Life in a Transparent World

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DM CONFIDENTIAL – Every industry has its secrets, its tricks of the trade, those skills, places, or people of which some people have knowledge and others don’t. These trade secrets have played a particularly large role in the success of many in the performance marketing space.

Having a head start has made all the difference in the world. The simplest example comes from Google or Facebook. Those early to those platforms made immense amounts of money, and, in the case of Google, those who got in early ended up building moats around their listings for no other reason than account history.

Thinking about the performance marketing space, the potential areas for leverage that come to mind are: access to offers, payouts on the those offers, access to traffic and creatives/optimization. Within each, something seems to have changed or better said continues to change.

For the longest time we didn’t quite understand what it might be. At the heart of the matter was this nagging question, “Why do new verticals seem to have a continuously shorter shelf life?”

The easy answer would be competition, that there are more and more marketers today than before, but we just can’t see competition as the reason why ringtones would have longer staying power than acai. It’s as though each new hot trend has an ever-decreasing half-life. It pops and then more quickly than before finds a less than desirable stasis after being driven to the bottom.

The Ad World Is Flat

While competition plays a piece on the shorter half lives of campaigns, we can’t help but wonder if the answer has nothing to do with specific market dynamics and more to do with our transparent world. If we think back to the “early days,” information about offers, payouts, creatives and traffic didn’t exist. It took a relatively long time before word of someone’s success got out, and it took even longer before specifics of their success became more widely known — where they ran, what page they ran, the ads they ran and even what CPA they received.

Forums have typically discussed many of these pieces, but they have an overall limited reach. That is not the case with the tools that exist today including those that show what offers each network has and at what prices.

There is a new breed of tools out there hastening this transparent world, ones like AdBeat that can do for creatives what keywords do for contextual placements and banners what keyword tools have done for search. The insights provided are significant.

Search tools can shed some insights on keywords run, but ad tools share what ads have run and where they run. It means that someone wanting to do a campaign can build a great media-buying list right away. These tools will do more than just frequency, in the future they will have the ability to show iterations of ads so that a competitor can see not just what runs now but what a company has run. This type of historical view would imply a glimpse into their optimization process.

NYTimes op-ed writer Thomas Friedman has talked about a flat world. This might be the equivalent to the flat world in advertising. It is no longer about easy connectivity of where people are based but ease of connectivity when trying to gain insight to a market. All the pieces are visible.

In this new flat advertising world, we start to see what is running, where it is running, and what aspects of it are working. It’s a trend that will only continue, and its impact on the performance marketing world has already been significant.

Looking Long-Term

Like many things, the early impact might be negative. Now and in the near future, it probably continues to mean pressure on those running offers, that their “secrets” could be discovered faster and their lead taken away more quickly than before. That could accelerate the race to the bottom as people continue to try and squeeze out as much money as possible in the shortest time possible.

In the future, this flat ad world should have a very positive impact. As everyone starts to know everything and we start to operate with greater transparency, it should mean more overall innovation. It will mean more defensible businesses. People will start to scam less (not a bad thing) and build more (also not bad).

If people can’t do bad stuff and must do better stuff, we all win. The industry starts to get away from being a) just piggy banks to help others cover float and b) guardians of traffic trying to combat the bad. We might just get what many have wanted all long, greater separation between companies and more fun doing doing what we love.

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