click Google ads on their search engine site all the time. Of course, I'm always searching for technology to meet some new requirements, or fed up with a vendor and looking for a new one and the Google ads are consistently very relevant for that.

Now, while doing personal searches or ads on a general webpage? Largely useless.

I'll continue to use adblock (0, Interesting)

Anonymous Coward | about 2 years ago | (#40750979)

And put these companies out of business (starting with Geeknet). Change is always good for an economy. It hurts the individual, but brings new opportunities to the whole.

So sick of being surrounded by people more fortunate than me. Everyone has some sort of large sum of cash or access to a large sum of cash through family. I have none of that. One fucking guy the other day actually less fortunate than me. Holding a sign at the intersection begging for money. I stopped and ate lunch with him. He had been out of work for several months. He appeared to lack an average level of intelligence, and that is likely the cause of his all his issues.

Re:I'll continue to use adblock (1)

Daddy-Oh (306170) | about 2 years ago | (#40751081)

What in the world was the point of all that, and what did it have to do with online ads?!

If you are annoyed at online ads, you are obviously fortunate enough to have internet access. I don't like all the ads in my face either, but there is no free lunch my friend.

If I only had a penny for every time that someone whined about why they can't get everything for free...

Re:I'll continue to use adblock (0)

Anonymous Coward | about 2 years ago | (#40751523)

There is no free lunch? Did you read the post you were responding to?

BEHOLD! (5, Insightful)

Moheeheeko (1682914) | about 2 years ago | (#40750983)

Adblock: Savior of the Internet.

Re:BEHOLD! (4, Insightful)

Sarten-X (1102295) | about 2 years ago | (#40751101)

Adblock: Tragedy of the Commons.

Re:BEHOLD! (5, Interesting)

Black Parrot (19622) | about 2 years ago | (#40751211)

Adblock: Tragedy of the Commons.

It's amusing to see the commercialized internet compared to "the commons".

Re:BEHOLD! (4, Insightful)

Sarten-X (1102295) | about 2 years ago | (#40751713)

And why is that amusing? A content-filled and freely-accessible Internet is a resource that the whole community benefits from, and yet Adblock drives up the real cost of having that content and accessibility. Sure, there would be some content without ads, but it'd be limited to corporate-sponsored subconscious marketing endeavors, personal philanthropy, and whatever society can produce in its spare time after paying the bills.

Re:BEHOLD! (1)

Dog-Cow (21281) | about 2 years ago | (#40751871)

The Internet, in the form you and I are using, has always been commercialized. I remember when the Internet Yellow Pages really did have most of the best sites on the 'net. Those days are gone and not coming back.

Re:BEHOLD! (1)

dizzy8578 (106660) | about 2 years ago | (#40751157)

I unblock a few sites I love but even there I will ignore the ads.
  Even if I receive a targeted ad via email or banner, I will go out of my way to buy it from somewhere else.
I always mistrusted marketers, but after spending 7 years supporting them as a tech, I now actively hate them all and hope more people figure out ways to make them suffer from their own lies, half-truths and misdirection.

Re:BEHOLD! (2)

datavirtue (1104259) | about 2 years ago | (#40751233)

People get REALLY good at ignoring ads. I can click "Ignore this ad" or "Skip this ad" and never have the slightest clue what it was about. I guarantee that people have trained themselves to tune out FB ads and don't even realize they are there anymore. I make money from ads and have not seen a decline.

Re:BEHOLD! (3, Interesting)

cpu6502 (1960974) | about 2 years ago | (#40751571)

I don't have Adblock on my computer. I have adblock in my head, and mentally don't see them (unless it's some girl with naked breasts). Ads on radio and television are more effective than web, since I can't skip those and am forced to listen.

I've noticed some websites are adopting the TV/radio model but forcing you to watch a 15 second ad before reaching the actual website. My concern is that websites might start charging money to view them (see Hulu and the shows they hide behind a $7 paywall). I'd rather have free ad-based internet than a pay-to-view internet.

