Accountable Relationships

One of the most significant changes that the spread of “web culture” has imposed on advertising and marketing is greater accountability. The availability of metrics has had a huge impact on business relationships, and it’s also allowed for some direct partnerships to develop that might not have happened in the past.

In the same way that the web allows consumers to find manufacturers directly, cutting out the middleman, it also allows would-be advertisers to bypass media buyers and partner with publishers directly. So we now see manufacturers connecting with niche publications that directly cater to the audience that would consume their product. They’re bypassing the standard advertising relationship, which is often CPM-driven.

Online publishers who truly “own” a niche audience, can track visitor behavior precisely, providing an asset that can be leveraged with advertisers. Niche publishers, in fact, have the ability to prove they can help advertisers get into deeper relationships with audiences. So instead of spending time simply trying to sell more advertising on a CPM basis, they can focus instead on creating opportunities to advertise products or services that are directly relevant to their readership – and thus get a much higher effective CPM.

Because it’s tracked, the risk is driven down to limited tests. Advertisers can know exactly what worked and even a fair amount about whom it worked on. There’s more direct and more accurate feedback than there was from old advertising models, too.

The infamous quote by John Wannamaker, "Half the money I spend on advertising is wasted; the trouble is I don't know which half.", may becoming obsolete. But the accountability inherent in the new, metrics-driven model changes that. It allows advertisers to shift some risk back to the publishers – risk that publishers are willing to take on when the metrics justify it.

The new dynamic can actually get better product in front of consumer markets and also level the playing field for companies with better products. They can now reach markets with much lower upfront marketing expenditures.

A whole new era of deal-making has begun, primarily because of the accountability that metrics bring and because deeper analytics give the ability to break things down to such a granular level. But publishers and advertisers will need to align more closely while walking the tightrope. Collaborative efforts mean that businesses become more intertwined and depend on each other for success.