The Advertising Apocalypse That Never Was

Media Execs confused by the Clowns they listen to.

Despite the predicted doom and gloom, adspend has not cratered in anticipation of global economic collapse.  Quite the contrary.  But those predictions have caused a mini-crisis for publishers in what can only be described as an own-goal in a game that is far from over.

Six months ago, nearly every major news outlet had at least one article predicting the end of a long-running boom in digital publishing.  The common-sense logic from business writers publishing articles for money was that fears of recession, or even total global collapse, might (and often ‘is’) forcing big-brand advertisers to abandon advertising altogether.  The result has been a confused mess for publishers everywhere and the investors that support them.

In the real world, advertising spend has not cratered.  The end-of-the-world-as-we-know-it has not come to pass.  In fact, digital advertising spend has increased substantially.

“Our Advertising business continues to deliver robust growth,” said Amazon CEO Andy Jassy during the companies Q1 2023 earnings call on April 27th

Amazon’s ad business in fact delivered US$9.5 billion in revenues, a reported 21% year on year increase.

See a transcript of Amazon’s Q1 2023 earnings call here.

What all that doom and gloom from business writers did was warn investors away from a new generation of publishers that benefit most from the digital economy while delivering a counter-offensive to the long-running wave of fake news and malignant information sources that management teams and audiences are only now beginning to reject. 

Many of those publishers paid those business writers for their articles on the death of publishing.  The irony is tangible. 

Pulitzer prize-winning digital native BuzzFeed News was shuttered completely just last month. 

See an excellent discussion with Ben Smith, Editor at BuzzFeed News, on “Digital Media’s Convulsions” from Vanity Fair.

Jonah Peretti
Jonah Peretti, Founder & CEO of BuzzFeed, and co-Founder of Huffington Post. Image credit: Manuel Blondeau, AOP.Press/Corbis/Getty

Luckily for our species, all is not lost.

Risk and Reality

Throughout 2022, it was popular wisdom among business journalists that the fear of economic recession would force advertisers to cut back dramatically on marketing budgets.  The immediate and logical result of that assumed logic would clearly be hardship for any business reliant upon advertising revenues.  Right? 

In the news business, doom and gloom sells.  Articles across business sections of most publishers practically wrote themselves.  But the realities of a global pandemic coinciding with global digital transition can be more complex than simplistic logic allows for.  And this has proven to be the case.

The result is a divergence between perceived risk for investors and the reality of market performance.  With this divergence comes serious investment opportunity.

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For well over a two decades, the growing prevalence of programmatic advertising across digital natives has transformed the economics of publishing into something else entirely.  For the many pre-digital publishers and news outlets that have helped to build many of the most prevalent media conglomerates, the transition to digital has been heartily embraced, if not fully understood.  An entire generation of editors and producers that built their careers, and the revenue streams of their employers, on the business models of traditional journalism and publishing are now sitting confused in boiling water.

Technology has enabled instant and often unconstrained global dissemination of information, any and all information, to consumers everywhere, by anyone.  Society understands this.  Politicians understand it.  But journalists and the editors they become, not so much.  Publishers once fully committed to traditional research-based, and fact-based, journalism have given way to opinion journalism, for better or worse, but certainly for money. 

With nearly every web-site, and increasingly apps, becoming a source of public information and generating programmatic ad revenues based on how many visitors they can attract, the erosion of research and facts from the articles being consumed has been inevitable.  So it should be no surprise that the journalists that write articles about advertisers doing anything but what a journalist thinks they should have completely missed the facts, which only a little research would have demonstrated.

The problem for many of these journalists, and for the publishers who pay them, is that investors read what they write, listen to what they say, and often believe every word … for a while.  The public can be moved by sensationalism, but they want truth.  The psychology of crowds would suggest that, while the public can be led astray en masse, it will never stop moving and will inevitably wake up and move back toward reality.

The result is that many emerging publishers that are once again successfully delivering researched, fact-based journalism, such as BuzzFeed News, have lost the support of their capital investors just as business models are beginning to match popular consumer sentiment.