Re:BEHOLD! (1)

Sir_Sri (199544) | about 2 years ago | (#40751695)

The thing with facebook ads is that for a long time, around here at least, all of their ads were super sketchy, so you wouldn't want to click on them anyway. But times change and facebook is a big serious publicly traded company now with boring companies advertising there. I still might not click on a Car ad on facebook (or a Coke ad) because why would you ever need to click on those ads? I'm not going to buy a car because I saw it advertised on facebook. But those ads serve to maintain a brand image and presence, it's much more about making sure people know when they shop your product exists and they can look at it than it is about directly selling you points to use on a shitty facebook game.

Sure, the points on a shitty facebook game are much easier to track ad clicks to revenue - but that was always doomed to have low value.

Re:BEHOLD! (2)

SQLGuru (980662) | about 2 years ago | (#40751315)

Adblock is great until all of the sites you enjoy for free all go under because their ad revenue couldn't sustain the site. I don't use Adblock.....I just don't visit sites who are too aggressive with ads (i.e. pop-ups) or consistently have ads that I disagree with.

Re:BEHOLD! (4, Insightful)

0123456 (636235) | about 2 years ago | (#40751453)

There were plenty of free sites on the Internet in the 90s when few people ran ads. Many of the were better than modern sites because they didn't have the desperate need to bring in more users to make more money from those ads.

And that was when a hosting account cost far more for far less than you get for the same price today. Of course every page didn't include a megabyte of Javascript crap to 'Web 2.0'-ise it.

Re:BEHOLD! (1)

CanHasDIY (1672858) | about 2 years ago | (#40751727)

Have to agree with this; I just set up a website for my in-laws business via domain.com (always use coupon code HAK5 - 15% off! Thanks, Darren!), and the total cost for the year is less than $100. Granted, it's fairly basic, but for that price I get unlimited space, bandwidth, subdomains, shit-tons of emails, some handy built-ins like Drupal and PHPbb...

Maybe it's because I'm fairly new to Web 2.0, but I just don't understand what's so expensive about running a website...

Re:BEHOLD! (1)

fluffythedestroyer (2586259) | about 2 years ago | (#40751645)

no ads nothing is free ? Change your ways, it's flawed. A company or a website that only relies on ads will fall for sure... every company boss knows that. Ads are there to spread the word or have a specific goal in mind. It's not the major money making machine ...if it is, somethings wrong.

Re:BEHOLD! (4, Funny)

daem0n1x (748565) | about 2 years ago | (#40751653)

Adblock is great until all of the sites you enjoy for free all go under because their ad revenue couldn't sustain the site. I don't use Adblock.....I just don't visit sites who are too aggressive with ads (i.e. pop-ups) or consistently have ads that I disagree with.

I fucking hate advertisement, and I don't have money to buy what the advertisements advertise, anyway, so even if I loved it, it wouldn't make any difference. I find advertisement profoundly annoying. So I use Adblock.

As a devote believer in the free market, I'm only concerned about my own selfish interest of not seeing any ads when I surf the Web. And if everybody is as selfish as me, everything will be fine. Oh, wait...

So, you're saying a free market is not the ultimate and final solution for something? Oh, why, but why do you hate freedom? Why do you hate America?

Re:BEHOLD! (1)

0123456 (636235) | about 2 years ago | (#40751739)

So, you're saying a free market is not the ultimate and final solution for something?
Oh, why, but why do you hate freedom? Why do you hate America?

Sites that people won't willingly pay for, be it directly or by clicking on ads, will go bust. Since people don't care enough about those sites to pay for them, no-one will really miss them.

Re:BEHOLD! (1)

Anonymous Coward | about 2 years ago | (#40751855)

OR, like myself, there will be a number of websites that exist because the person making said website *gasp* enjoys making said website.

I know, what the hell! Someone doing something because they ENJOY it, not because there's a paycheque in it? What's the world coming to?

That said, there's zero advertisements on my site (a webcomic for what it's worth), because I hate ads and refuse to subject my fans to them. How is this paid for? Outta my own pocket.

I know, I know... not only is there NOT a paycheque in it for me, I'm actually PAYING to do this. Crazy, backwards world we live in, where people wear hats on their feet and hamburgers eat people.

So as much as I'm sure you enjoy contemplating the utter destruction of the internet from ad blocking, there ARE still people out there that will have websites.

And rumour has it that some websites actually SELL things, instead of relying solely on advertisements to exist. Bizarre scenario, that one... I can barely fathom a situation in which that could be possible.

