Congratulations, Rocketboom

So Rocketboom’s ad auction came off with a rather obscure advertiser — TRM, an ATM and photocopy vending company — getting the privilege to be the first to promote on the hottest vlog … and to get free publicity because of it. Good for TRM and good for Rocketboom, valuing a week’s worth of commercials at $40,000 (and good for me not being made a liar predicting in The New York Times that they would be worth a high CPM).

But this is bad for big ad agencies and big advertisers who missed this boat bigtime. I’m not talking about any specific brand or company (disclosure: I know of some advertisers but I’m not talking about them; I’m talking about the ones that didn’t even have the courage to try). They should have been falling over themselves to grab this unique bargain. And they should be slinking off with their long tails between their legs now. Advertisers constantly whine that they want to do something new, but when something new comes along, they freeze because they can’t fit the new thing into their definitions of old and safe.

And here we have in a microcosm the explanation of why media is so horribly out of sync today: The public is valuing new media much more than the old, but the advertisers still value the old. Most every newspaper and in many cases TV networks and magazines have much larger audiences online, but the revenue for their old media properties remains much higher because the advertisers and agencies still value the old and the safe. They want metrics. They want control. They want guarantees. This, in turn, makes big publishers and producers play it safe because they don’t want to mess with the cash cow. And that means that advertisers miss the opportunity to reach a larger, younger, smarter audience in the new medium, which is — supposedly — what they’re dying to do. And that means that big media companies now face competition from a thousand Rocketbooms and a million Gawkers. That allows a TRM to come along and snatch away an opportunity from the big, lumbering giants. That is why small is the new big. Small be nimble, small be quick, small jumped over the conglomerates.

Or let me summarize the problem in one word. Big advertisers and big agencies are chickenshit. They need to grow some balls or else they’ll find new competitors running circles around them. The explosion — the rocketboom — that has already come to newspapers, magazines, TV networks, the music industry is coming next to the ad business.

Please take this, advertisers, as a friendly kick in the pants.

  • http://www.bloodandtreasure.com Noel Guinane

    Unbelieveable. Congratulations Rocketboom!

  • http://flig.us Eric J

    There’s a line I remember from an article in Wired in the very early days of internet advertising. Advertisers were disappointed in the click-through rates they were getting, and whoever was being interviewed said “Well, what’s the click-through rate on a billboard?”

    I think that question is just as applicable today as it was then.

  • Duneview

    Are Big Agency/Advertisers chickenshit or just prudent?

    The CPM’s generated by Rocketboom’s auction is indeed jaw dropping compared to say, the Super Bowl. Good for them, congratulations and I’m glad they will have a little capital to plow back into the operation.

    Recognizing it’s in advertisers’ interest to nuture new vehicles and even act as patrons to potential media, it’s still important to remember adverting’s primary goal is to move product efficiently. Jeff, I never recall browbeating advertisers and calling them names as an effective tactic to win business, but then again I never was a print guy.

    I do know when something is terribly overvalued eventually it comes home to roost, but I guess as a Time Warner paper holder you know that.

  • http://www.ditisberry.nl Jaap

    Not all big companies are slow. On Adam Curry’s Daily Source Code I heard today that Earthlink ordered a whole new advertising campaign at Podshow.com (with which quite a few larger podcasts are affiliated), and that they decided to start using user generated ads. Up until now, they’ve been using standard radio voice over ads, which generated a lot of criticism throughout the ‘podosphere’. But only two months later, they’ve apparently changed their PR policy rather drastically, embracing a very novel way of advertising. And I think that’s wonderful, because it would be great if more bigger companies would catch up – Earthlink is currently a significant contributer to the further growth of the podosphere. Although Jeff is quite right, I do think that many big companies are not only slow but also very intelligent.

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  • http://www.interactionsociety.com/blog/ Jeff Tidwell

    You couldn’t be more right.

    Who is going to step up and lay down some (not even) risky cash to sponsor Dawn and Drew for a week? Those two will give you a level of advertising creativity that hasn’t happened since the “Dawn” of television!

    - Jeff

  • http://rayedwardscopywriting.com Ray Edwards, Copywriter

    I agree with you that if a company (whether advertiser or agency) says they want to do “new things” then they should display the courage to follow through. However…

    One of the advantages of new media is the ability to measure – scientifically – whether the investment has paid off. “What’s the click-through rate on a billboard?” is a good question, because obviously nobody knows the answer.

