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Monday, October 25, 2021

New Digital Companies, Old Ad Habits

This article is part of the On Tech newsletter. Here is the collection past columns

I have nothing against advertising. They make it easier for us to watch Monday Night Football and read The New York Times. I love a well-done weeping TV commercial.

What I don’t like is young companies that are becoming addicted to advertising – to the detriment of us, and maybe even them.

DoorDash this week started focusing more on restaurants that pay to have their ads appear when people are looking for pizza or tacos. Its competitors Uber Eats and Grubhub offer similar ads. Instacart, a grocery delivery startup, continues to expand its paid product placement. Even Amazon continues to hand over more retail real estate to merchants who pay to scold us with their dog bedding.

At its best, advertising can help us find something we didn’t even know we were and save money. (Coupons are also advertisements.) The trick is to find the right balance between serving the companies that pay the bill for the advertisement and the interests of those of us who receive it.

I’m afraid more and more companies have gone from advertising fair to devilish deal. Companies like DoorDash, Instacart, and Amazon run the risk of making our browsing and shopping experience online. squalid adding more advertising, often irrelevant. And let’s be honest, it’s useless to see a burger restaurant in the best location on Uber Eats, not because the food is good, but because it pays for the privilege of being there.

Companies that have gotten into advertising as a side bustle rely on advertising for two reasons: peer pressure and criticism of the financial shortcomings of app-based delivery services.

I sympathize. Sending couriers to restaurants or grocery stores and then to your door is no easy task. I understand why Instacart is charging money from Altoids to be the first product listed in the app’s snack section. I understand why Altoids are willing to pay to stand out.

And ordinary supermarkets have been doing this for a long time. Those tokens at the end of the aisle could have paid the store to be there.

We still shouldn’t be happy to have introduced useless marketing to a new generation of purchases that promised to get better. And whether it’s a physical store or an app, there is something perverse about browsing the aisles while the company makes money by directing us to one brand of toothpaste and not another.

Jason Goldberg, director of commercial strategy for advertising company Publicis Communications, told me that digital advertising has become a race to the bottom.

Three companies that are important portals for online information – Google, Facebook and Amazon – are gradually increasing their advertising volume. They devote more screen space to links, messages, or products from companies that pay to be visible to our eyes, and less information that companies believe may be most relevant to us.

Read Also:  Can we have useful conversations on the Internet?

This relentless shift towards more advertising on the Internet and in traditional media like television has left everyone else thinking about doing the same, Goldberg said.

The best defense for what companies like DoorDash, Instacart, and Amazon are doing is that advertising can make user-friendly services more accessible. The Instacart boss said the ads are helping to drive down grocery shipping prices. DoorDash can charge lower commissions from most restaurants and offer paid promotions for those willing to pay for it.

Now I’ll be my usual grunt: If delivery apps or other convenience services we love have to be subsidized by ads we hate, maybe those convenience services don’t make financial sense?

Sridhar Ramaswamy, a former Google executive in charge of advertising, called ads a “stress relief valve” for companies under financial pressure. “It looks like free money,” he told me.

Ramaswami left Google and founded Neeva, an ad-free digital search company that makes money from the subscriptions of people who pay for the service. I don’t know if the Neva will succeed. But we should be glad that more and more companies are trying to get rid of bad advertising habits.

  • Is Instagram bad for kids? It’s Complicated. My colleague Jessica Grose goes deep into some of the studies that make teenage girls feel worse about using social media and gives advice to parents. Farhad Manju of the New York Times Opinion tells us a brief history of moral panic over video games, sexting, and urban gangs, and says that exaggerated fears can distract us from underlying issues.

  • Okay, * who * makes a living on the internet? Axios asks an important question: Is the economy of creators of people doing what they love on YouTube, Twitch or Substack more democratic than the old entertainment and media industries? Or is it only 1 percent of the stars who make good money, while everyone else is chasing a penny?

  • How Slack is changing the office work: The Atlantic has long read about how Slack and similar chat apps for office workers blur the lines between work and life and empower workers to challenge their bosses. We’re still looking at how technology like this affects the way people interact.

Alyssa Barry makes captivating videos on TikTok about life at her Florida animal shelter. This is Wilbur the pig, “helping” Barry to make his morning rounds. (I first read about this TikTok account from my colleague Julia Jacobs.)

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