Niiiiiiiiice!!! (1)

rodrigoandrade (713371) | about 2 years ago | (#40751001)

I hate ads!!!!

At least now the talented engineers at Google et al. will use their bright minds to actually create the next great innovation, instead of creating the next obnoxious ad that circumvents AdBlock, the next stupid ad-ridden Skinner... er, social game, etc.

Re:Niiiiiiiiice!!! (2)

jellomizer (103300) | about 2 years ago | (#40751555)

And how is Google going to make money to pay for those next great innovations?

Re:Niiiiiiiiice!!! (1)

daem0n1x (748565) | about 2 years ago | (#40751705)

And how is Google going to make money to pay for those next great innovations?

Really not our concern, is it? Don't you believe in free initiative?

You mean Facebook might crash, burn, and die? (1)

Chas (5144) | about 2 years ago | (#40751027)

We could only be so lucky.
If it could take Twitter with it to the grave, so much the better!

Re:You mean Facebook might crash, burn, and die? (3, Insightful)

fuzzyfuzzyfungus (1223518) | about 2 years ago | (#40751221)

You should be so lucky... If Facebook stops having luck with the ad sales, they can just set up a new HQ somewhere in Langley and provide bespoke social-mapping solutions to a shadowy array of government and corporate customers(assuming that they don't already).

Re:You mean Facebook might crash, burn, and die? (1)

fluffythedestroyer (2586259) | about 2 years ago | (#40751667)

does that mean people will talk to each other... hell no. where is the world going now ?

Good (5, Insightful)

Hatta (162192) | about 2 years ago | (#40751041)

The internet had plenty of good content before it was ad supported, and it will have plenty of good content afterwards. Come to think of it, the content was actually better before it was add supported.

Re:Good (0)

Anonymous Coward | about 2 years ago | (#40751195)

EXAMPLES please?
Also what do you suppose the content creators live from?
Are you going to pay for content instead?

Re:Good (2)

Hatta (162192) | about 2 years ago | (#40751379)

I'm afraid I don't have quotes from USENET in 1992 at hand. I propose the content creators make a living doing what they are experts at. People who are good at things like talking about those things. That's better content than almost anything you'll find on the web today.

Even today, the best content you'll find is buried on niche web fora. That's where you find people who are passionate talking about their passion. Ad supported, but not because the content creators get paid. Ads are just there to pay for the hosting, which we all used to pay for as part of our ISP bill when USENET was around.

All ad supported content could disappear tomorrow and we'd be none the worse for it. We'd have to find a replacement for ad supported hosting, but it's been done before and we could do it again.

Re:Good (2)

0123456 (636235) | about 2 years ago | (#40751505)

Even today, the best content you'll find is buried on niche web fora.

Most of the experts I know have given up on the web and gone back to email lists; a few dozen messages per day with high signal to noise ratio are much easier to handle than a web forum and the use of email and difficulty of finding the lists keeps out the riff-raff.

Re:Good (0)

Anonymous Coward | about 2 years ago | (#40751629)

I pay $10/month for web hosting. It provides me with enough bandwidth and storage space to serve up far more content than I'm capable of generating (and this is bargain basement hosting). I don't feel the need to monetize it because, frankly, I get far more than $10 worth of enjoyment out of it every month. It's enough to know that I'm contributing something. I'm not saying every site on the internet could replicate this model, but the OP is right. To think that people won't create and share without financial a incentive is what the ad men want you to think. Fortunately, it's just not true.

Re:Good (1)

fluffythedestroyer (2586259) | about 2 years ago | (#40751693)

yahoo comes to mind lol. it was great before they changed they're model to a more business like. When they did, they went down, crash and burned. I used Yahoo too and when they got more business like design and model, I used another one which was more appropriate to my taste.

Re:Good (1, Informative)

rgbrenner (317308) | about 2 years ago | (#40751253)

http://en.wikipedia.org/wiki/Web_banner [wikipedia.org]

The pioneer of online advertising was Prodigy, a company owned by IBM and Sears at the time. Prodigy used online advertising first to promote Sears products in the 1980s, and then other advertisers, including AOL, one of Prodigy's direct competitors.

So when you say "the content was actually better before it was add [sic] supported," you're talking about the 1970's?