    The great Ogilvy himself said that only 50% of his advertising worked; he also said he never knew which 50%.

    Now along comes the web, which is the perfect direct response advertising medium, and we can know for certain whether a campaign works or not.

    For those who wince at my calling the web a “direct response advertising medium”: I’m sorry if it offends, but just “getting your name out there” is not good enough. The real measure of success is: did the campaign bring the “most desired result” (a sale, a lead, or an opt-in)? If not – it didn’t “work”.

  • http://ryantate.com Ryan

    “They want metrics. They want control. They want guarantees.”

    And yet all of these are superior online than offline, so I don’t buy that this is why they are chickenshit. Although I do buy that they are chickenshit to begin with ;->

  • http://kmareka.com Kiersten Marek

    The advertising industry is figuring out that there’s no more economical venue than the internet. We have gone from 1 to 4 advertisers in the past 2 months. Rocketboom got some nice breaks from the MSM (Business Week being one) that helped launch their success. I like that they set limits on how they will allow advertising into their program. I hope to have a modicum of success at this myself, but my priority (for better or worse) will always be producing quality independent media. Even if there was no income at all (which there wasn’t for the first three years) I would still do it because I believe in it.

  • http://www.bigpictureblog.com Simon Andrews

    Ad agencies these days are factories that produce TV commercials- the whole new media thing scares them as they can’t make a business out of it – they have too many overheads. Some clients see this but find it hard to get good advice – whcih is why we started Big Picture.
    Its time to experiment!

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  • bit torrent

    Surely this will change their content? They can no longer use material that is released under a Creative Commons ‘no commercial use’ license and the days of including large amounts of copyright material (entire old ads such as the scooter one and entire pop records) must be over, as they are much more likely to get sued now?

  • http://www.animalnewyork.com Bucky da ANIMAL

    Hallelujah Jarvis,

    I couldn’t have said it any better myself. My advice to all young publishers, whether print or online, go to the brand first. You may have a much better chance pitching the brand then the media planning agency. Talk about not getting new media? Well these media planners are the first culprits. Seriously,
    I know there are certain protocols and brands hire these people to do the “media plan.” But I implore publishers, don’t waste time trying to convince some jr. media planner that your publication or property is valuable. GO directly to the brand. Get their attention. Cause in the end if the brand doesn’t know about you, or you’re not on their radar, you can forget your chances with the media planner.

    ed note. I know this moved slightly off topic but seemed necessary.

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  • Ad Man

    Believe it or not, I suspect most big agencies would regard Rocketboom as so small time as not to be overly impressed with the whole deal. No offence to anyone (and I say this based on the fact that I’ve worked in one of the biggest ad agencies in New York for about ten years, and have worked on digital accounts with tens of millions of dollars in spend.)

    That’s not to say that agencies are or are not doing interesting things (varies from agency to agency), but just a perspective. My own take on this is that a lot of the 2.0 web community sometimes overvalues their own media influence, especially in the heartland where the greatest volume of most companies products are sold. When my own blog gets dugg or slashdotted (and I’ve had both) it gets less than 10th of the traffic from when it makes Fark or Collegehumor. Again, just one person’s perspective.

  • http://www.bigbrainboy.com/blog/bigbrainboy/comments/congratulations_rocketboom/ BigBrainBoy

    Congratulations, Rocketboom?

    Jeff Jarvis, the founder of entertainment weekly and seer into the internet media future, posted a slightly different take on the “small internet mice will destroy old media dinosaurs.”

  • http://www.christopherkingesq.com christopher king

    Small today but of increasing importance tomorrow. In a few years ALL entertainment media will be broadband, and entities like Rocketboom are just the start. Major advertisers are just laying in the cutty.

    And I know people who have worked for Needham, Saatchi, etc. who agree. Hence, my team and I are about to put out a new video page to replace the home made website:

    http://christopher-king.blogspot.com/2006/03/new-look.html

    http://christopher-king.blogspot.com/2006/03/espionage.html

    Peace.

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  • http://www.become-a-copywriter.com Kevin from become-a-copywriter.com

    After 20 years of giving my blood on the streets of NY to places like JWT and especially McCann, I hope in my lifetime to see the death of traditional ad agencies.

    Screw em all.

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