Listen to this post:
Have you ever been bullied?
Most of us have been bullied at some time in our lives (usually by the mean kids in school).
Although it’s “invisible,” most companies who advertise online have been bullied too. By other bigger companies who are bigger than them.
Have you spent your hard-earned marketing budget running online ads that just don’t seem to get any traction?
Do not let poor campaign performance lead you to believe that there is no market for your products or services.
There’s a reason that small to medium sized marketers like you
struggle in the digital ad space…
Display ad space is a limited resource. It is not infinite, although malicious players do try to find ways of manipulating it all the time.
The fact is, there are only so many premium publishers online who have ad space to sell, and the demand for this prime real estate is increasing every day due to the rising popularity of online advertising.
Any resource that has a high demand and limited supply is subject to an increase in price. Lots of people want it, but there is only so much to go around and therefore the cost goes up.
But massive multi-billion dollar ad budgets by Fortune 1000 companies are inflating the cost of CPMs and pushing early-stage entrepreneurs– the world’s value creators– out of the digital advertising space.
Here’s a look at how smaller, independent marketers are being marginalized and ultimately bullied out of advertising online and how tribeOS will finally even the playing field, giving you an actual chance at running high-profit, high-return campaigns.
Where We Buy Digital Ad Space
There are a couple of different options available to marketers who want to advertise online.
Usually, an advertiser will use an Advertising Network or an Ad Exchange to run ads for them. Both are designed to connect advertisers who want their ads to show up on certain websites, to publishers who want to host display ads in order to generate revenue.
An Ad Network keeps track of all available ad space from registered publishers and uses a central database to serve up ads on specific websites based on whatever campaigns are active at any given time.
An Ad Exchange is a platform that allows advertisers to purchase inventory from multiple Ad Networks. It’s often compared to a stock exchange because advertisers are given access to a larger pool of publishing websites from a collective of networks instead of just one.
The upside to using an ad network is that very often they have massive amounts of consumer data at their disposal because they are commonly associated with major social networks, communication platforms, and some the most highly adopted infotech services in the world.
So these platforms offer advertisers the opportunity to drill down on their target demographic market segment and refine their ads for optimal relevance based on information that is voluntarily provided by individual users.
The downside of using networks is that they have become infected by very high levels of fraud, they operate with very little to no transparency, do not provide clear information about where ads were shown and who saw them, and the network takes a substantial amount of every dollar processed (often as much as 50%).
This means that publishers get a very low portion of the revenue share that is generated by their website and advertisers are not seeing their campaign’s full ROI, whether that be because of fake traffic or bunk placement.
How We Buy Digital Ad Space
Ad space is purchased using the Pay-Per-Click model where inventory is bought on the basis of how many impressions it receives.
You pay for impressions in bulk that are measured by CPM, which stands for cost per thousand. A $1.00 CPM means that for every 1000 impressions an ad receives you pay $1.00.
The parameters for what kinds of traffic an advertiser is looking to get and how much they are willing to pay are set in advance.
For instance, I can specify that I want my ad to show up only for users who are female, between the ages of 24 – 35, who have children, an annual household income of $100,000+, are located in North America, and that I am willing to pay $4.00 for every 1000 impressions I receive from this audience.
However, under the PPC model, advertisers are in constant competition with one another. Bids are placed on various display opportunities auction-style through a process called Real Time Bidding (RTB).
RTB is like a live auction that is triggered every time a new user loads a page. Each time RTB occurs you are up against thousands of other advertisers who are vying for the same spot. Over 3 Million businesses advertise with Facebook, and another 1.5 Million are using Google.
Not only is the room crowded, some of the other people there have budgets as high as $10 Billion to spend on online advertising every year.
That’s who you’re up against.
It’s like going to an auction with only $100 to spend, having to bid on items in advance before really knowing what they are, and then bidding against others who have stacks of cash to throw around.
Their bids, which are much higher than you can afford, will win all of the premium inventory leaving you with scraps.
How Industry Bullies are Monopolizing Digital Advertising
In today’s world of digital advertising, you have a bunch of bullies, big corporations and over-funded startups, that have huge amounts of capital at their disposal.
These are folks who have incredible amounts of money to spend like Procter & Gamble, the biggest advertiser in the world, who spends over $28 Million on digital ads per day.
They’re concerned with marketing their various brands and making sure to use their allotted ad funds so they don’t disappear from the annual budget.