Yes.. lots of very interesting content on the internet in the 70's. Much better than today [/sarcasm]

Re:Good (1)

Anonymous Coward | about 2 years ago | (#40751337)

Advertising brought us "web 2.0" and "the cloud," which so very away from the initial dream of open connectivity and open sharing. To put it another way, advertising brought an unmitigated disaster for liberty and privacy. The decline of advertising is a big opportunity!

Re:Good (1)

oakgrove (845019) | about 2 years ago | (#40751427)

Is the "good content" that existed before ads actually gone though? I realize that content evolves over time but I would presume that the ad supported stuff is additive rather than a replacement for what is/was already there. I'm curious though, how would something like Google search be supported if not through ads? Micro-payments? Subscription?

Re:Good (1)

jason777 (557591) | about 2 years ago | (#40751689)

It had plenty of good content. But where was it hosted? If it was a university personal page, school, part of your ISP account, etc, then it didnt really cost anything to host. Heck, I used to post all kinds of free content such as how I got my linux box working as a router, step by step help, electronics projects, etc. I enjoyed creating content if others would benefit from it. But back in the day, there were fewer people on the internet. Now, you almost need an ad or two to run the hosting if you have any kind of traffic at all. I mean, how else are we to put servers up? Don't get me wrong though, I'm all for providing free information, but not if I have to pay for bandwidth.

Re:Good (1)

0123456 (636235) | about 2 years ago | (#40751831)

My web sites cost a total of $6 a month, if I remember correctly; certainly it's $10 a month. Technically they come with 'unlimited bandwidth', but practically they would slow to a crawl with too many users.

Back in the early 90s, I was paying $25 a month and the server shared bandwidth over a 56k modem. A couple of years later they upgraded to a direct link comparable to a slow home DSL line today.

So long as you're not hosting video or other big files or bloating every web page with megabytes of Javascript, hosting costs are much lower today than they were back then.

It's simple supply and demand (1)

Hentes (2461350) | about 2 years ago | (#40751063)

The money in internet advertising grows slower than the number of internet ads, making them cheaper.

Use larger ads (2)

DNS-and-BIND (461968) | about 2 years ago | (#40751085)

Google's unobtrusive text ads are out. Solution: really big ads that get in your face before you can get to the content [evanmarckatz.com] . These sorts of ads have become much more popular recently and I can only conclude it's because they work.

Also growing in popularity is "answer this marketing survey before you get more than one paragraph of the content". It's only one question now, but as it grows in popularity there will be more questions. Ultimately you'll have to fill out an entire multi-page survey before being allowed to access content. This will be linked to your real name and Facebook account, of course.

Re:Use larger ads (1)

0123456 (636235) | about 2 years ago | (#40751243)

Google's unobtrusive text ads are out. Solution: really big ads that get in your face before you can get to the content [evanmarckatz.com] . These sorts of ads have become much more popular recently and I can only conclude it's because they work.

I would conclude it's because they're desperate. When ads fail, advertisers don't give up and find a real job, they make them bigger and more obnoxious.

No-one wants to be plagued with ads when they're looking for information. I think I've intentionally clicked on about three ads in the entire time I've been using the Internet.

Re:Use larger ads (0)

Anonymous Coward | about 2 years ago | (#40751375)

My personal favorite advert style was the "roll over to activate" sidebar.

No clicking or actual interaction required, if your mouse grazed over the top of the bar (perhaps on route to the scroll bar or back to your primary monitor) it launched whatever screen-raping advert it liked.

That was several years ago, before I figured out adblock and noscript ... I wonder if those terrible things are still around.

Re:Use larger ads (1)

Shikaku (1129753) | about 2 years ago | (#40751459)

Yes they are.

gloves and suspenders (1)

epine (68316) | about 2 years ago | (#40751669)

These sorts of ads have become much more popular recently and I can only conclude it's because they work.

There's a scene in Schindler's List where Amon Goeth sizes up Schindler's strange request remarking, "Whatever you do, there's always money in it, but this one I can't figure out." For some reason, I didn't spot this one in the usual movie quote compilations. Probably because the point is sharp but the language is dull.

