The basic premise of this book:
- digital advertising markets are like financial markets
- since advertising is way overpriced there will be a bust soon
- the bust will bring the internet down because that’s how the internet is financed
Well I don’t buy it.
For a start, Direct Marketers *do* know the value of what they’re buying. Their advertising sends people to dedicated landing pages where they can be tracked through the site and measured if they convert. Thats getting harder to do, but despite whatever amount of fraud or manipulation may be going on in the ad space, it’s still roughly possible.
Direct Marketers these days are not just web shop owners but many other kinds of data-driven business. I’ve personally run profitable websites with digital ads as the exclusive source of customers. And don't tell me that Booking.com (one of Google's biggest advertisers) or others like them don’t have a very detailed idea of what their advertising is achieving.
Then there are indeed Brand Advertisers. Mostly, they don’t have more than a vague idea what they get from their advertising, and nor have they ever. They pay way above the worth because they can’t deduce the proper value. There’s the biggest problem in advertising, but it’s not a new one and if this book had asked the more fundamental question, “does brand advertising even work?”, it could have made more of a contribution.
Oh, and it’s a mistake to conflate display advertising with search advertising. It’s faulty reasoning to criticise display advertising by showing a problem with search advertising (page 79) and then to rubbish search advertising by picking only search BRAND advertising, a small and special case.
For sure there are things that need to be fixed in the digital advertising arena. Right now there are major government investigations into Facebook and Google and if there is anything to be done about their monopolies (there is) then the internet will stumble on somehow and businesses will continue to advertise, as they must, in whatever outlets bring them the eyeballs they seek.
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![Subprime Attention Crisis: Advertising and the Time Bomb at the Heart of the Internet (FSG Originals x Logic) by [Tim Hwang]](https://m.media-amazon.com/images/I/51OSSjyWSVL._SY346_.jpg)
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Top reviews from the United States
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Reviewed in the United States on July 23, 2021
Reviewed in the United States on April 5, 2022
Reviewed in the United States on December 20, 2020
Reviewed in the United States on March 10, 2022
Reviewed in the United States on December 14, 2020
Reviewed in the United States on December 15, 2020
Reviewed in the United States on August 1, 2022
Top reviews from other countries
~James~
Reads like a Dominic Cummings blog post
Reviewed in the United Kingdom on November 17, 2020
G.C.
Online advertising technology issues primer
Reviewed in the United Kingdom on November 6, 2022
G.C.
Reviewed in the United Kingdom on November 6, 2022
About Tim Hwang
Hwang is a lawyer working for email newsletter platform Substack. Prior to this he worked in a US think tank attached to Georgetown University: Center for Security and Emerging Technology and in public policy at Google focused on machine learning. So he brings a deep set of knowledge to writing Subprime attention crisis. One also has to bear in mind that his current employee Substack is based on the online media model moving from online advertising driven to subscription driven.
Timing is everything
I read this book over a couple of days at the beginning of this month. By this time, Meta and Alphabet has published quarterly results that were below what investors expected with falling sales.
On the other hand, one could also argue that much of the crisis had already landed. Ad tech businesses like Rubicon Project have either gone under or merged with their peers creating a massive amount of consolidation. The latest wave of consolidation happened in 2020 – 2021.
Hwang in Subprime attention crisis points out many of the things that agency employees and owners have known for years:
Online advertising effectiveness has declined compared to its performance 25 years ago
Audiences don’t see a lot of the ads that are displayed. Different reports will give you different numbers on this
Online advertising is destroying the very media industry that its content is shown on
Online advertising fraud is a big problem
Online advertising business practices are an even bigger problem with up to 70 percent of of online programmatic advertising spend going to advertising technology intermediaries such as The Rubicon Project (now Magnite) and Xaxis
This has allowed businesses like Procter & Gamble and adidas to reduce advertising spend at no loss in effectiveness. In the case of P&G Subprime attention crisis highlights how they cut $200 million in online advertising spend, moved that spend on to offline media like radio and print AND managed to increase their reach by 10 percent.
One of the most notable things for me was being introduced to the work of Australian based academic Nico Neumann who has done some great research on online advertising effectiveness related areas including Frontiers: How Effective Is Third-Party Consumer Profiling? Evidence from Field Studies.
So nothing surprising for insiders, but….
Hwang marshals his facts well. Which is what you would expect from a lawyer. He uses analogous examples from the US financial services sector including the 2008 financial crisis. The book itself is 141 pages in length and there is a substantial section detailing his sources. Subprime attention crisis is based exclusively on desk research.
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Jonathan Briggs
Excellent and highly readable
Reviewed in the United Kingdom on December 26, 2020Amazon Customer
Reads like a poorly researched blog post
Reviewed in the United Kingdom on July 6, 2021Mamun
Thought provoking paralelism between subprime financial crisis and online ad industry
Reviewed in Spain on June 13, 2021
