Ad Tech’s Impossible Mission
Why ad tech won’t be the internet’s savior in its battle for television dollars.
When it comes to the promise of the internet conquering advertising and solving Wanamaker’s dilemma of “Half the money I spend on advertising is wasted, the problem is I don’t know which half,” the internet’s main weapon in its arsenal has always been advertising technology, known in the industry as simply “ad tech.” The improved technology of advertising was to be the secret weapon that would bring additional efficiency and solve Wanamaker’s dilemma. To this day, financiers and other bullish proponents of the internet claim that all of the ad money spent in our economy will inexorably migrate over.
While the internet has recently begun to expand past its advertising roots, advertising dollars still comprise a massive share of all internet-related revenue — to the tune of over $200 billion worldwide. Moreover, advertising shapes the very products of the internet. As we’ve mentioned before, ad spending has exceeded VC investment in the internet every year since 2001.
Ad tech showed early promise on the internet, vastly improving upon older media and methods for direct advertising: that is, sales- and promotion-based advertising. Google was instrumental in the migration of billions of dollars, as their…