I wouldn't jump to conclusions too quickly. Fortunately for his Jews, Schindler was able to mutter in his getaway car "there are more motives in heaven and earth, Amon, than are dreamt of in your philosophy".

Ultimately the problem here is that advertising tends not to be such a huge value add, unless you value the convenience of shopping at Margins-R-Us a whole lot.

Step 1: Identify the desired product.
Step 2: Find a vendor with "flow through" pricing.
Step 2a: s/Trademark\$*/generic_name

Just an hour ago I was looking for cut resistant gloves to handle glass carboys: s/Kevlar/aramid/ Bingo! On the plus side, a partially severed tendon would cut down no my posting obsession, with a coefficient of about 20wpm/mm. I'm also going to wrap the bottles in bundling tape to coral shards. I'm a gloves and suspenders type of guy.

Re:Use larger ads (1)

daem0n1x (748565) | about 2 years ago | (#40751861)

Google's unobtrusive text ads are out. Solution: really big ads that get in your face before you can get to the content [evanmarckatz.com] . These sorts of ads have become much more popular recently and I can only conclude it's because they work.

Also growing in popularity is "answer this marketing survey before you get more than one paragraph of the content". It's only one question now, but as it grows in popularity there will be more questions. Ultimately you'll have to fill out an entire multi-page survey before being allowed to access content. This will be linked to your real name and Facebook account, of course.

Yes, because annoying the fuck out of your users can't possibly go wrong...

I continue to wonder... (5, Insightful)

Covalent (1001277) | about 2 years ago | (#40751089)

...who clicks on ads? The only time I click them is by mistake and then in frustration I close the new window, usually before it loads. My value per click is $0.

Re:I continue to wonder... (1)

datavirtue (1104259) | about 2 years ago | (#40751285)

Some companies are wholly supported by this accidental clicking. They make good bank too, sometimes tens of thousands per month. Its not hard if don't mind being an ad spamming douche that adds no value to the internet.

Re:I continue to wonder... (1)

datavirtue (1104259) | about 2 years ago | (#40751307)

I like making money from ads but the thought of spamming, and deceiving people turns my stomach.

Re:I continue to wonder... (0)

Anonymous Coward | about 2 years ago | (#40751659)

The people who click on ads are the same people who are subsidizing your free experience on this website, and on others. Without people clicking on ads, you would be out of a job. Regardless of what you do, revenue generation is tied to sale of a product or service of some kind, and sales are dependent heavily on marketing and advertising. Unless ofcource.. you live in some socialist hellhole.. then god save you my friend..

Good (1)

Ryanrule (1657199) | about 2 years ago | (#40751117)

Fuck them all. Slime of the earth, people that sell and run this stuff.

Re:Good (0)

Anonymous Coward | about 2 years ago | (#40751183)

Like Slashdot?

Re:Good (1)

datavirtue (1104259) | about 2 years ago | (#40751335)

Slashdot ad hosting is done right. There are hardly any ads and they are usually relevant.

Capitalism at work? (1)

oakgrove (845019) | about 2 years ago | (#40751127)

I realize we've all been lulled into believing that inflation is somehow inevitable but in a correctly functioning capitalist society, prices for just about everything should actually go down as production becomes ever more efficient.

Re:Capitalism at work? (1)

SuricouRaven (1897204) | about 2 years ago | (#40751259)

But if prices went down for everything, that means the cost of living would also go down, which means that employees would be willing to work for less, so wages would fall, so the real value of goods remains constant.

Markets are really very complex things - everything interconnects in intricate and not-always-obvious ways.

Re:Capitalism at work? (1)

MozeeToby (1163751) | about 2 years ago | (#40751541)

Don't forget, if the price of everything will be cheaper tomorrow than it is today, I'm better off to hold off buying anything until the last possible moment. Deflation harms the economy by slowing consumer spending. Granted, don't see many people in the US capable of thinking that long term, but that is the prevailing theory.

Re:Capitalism at work? (1)

cpu6502 (1960974) | about 2 years ago | (#40751725)

>>>But if prices went down for everything, that means the cost of living would also go down, which means that employees would be willing to work for less, so wages would fall, so the real value of goods remains constant.

It worked just fine in the U.S. 1800s when inflation was essentially zero. There's no reason we can't fix the money supply to ~3 trillion circulating dollars and have another century of zero inflation.

