Can consumers & advertisers find the sweet spot?


“If the service is free, you’re the product.” This statement that comes up every so often in our consumer zeitgeist is attributed to video artist Richard Serra. He said this in a video critique of mass media called Television Delivers People all the way back in 1973. While in the original video, Serra was talking about the TV and advertising ecosystems, he didn’t say these exact words, the sentiment has never held more true.

In an increasingly digitized world, where screens and their constant stream of audio-visual media, information, and of course ads, dominate our lives, exchange4media asked several industry veterans about this increasingly ad-saturated media landscape, and where in that do consumers draw a line in the sand.

Gopa Menon, Head of Digital, Mindshare South Asia, says it used to be a simple trade-off: free email, free social media, and free music, in exchange for a little advertising. “But lately, the ads seem to be multiplying like how, taking over our screens, while privacy concerns give us all a case of the jitters. So how do we get back to a happy place where these platforms can thrive and we can enjoy their services without feeling like data points in a giant marketing machine?”

Various industry reports say many consumers around the world are exposed to anywhere from 4000 to 10000 ads a day, out of which only about a quarter of them are relevant to, or even noticed by the users. And while of course ads come emblazoned on billboards on the streets, and printed on newspaper sheets, scream at us from TV screens, the increasing majority of them are flashing across any device you’re currently reading this article on, any device that’s connected online.

Venugopal Ganganna, CEO, Langoor Digital, agrees saying, “Let’s be clear: free digital services aren’t truly free. Platforms create value by collecting user data and preferences. This data fuels targeted advertising, allowing companies to reach specific demographics with laser focus. This targeted advertising translates into higher revenue for businesses, which ultimately benefits the platform by attracting more advertisers. Users, on the other hand, gain access to valuable services – connecting with friends and family, consuming news and entertainment, or using productivity tools.”

The free digital ecosystem is here to stay, but marketers, and oddly enough consumers, are saying, with increasing frequency and volume, it doesn’t have to be a one-sided bargain.

As Siddharth Jhawar, General Manager, Moloco, observes, “Bad ads are spam, but good ads are content. If media platforms can use sophisticated targeting to show relevant and hyper-personalized ads to users, they will naturally see higher engagement. However, if one uses a brute force approach to carpet-bomb users with the same irrelevant ad again and again, it will obviously lead to user fatigue and churn.”

Deepak Verma, COO, Images Bazaar, a repository of India-focused visual content that it supplies to brands, marketers and other stakeholders, points out that online privacy and data security are complex issues, since digital services rely on advertising revenue to provide free products, but users are concerned about the privacy of their data.

All agree that the current system has its drawbacks. The ever-increasing presence of intrusive ads disrupts the user experience, and privacy concerns are valid, while  users deserve a transparent, and indeed, far better value exchange.

Menon notes that while there might not be a one-size-fits-all answer, there could be some wiggle room or adjustments made. “Platforms could offer tiered subscriptions – a free version with basic features and targeted ads, and a premium option with more control over data and a (hopefully) ad-free experience like many of the platforms are trying to experiment with. Users, on the other hand, could be more mindful of the data they share and the permissions they grant.”

Verma says it is vital for users to be informed about the digital services they use and to search for alternatives that prioritise privacy and security. “While it may be difficult to completely avoid ads or data collection online, users can take steps to limit their exposure and protect their information.  Ongoing communication and collaboration will be required to achieve a satisfactory balance between users and digital platforms. As the digital landscape grows, all stakeholders must collaborate to develop solutions that meet the needs of both users and businesses.”

Menon says it’s all about finding that sweet spot where both sides feel valued – “the platforms get to keep the lights on, and we hope to enjoy the digital world without feeling like we’re constantly being watched.”

To achieve balance, Amita Srivastava, Vice President – West, Carat India, says platforms must prioritize transparency and control over data practices. Tiered subscriptions could offer ad-supported basic features for free, while paid tiers provide an ad-free experience and more data control. 

“Ads could be less disruptive if they align with user interests, and opt-in programs could incentivize engagement. Ultimately, platforms must focus on delivering real value beyond being free,” she says. 

Challenges include implementing these changes and convincing users to pay for extras. “Despite the hurdles, by prioritizing ethics, complying with regulations, educating users, and leveraging technology, platforms and users can create a sustainable digital ecosystem that respects privacy and is financially viable,” adds Srivastava.

Jhawar concurs, saying the secret sauce here is to solve for relevance and frequency. “If a user shows a pattern of not engaging with a certain type of ad or creative, the ad serving system should be intelligent enough to back off and not let the customer experience go for a toss. Machine-learning backed ad-tech makes this a win-win-win for the media platform, advertisers, and customers!”

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Read More: Can consumers & advertisers find the sweet spot?

2024-04-16 03:42:33

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