So they’re able to make very high CPM bids with little regard for targeting and engage in reckless campaign spending. I call this spray-and-pray style campaigning, where big advertisers roll out campaign after campaign to virtually anyone and everyone just because they can.
It drives the costs of digital ad space up because of simple supply and demand dynamics.
If you’re up against big brand advertisers, how much of a legitimate chance does your bid have at winning the banner spot on premium websites?
Killing Entrepreneurial Dreams
What these companies are doing is basically squeezing out real people with real businesses, real products that have real value.
The real kicker is those small, independent brands that have a real urgent need when it comes to digital advertising. It’s life and death. They need to find their tribe and find their market or they won’t survive.
I’ve been through it myself. I had to let go 6 people recently in a 14-year old business because we couldn’t make pay-per-click advertising work anymore. The cost of the clicks got too high, conversions dropped and we were ravaged by fraud.
And it’s a shame because there’s probably someone out there who that desperately wants what you have to offer but can’t find it because big bully advertisers are throwing stupid amounts of money into the system and buying up all of the quality digital ad display space.
Not only are they squeezing space advertisers out of networks but they’re also funding spammers and scammers. In fact, it’s precisely this reckless spending that’s funding ad fraud.
This is only HALF of the story. The other half of the bullying comes from the advertising platforms themselves. The pattern that has repeated itself over and over again has been that brave entrepreneurs take the risk early on and then they get kicked out in favor of major corporations.
Big networks routinely blacklist advertisers, often without warning or any available options to appeal the decision. Since 2008, Google has permanently banned millions of advertisers from its platform. Last year alone, Google blocked 3.2 Billion “bad ads.” Double what they flagged in 2016.
A permanent ban on Google includes access to all of its subsidiary sites including YouTube, which has undergone major policy changes in the last year. These changes, while officially undergone in an effort to eliminate predatory behavior and win the trust of big corporations, in practice serve to harm small and independent content creators and often have devastating consequences.
Protecting Ad Fraud
Big advertisers and the agencies that represent them are incentivized to continue to make big ad spends.
Marketing teams have a certain budget at their disposal, and in big corporations, if you don’t spend it then it goes away. Because budgets evaporate if they go unused, marketing teams are encouraged to use every last cent.
They try to find channels for wide distribution and broadcast and they just throw money at them. Performance and analytics reports, metrics on how well the ad ran, aren’t important. If they’re even documented, it’s very doubtful that they’re read.
The agencies that represent them are paid a 20%+ commission on ad spend. So they’re incentivized to spend recklessly because they’re getting huge kickbacks.
And the networks themselves could care less because a dollar spent = a dollar processed = $.50 for them.
All of this combined is distorting and manipulating bidding practices, placement for display ads and inflating the costs of advertising online which in turn mean that small and independent business owners and entrepreneurs are paying a false premium (probably 4-5 times the value of the actual ad) to run digital ads on major networks and getting scraps when it comes to bidding on display space.
But Not Anymore.
The Solution: The Fairness Algorithm
tribeOS is the first advertising marketplace that plans on protecting small and medium businesses forever without being pushed out by overfunded fat cats and bullies.
And the way we do so is by creating what we call The Fairness Algorithm.
We have designed tribeOS to reserve a percentage of our ad inventory for small, independent advertisers and entrepreneurs (the oxygen of our economy) and give them the impressions based on variables that DO NOT INCLUDE BID. We will also give new advertisers and new ad campaigns a special edge. This means that the small guys can win.
It’s kind of like PBS or public access television except it’s not going to be just crappy local 4 am slots. It’ll be national, prime time, and premium inventory for the world’s most ingenious, innovating, game-changing value creators.
The tribeOS fairness algorithm is designed to make sure that publishers are serving up the right ad to the right person at the right time using feedback mechanisms like quality and relevancy scores in combination with our advertising tools.
A Healthier Ecosystem
As a consumer, isn’t it more interesting to see a wide variety of new offers, companies, and ads? How many times can you see the same ad before you’re sick and tired of it?
The Fairness Algorithm ensures a fresh variety of new ads and companies are seen. This allows you to discover the new exciting solutions, services, and products. Isn’t that better than seeing the same old thing 100 times?
And yes, tribeOS will continue to protect the up and coming value creators now and forever.
Is that you? Sign up for the tribeOS waitlist and join over 30,000 other advertisers and publishers who are ready and waiting to end ad fraud, eliminate ad-waste, and get more ROI with the same ad spend…