Re:Capitalism at work? (0)

Anonymous Coward | about 2 years ago | (#40751775)

As the cost goes down due to increasing technology, people want more technology, thus spending more money.

Ask your grandparents what regular things they paid for when they were 20. Here's the full list: Clothing, rent, food, doctor, dentist, books, stamps, tools (and related supplies), a radio, water (if they didn't have a well, many people did have one back then), gas/wood/coal, possibly electricity, perhaps a barber.

Think about the stuff *you* buy now and how much more you spend on it than the stuff above, and how much of the above you still buy.

Re:Capitalism at work? (1)

Black Parrot (19622) | about 2 years ago | (#40751269)

I realize we've all been lulled into believing that inflation is somehow inevitable but in a correctly functioning capitalist society, prices for just about everything should actually go down as production becomes ever more efficient.

Internet ads: infinite supply, zero demand. Small wonder they aren't paying off.

Re:Capitalism at work? (0)

Anonymous Coward | about 2 years ago | (#40751345)

Deflationary currency encourages hoarding (that dollar will be worth more purchasing power if you spend it tomorrow than it is today), which discourages innovation. This will tend to result in a stagnant economy as there is no incentive to take a risk developing say: a more efficient manufacturing process.

Slow inflation, means that the excessively wealthy become less wealthy is they leave their money under a mattress. This encourages them to instead invest the money is something that will create value, thus growing the economy.

Rapid inflation, is unsustainable, because you can't save for the future (your money will devalue too quickly). This will result in the currency collapsing if not controlled.

Like most complex systems it's a balance.

Re:Capitalism at work? (1)

datavirtue (1104259) | about 2 years ago | (#40751531)

Right now we have banks sitting on cash (the Fed is paying them interest on reserves!), and they do not want to lend do to the issues you have cited. The House wants the Fed to act and Fed wants the House to act. The Fed's weapons are weak and the House IS weak. Add to this new taxes and regulation and We Have A Problem. Are they getting taxed on the income from the interest the Fed is paying the banks right now? IDK, does anyone else know anything more about this?

Re:Capitalism at work? (0)

Anonymous Coward | about 2 years ago | (#40751623)

Honestly, it would be better (although almost impossible) to have almost no inflation at all. That would make it easy for people to save for retirement. Whatever you earn now, will be generally worth as much forty years from now.

The problem is determining when value has been created and added to system and injecting additional money to stave off deflation. Even more difficult is how to pull money out of the system to combat inflation.

Hoarding wealth could be solved with taxation. Generally just put a large inheritance tax in place. If your kids want to be as rich as you were, they'll have to work for it or be as brilliant as you were.

Re:Capitalism at work? (1)

datavirtue (1104259) | about 2 years ago | (#40751347)

Prices can decline in the face of inflation. Inflation doesn't mean you are really paying more. You need to study economics.

Re:Capitalism at work? (0)

Anonymous Coward | about 2 years ago | (#40751557)

Fuck off, arrogant prick. I am well aware that prices fluctuate for a variety of reasons. In a well functioning economy prices do tend to go down as production efficiency increases. We see this in certain areas now like semi-conductors. Again, fuck off in case it wasn't clear the first time.

Oakgrove

I'm desensitized. (1)

samazon (2601193) | about 2 years ago | (#40751141)

They say video games and tv desensitize you to violence and sex? I've been so inundated with advertising that I don't even care anymore. I literally do not pay attention to anything that scrolls, flashes, or pops up. My attention can no longer be grabbed. If I want your ads (read: Newegg and Buddies Pro Shop) I'll sign up for an email newsletter. Otherwise, you can forget any ad making an impression on me.

Re:I'm desensitized. (1)

hattig (47930) | about 2 years ago | (#40751457)

That's exactly it. I don't see adverts any longer either. But I'll read some of the emails that I've opted in to (yeah, mostly tech shops, etc).

So one solution for the retailers is to create a better relationship with your existing customers to keep them coming back and recommending your company to other people. Stop throwing loads of money at trying to get new customers by increasingly less efficient online adverts, and try different means of promoting your company that will get people's attention.

I will admit to clicking on a few of the Google text adverts and paid-for search results when looking for kitchen white goods recently. Those ads give me more information in a line of text than any flash animated or video advert ever has.