This offers both a crisis for publishers, and an opportunity for those professional investors that recognise the truth before the journalists do.

That truth is eventually outed by facts, and those facts can be found within the earnings calls and periodic reports from those companies that actually know them.

Google’s advertising business, through which consumer data is sold to advertisers, who in turn pay Google to place their ads across millions of publishers, generated US$40.4 billion according its Q1 2023 reports, up from US$39.6 billion a year ago.

According to the Interactive Advertising Bureau, digital advertising revenues grew to US$209.7 billion in 2022, surpassing US$200 billion for the first time ever.  The AIB Internet Advertising Revenue Report, conducted by PwC, reported that digital advertising revenues to internet publishers increased by US$20.4 billion in 2022, or 10.8% year on year. 

The Price of Free Information

The internet is an economy.  Every website that offers access to information, products or services does so for a purpose.  That purpose is typically money.  That money typically comes as a result of a transaction.  For products and services, the web-site itself is a form of shop-front.  The transaction is simple and clear.  But for the vast majority of websites on the internet, particularly social media, the transaction is less clear on the surface. 

The hint is in the ads.

The vast majority of adverts on web-sites are automatically selected and placed in a process known as programmatic advertising.  This process is the result of data being collected on every person who accesses the internet.  That data is being collected in exchange for the ubiquitous convenience of what is accessible over the internet.  Seemingly for free. 

But that data is extremely valuable.  When and where one access the internet is recorded.  What web-sites are accessed, for how long and in what sequence is recorded.  Every payment over the internet is recorded.  Every reference to a map, a restaurant review and a every search query for anything and everything is recorded. 

This data gives advertisers an immediate advantage in targeting their products and services toward consumers who are more likely than not to be interested.  Those advertisers pay the data merchants for access to that information and for the simplicity of having their ads targeted to those consumers by automated, programmatic algorithms created by the likes of Alphabet Inc.’s Google, Meta’s FaceBook and Amazon.

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Before Google, advertisers had to spend big on market research to identify where and when to purchase space for their adverts.  With programmatic advertising, that cost is nearly eliminated.  A win/win, right?

Yes, and no.

The Wisdom of Crowds

The volume of consumers accessible to advertisers over the internet is matched only by the value of the data they provide.  For many advertisers, the quality of the audience is more important than the size of that audience. 

A small number of highly affluent adult consumers is more valuable to a luxury watch brand or a private bank than a large number of teen gamers.  Long-term marketing strategy might dictate that some of those teen gamers will one day be tech billionaires or high-spending wannabes, and so why not spend a small programmatic ad budget on gamer Discord channels.  But successful commercial brands inevitably advertise where the money is.

That money is not watching Tik Tok videos.  Rather, that money is producing Tik Tok videos.  That money is generating money from the very data-rich consumer behaviour that makes Google such a valuable company. 

For professional investors, smart money begets profits. 

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That smart money is building a new generation of marketing agencies able to direct the world’s largest brands to the consumers they want most.  Smart money is reclaiming the business of journalism that once built some of the world’s most influential and lucrative corporate conglomerates.  That smart money knows that advertising is not dead, and that it can and will continue to fuel the Information Age that is rapidly transforming the consumer economy into a creator economy. 

Professional investors eventually recognise smart money even when smart writers don’t. 

Perhaps it is poetic justice that those same writers that prophesised the end of digital publishers now face the rise of generative AI and the very real prospects of being unemployed. 

Something for them to write about.


  1. California is poised to enact legislation that basically forces Google to fund a subsidy to local newsrooms that have been dependent on Google for so long. Interesting that those same newsrooms fired their ad sales staff once they realised that Google did all the work. Now they complain that Google keeps most of the money.

  2. Love the reporter as a clown! Also the comment that many of those publishers scored an “own goal”.

    In several articles about BuzzFeed News, over-hiring, over-spending and Managment enthusiasm for AI generated content were emphasised as causes for its demise.

    If these numbers are right, and adspend is really on the rise (rather than the predicted fall), then there is definitely an anomaly in the reporting. I also see the correlation between what was reported and what investors believe (at least superficially).

    Interesting take aways.

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