Welcome to the opening chapter of our enlightening series on the transformative landscape of advertising. Join us in exploring the storied past and pressing challenges facing today’s advertising industry, one of the most discussed topics at SiBorg recently.
A Brief History of Advertising
Advertising isn't a modern invention. It dates back to the late 19th century with the emergence of print media. Newspapers and magazines expanded the reach and frequency of advertisements, marking the beginning of structured advertising. By the 1920s, radio advertising had taken the stage, becoming a popular medium to reach a mass audience, particularly for consumer goods. The post-World War II era ushered in television advertising, which combined visual impact with targeted strategies aimed at niche audiences, significantly enhancing consumer engagement.
The digital age accelerated these trends with the rise of the internet and email marketing in the 1990s, introducing models like pay-per-click advertising. By the 2010s, programmatic advertising had revolutionized the scene by automating the buying and selling of ads, optimizing targeting, and reducing costs. This era marked the dominance of giants like Facebook and Google in the advertising realm.
Mass Behavior Modification
The evolution of advertising has not been without its pitfalls. A notable issue is behavior modification by platforms such as social media and entertainment sites, which can lead to user addiction. Here’s how the cycle works:
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Platforms capture attention by leveraging human emotions, leading to addiction.
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Increased user time on the platform allows for more extensive data collection.
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This data is sold to advertisers, enabling highly targeted ads that further increase user engagement.
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A feedback loop is created where ad revenue fuels the refinement of engagement strategies.
This manipulation of emotions can have severe consequences, including social anxiety and depression, as platforms use tactics that may emphasize negative reinforcement over positive.
Alignment Challenges Between Media Platforms and Advertisers
Today's advertising landscape often fails to incentivize the creation of high-quality ads, leading instead to an influx of low-quality, sometimes deceptive advertising. Many of us have encountered less-than-trustworthy ads promising the latest 'airdrop' or miracle product. Moreover, the reliance on user data to maximize revenue can create alignment challenges, including:
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Brand safety risks, where ads might appear alongside controversial or inappropriate content.
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Ad fraud, where the authenticity of clicks and impressions can be questionable, diminishing return on investment.
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An increase in intermediaries, complicating the ad delivery process and affecting transparency.
Data Privacy: A Double-Edged Sword
On one hand, users often prefer relevant ads that resonate with their interests. On the other, handling such data responsibly requires immense care to avoid manipulation and privacy breaches. Mishandling of data is rampant, with incidents like the Twitter API leak in 2022 or the Cambridge Analytica scandal in 2018 affecting millions. Despite regulatory attempts, loopholes and challenges persist, leaving user data vulnerable.
Looking ahead, our subsequent articles will delve into how web3 technologies aim to redefine these challenges, championing a new era of advertising where transparency and user empowerment are paramount. Stay tuned for an engaging exploration into the future of advertising, guided by innovation and user-centric principles.
In the second article, we will explore what Web3 can bring to the advertising industry and how SiBorg can propel this industry into a new era