Too much screaming. (1)

pubwvj (1045960) | about 2 years ago | (#40751159)

The advertisers scream and rant and rave. Pretty soon we filter them out both with automatic filtering done at the software level and and mental filtering done at the wetware level.

If I want something I go looking for it. Advertising doesn't make me buy. Thus advertising is a waste of money. It just jacks up the costs. In tight markets that extra cost makes or breaks.

Re:Too much screaming. (2)

Attila Dimedici (1036002) | about 2 years ago | (#40751393)

I know someone who is heavily involved in business management (involved in management consultant at the Vice President and above level of companies like Nissan USA, IBM, GMAC, etc) who has repeatedly said that good advertising/marketing is providing information to your potential customers. He would argue that the only time a business really wants to advertise/market to someone is when they are looking for something that business sells.
Really the problem with advertising has become that businesses no longer see it as informing potential customers about the products they sell, but instead see it as some sort of magical incantation to get people to buy their product even when it isn't something those people actually want. The more often a businesses advertising causes a person to buy something they do not actually want, the less effective advertising becomes going forward. If businesses would focus on convincing the people who actually want their product that they want their product they would find advertising effectiveness to go up significantly.

Re:Too much screaming. (1)

edremy (36408) | about 2 years ago | (#40751465)

You think that, but you're not correct. An awful lot of advertising has nothing to do with selling X to you right now. It's to let you know that X is available, and from company Y. In a year or two you might find a case where you need X, and your subconscious will remember that you can get it from Y. Most people only consider 2-3 options when buying something, so getting on that list is critical.

Re:Too much screaming. (1)

0123456 (636235) | about 2 years ago | (#40751537)

Well, that's what advertisers tell you when they're trying to convince you to buy ads with no objective evidence that they work.

business rule (1)

slashmydots (2189826) | about 2 years ago | (#40751217)

There's a rule in business. If you make money off of primarily 1 main product and everyone universally hates your product, you're eventually going to go bankrupt. Welcome to advertising!

Please correct the link (1)

Hugh Pickens writes (1984118) | about 2 years ago | (#40751235)

Could you please correct the submitter's link.

It should be:

http://honorponcacity.com/ [honorponcacity.com]

The link is correct in my original submission.

Best Regards,

Hugh Pickens

Wait, Motorola Mobility will save Google? (2)

Bill, Shooter of Bul (629286) | about 2 years ago | (#40751237)

The company that has been hemmoraging money since 2004 will save Google from declining ad revenues?

Re:Wait, Motorola Mobility will save Google? (0)

Anonymous Coward | about 2 years ago | (#40751481)

Agree, that seemed to be an overly optimistic point in the summary. Google, like Facebook, is heavily dependent on digital ads. Motorola's revenues (hopefully) support the employees of Motorola, not the employees in Google's online businesses.

Alternative hypothesis (5, Interesting)

JDG1980 (2438906) | about 2 years ago | (#40751303)

This follows a 12 percent drop last quarter and 8 percent the quarter before that showing an unfortunate reality of online advertising â" unlike the print world, internet ads lose value over time.

Or, alternatively, print ads were never really all that successful, but unlike on the Web, there was never any way to measure their efficacy with much precision.

Re:Alternative hypothesis (2)

tthomas48 (180798) | about 2 years ago | (#40751477)

And in the same spirit. Companies really like seeing 30 second movies about themselves on TV regardless of return on investment. Internet Ads are nowhere near as fun as TV ads or magazine ads you can put in a frame.

Re:Alternative hypothesis (1)

kaiser423 (828989) | about 2 years ago | (#40751743)

+1

I've seen lots of people pay way more to get ads on TV at totally random times that probably reach none of their customers just so they can see their add on TV. It feels more real to them.

Really, Groupon is one of the new places/styles for internet ads. You have a new restaurant and need to get the word out? Put out a Groupon or facebook deal or similar and watch droves of people come in. It's really incredibly effective. One of my favorite local restaurants went from being a ghost town to at full capacity for two weeks straight due to a well-timed Groupon, which then trailed off quickly. But form that they now have a relatively steady clientele that keeps them in business. Best money they ever spent. Way better than ROI than the TV and radio ads they were buying before.

