JamieG Analysis

Recently Philip Hodgetts remarked on how the future of digital media and advertising. http://www.philiphodgetts.com/2009/10/30/how-will-branded-media-replace-advertising/

I had visited this topic a few years ago in older posts.  Strangely enough looking back now, we do not seem any closer to many questions we need answered.  One of the big ones to me is:

Regional Price per item advertising can make up to 70% of the ads we see on TV. How does the new digital media future replace this?

Just to look at this issue.  New Digital Media advertising is very much based from a single producer making content for distribution all over the world.  This is a very cost effective model but cannot replace that 70% gap left behind in typical localised TV and radio.  You need more infrastructure (People on the ground in that local, regional content distribution and creation with regional advertising combination etc.).  The price structure of new Media simply cannot support these old school ideas on advertising.

So where does this 70% go.  Google has tried hard to build a solution but does not appear to be very successful “yet”.  The idea was to turn new media advertising into a Web advertising type model. The idea is to use the regional website poster ads and turn this model into an infrastructure engine to replace the 70% of TV/Radio advertising model.

Unfortunatly, what you can build and how business works are not always the same.  And from what I see, the business of media buying, in which you have large advertising companies talking to huge media buyers and making a lot of this 70% of traditional advertising spend..  They want to keep it the same.  This new model cuts them out.

So where to now?

No idea really. (If I knew I wouldn;t be writing this would I).  I personally see the slow and eventual rise of networks like TWIT.TV and similar ones that build local advertising into local content.  They will slowly grow until they errode the traditional methods.