Jarvis: Doomsday for Content, Ad Spending To Drop

Media analyst Jeff Jarvis has some harsh news for content providers, new and old: You’re screwed.  Why?  Because the Internet is allowing companies to “go direct” to customers, soliciting advice, explaining new products, making new pitches, etc. 

As this direct communication channel matures, Jarvis argues, marketers’ enthusiasm for placing annoying messages rear unrelated news and entertainment content in hopes of catching readers/viewers’ attention will wane.

Will advertising go to zero in this scenario?  Of course not.  But it doesn’t have to to wreak havoc on content providers already struggling with the inability to charge subscription fees, increasing competition, disintermediation, and the commoditization of news.

Jarvis in the Guardian:

[T]he real threat to the advertising gravy train comes not from any change in media, but from a fundamental shift in the relationship between companies and customers that has been made possible by the internet. This hit me like a fist in the face when I went to Texas to interview Michael Dell…

Long story short: in June 2005, I blogged about my bad laptop and eventually, thousands of fellow frustrated customers gathered round, via comments, links and emails, with their complaints. The Dell response to blogs then? Look, don’t touch. This came as Dell’s customer-satisfaction ratings dropped, its earnings disappointed and its stock fell. That August, I returned my Dell, bought a Mac, and blogged an open letter to Michael Dell urging him to read blogs, write blogs, listen to customers’ advice, and “join the conversation your customers are having without you”.

The following April, Dell did join that conversation. Suddenly, technicians were contacting bloggers to solve their problems. Dell started a blog. Michael Dell opened IdeaStorm, a site where customers could tell the company what to do; as a result, Dell is now selling Linux computers and reducing the “bloatware” on new machines. They’re starting wikis where customers can share what they know and extending forums where they help each other…

Dell and its customers are collaborating on the creation of content, media and marketing – without content, media or marketing companies. Advertising is no one’s first choice as the basis of a relationship. For marketers, it’s expensive and inefficient. For customers, it’s invasive and annoying. And targeted advertising is only slightly more efficient and slightly less annoying. Clearly, the direct relationship between a customer and a company is preferable. But that direct connection cuts out the middlemen – that is the media.

See Also:
Next Phase of the Social Networking Revolution is B2C
Woe is News: AP CEO Bemoans Google, et al.  We Annotate

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.

Tagged In