No (5, Informative)

Anonymous Coward | about 2 years ago | (#40751325)

I work in Google ads and the cost-per-click fretting miss the mark for lots of reasons.

- First we are talking year-over-year drop so the numbers are nowhere close to what the summary implies. In fact, they went up last quarter if I recall correctly.
- Second we believe lowering cost-per-click is a *good* thing as long as other metrics (such as revenue and clickthrough rate) stay neutral. It means advertisers are getting their clicks for less cost, which makes them happier, and more likely to dump more money in. This is exactly what has happened recently. It is not because advertisers are lowering bids - it is because of (intentional) changes on our end mostly.
- There is only one legitimate actual concern here: advertisers pay less for mobile ads, and mobile is becoming more and more important. But that has nothing to do with less interest in ads in general.

Re:No (0)

Anonymous Coward | about 2 years ago | (#40751547)

What?! How Dare You Question TFA!! TFA Knows All! Fool!

work at home (-1)

Anonymous Coward | about 2 years ago | (#40751355)

as Edward responded I didnt even know that a person able to earn $5472 in one month on the internet. did you read this web page http://www.makecash16.com

It's just the declining economy in Europe. (1)

DOsinga (134115) | about 2 years ago | (#40751357)

Look at this graph: http://www.rimmkaufman.com/content/Goog-Growth-Q1-2012.png [rimmkaufman.com] CPC go up and go down. But not like Wolff says, always going down. They went sharply down around 2008, then went up for a bit, now go down. I blame economic contraction in Europe which account for half of Google's traffic.

Yeah buying Motorola should really help..... (2)

Karlt1 (231423) | about 2 years ago | (#40751579)

"'I don't know anyone in the ad-supported Web business who isn't engaged in a relentless, demoralizing, no-exit operation to realign costs with falling per-user revenues,' â" including its recent acquisition of Motorola,"

Because being a commodity Android phone manufacturer definitely protects you from a relentless, demoralizing no-exit operations to realign costs with falling per-user revenues.....

http://www.asymco.com/2011/05/16/iphone-share-of-phone-market-in-q1/ [asymco.com]

Learning to "think" around them (2)

davidwr (791652) | about 2 years ago | (#40751621)

Time was, Internet ads were a novelty. I've since learned to "see past them," pretty much ignoring them.

It's to the point now that if your ad is so in your face that it gets my attention, I view it as intrusive and it has a NEGATIVE impact instead of the positive impact you wanted it to have.

I learned the same trick with newspaper, billboard, TV, and radio ads as a child. I expect most others did as well. This might explain why the effectiveness of those ads hasn't changed recently.

This comment sponsored by Commander Taco's Pink Ponies. Geeky Girls love Commander Taco's Pink Ponies.

I am having to learn this trick over again for electronic-billboard ads and product-placement ads, but once I do, things will be back to a "steady state" of non-changing (in-)effectiveness.

The only successfully ad company is Amazon (4, Interesting)

vlm (69642) | about 2 years ago | (#40751709)

The only successful targeted internet ad company that I know of is Amazon.

I've bought hundreds (thousands?) of dollars of stuff based on recommended items. I forget exactly how they phrase it but its something like "people who bought your Charlie Stross book "Rule 34" also bought the following books" and they list Accelerando and The Apocalypse Codex and so on. Ditto about a zillion other authors and non-book products.

I've never intentionally clicked on or purchased anything from any other targeted ad, and have been using ad blockers since weeks after that tech was invented.

The scary part is thinking about what really finely focused /. ads would push on us /.ers. Hmm. Instant Hot Grits, Debian install disks, buy this package at a discount: one cup now with pix of two girls, lots of rick astley / rickroll music...

I expect I'm an outlier, but... (0)

Anonymous Coward | about 2 years ago | (#40751773)

I've stopped using Google as much as possible these past 8 months or so. Not that I was a big clicker on their ads, but the whole place is giving me the creeps. From the data collection, to their politicization and activism, I'm just not interested in continuing to contribute to any of that and my paranoid self is wary of keeping myself in the crossfire of those aspects. So I use other venues for the services they offer as enticements. As a result, I don't even see much of Google's ads anymore.

Maybe I'm not alone?

Don't even get me started on Facebook.

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