Q&A with Infolinks CEO Dave Zinman: ‘The Future of Display is User-Driven Ads’

Inplace #2

ADOTAS – Dave Zinman is an ad industry veteran who invented the ad server and now serves as CEO of the text-based advertising company Infolinks. Adotas recently sat down with Dave to talk about the future of advertising and ways that brands and publishers can combat the growing concern of banner blindness.

Q: Since you first invented the ad server, how is the display ad model broken from an anecdotal and technical perspective?

A: Ad-serving technology enabled the explosion in display by making it simple for any publisher to create standard ad slots and get them monetized through ad networks, exchanges and other intermediaries. For a long time, this was a good thing, but as the supply of ad space continued to increase unabated, it eventually created too much tonnage and irrelevant ads. US consumers now see an average of 50 online display ads per day. Consumers learned where ads are typically placed on the page and that those ads are usually not relevant to what they are doing at the moment. This caused banner blindness and the declining engagement rates we see today. Click through rates have declined from 2% in 1996 to less than .1% in 2013.

Q: What is the future of display and why is it broken?

A: Display is broken because we serve too many ads and most of them are irrelevant. This has caused banner blindness and resulted in rapidly declining engagement. The future of display is user-driven ads, which are only served when they are relevant. The development of native or in-stream ads is an encouraging attempt to address this.

Q: Isn’t the problem more about being annoying or invasive for consumers? Will being overly-aggressive in displaying ads make people hate ads even more?

A: Advertising can create a negative consumer experience if it is too aggressive or if it is irrelevant. Traditional TV advertising was interruptive. As a result when the DVR was introduced, consumers seeking a way out of the interstitial nature of 15- and 30- second spots quickly adopted the new technology. Most display advertising has not been that aggressive, but it has been highly irrelevant. A recent Infolinks survey found that only 2.8% of respondents recalled the last ad they saw online and also found it relevant. This is a miserable track record for a medium that prides itself on targeting.

Q: Are there alternative forms of advertising that you predict will replace banners?

A: Native advertising is a new trend, but it shows the most promise when it embodies two principles: (1) real-time relevance to the content being consumed, and (2) non-traditional placement to break the cycle of banner blindness. Too much of native only delivers non-traditional placement without the relevance, but this will change over time.

Q: Eye tracking helps brands see what consumers are looking at. Talk about the methodology and sample size in your latest research.

A: The approach utilizes webcams to track the exact position of the eyes and where on the page they are focused. This resembles a lab environment more than a broad survey of users, so sample size is always small with these kinds of studies. We asked each participant to review several web pages and recorded their eye movements. From this we were able to generate heatmaps showing where the eyes spent the most time, as well as vital metrics for each region of the page that was studied. These metrics included: % seen, time to (how long it took for the participant to see the particular region), and time on (how long the participant’s eyes were focused on a particular region of the page).

Q: Why did you seek out conducting this research?

A: Infolinks has been seeking to address the challenges of display since the company was founded. There have been many studies about banner blindness, but this is the first to measure its impact and identify solutions. The results point the way for the industry to address the declining engagement with display advertising.

Q: What are the next steps for advertisers to help improve digital media?

A: The takeaways from the study are pretty stark. Advertisers and publishers need to utilize ads that do two things: (1) break the box of standard placement and show ads in non-traditional locations. This breaks the cycle of banner blindness and gets the ads noticed instead of ignored, and (2) target ads to what people are interested in real time, not what they were doing the day, week or month before. By making ads more relevant to their current tasks, users will be more engaged with the ads, increasing time spent.

Q: What is the future of advertising, given your perspective on the issue of broken ad delivery?

A: In many ways, the trend towards native advertising addresses many of the challenges highlighted by the Infolinks Eyetracking Study. Native placements are non-traditional and break the cycle of banner blindness. In many cases, however, native ads are not targeted to real-time intent, however, and instead are utilizing retargeting to show people something they were interested in before. Once native advertising marries non-traditional placement with real-time intent, engagement rate declines will be firmly reversed.

The future of advertising will be user-driven. This is the way search advertising developed, where users could raise their hands to indicate interest at a very granular level and the advertising was designed to match that granularity. Display, native, mobile, social and video advertising can all apply the lessons of search to deliver advertising that speaks to the real-time interests of consumers in more compelling ways.