The Hidden Persuaders of the Smartphone Era
In the TV series “Mad Men,” the fictional agency’s creative director, Don Draper, would sometimes jot down an idea for an ad on a paper napkin, while relaxing in a bar after work. In the following few days, the agency’s art department would turn the idea into an appealing advertisement, which the public would later see in the media. This “scattergun” approach was based on the statistically proven idea that if a lot of people saw or heard the message many would act on it.
“Mad Men” was set in the 1960s, and the advertising methods used then may not sound very sophisticated by today’s standards, yet scientific techniques were employed even then. For important campaigns, agencies, advertisers, and specialist consultants would carry out research of target markets using focus groups and psychological analysis. The kind of targeting of ads to niche groups or individuals, as happens today, however, was inconceivable in those earlier days simply because it was not possible. Now advertising agencies use data brokers, social media data, and psychometric specialists to micro-target consumers, making those old advertising methods seem quaint and even innocent. They were certainly much less cost-effective. Yet both eras have a common factor: the use of professional organizations that employ every available device to convince consumers to act in ways that benefit an advertiser.
Today, though traditional media still exist, the advertising industry is driven primarily by the Internet, and customer data is collected and monetized by big tech companies like Facebook, Google, Microsoft, Apple, Amazon and others. They gather a huge amount of psychographic and demographic information about all their users. That enables advertisers to target potential customers extremely precisely. For most products and services, online advertising is much more cost-effective than traditional media advertising, though the information about consumers collected online by the tech companies through social media and other means enables advertisers to better target their tradition media advertising also.
For example, if an advertiser wants to sell a product or service to single male fitness enthusiasts aged between 35 and 45 earning over $80,000 p.a. and living in the Pittsburgh area, the Internet companies can aim advertising specifically at people fitting that profile with a very high degree of accuracy. The Internet companies may not reveal those individuals’ identities to advertisers, yet the advertisers’ targeting is accurate because it is based on very large samples of data amassed from the profiles, friends, and online activities of those users. That is why most of the advertising that we all see online is for products and services relevant to us.
To protect consumers, traditional advertising has always been regulated, and the regulations have become tighter with time. So claims in ads must be accurate and provable. Traditional media advertising is relatively easy to monitor because the same advertisement is seen or heard by many people. In addition, regulations don’t just apply to the advertiser; they apply also to the medium that publishes the advertisements such as newspapers, TV, radio, and cinema.
Consumers are much less protected on the Internet, however, especially on social media platforms because current regulations don’t apply to most online content. In addition, the social media companies claim not to be publishers, merely platforms that have little or no control over what users post on them. The problem of potential regulation is exacerbated by the sheer amount of advertising and other content on social media networks, the huge number of users, and also the fact that so much of the advertising is micro-targeted and seen only by a relatively small group of users.
Currently, the social media platforms give unscrupulous people an almost foolproof way to spread misleading and false information. That might not be too serious, if it only meant, for example, that some people purchased a pair of shoes that didn’t live up to the seller’s online claims. If, however, false or misleading claims in unregulated and anonymous online advertisements induced a person to vote for a particular candidate instead of another in an election, it could threaten democracy.
In the 20th century authoritarian and fascist regimes undermined democracy in some European countries. That is why Europeans today are so wary of any hint of such threats reappearing and partly explains why the EU has introduced new regulations to protect users’ online data and privacy. In force from the 23rd of May, 2018, the EU General Data Protection Regulation (GDPR) is expected to prompt similar regulation in other parts of the world, especially in the US and Canada.
“The Hidden Persuaders” was a hugely successful book published in 1957 about the US advertising industry of that era. The author, Vance Packard, suggested advertising was an immoral industry that used hidden psychological tricks to entice people to act in ways they otherwise might not have. Today’s hidden persuaders are much better hidden and much more persuasive, and, crucially, much less regulated, at least for now.
Make no mistake, governments around the world will introduce and pass laws governing search and display in the coming years. The big companies will suffer as a result and the door will be left wide open for companies like Yippy, inc. to capitalize. We expect the new Yippy Search engine to be released in the second half of 2018. The engine will be ad-free, will store zero data and deliver results 23X faster than Google. And best of all, your search results will be relevant! Yippy trades on the OTC US under the trading symbol: $YIPI (IBM owns 9% and GlobalStar 18% of the outstanding shares). Yippy shares will breakout to the upside in a big way, only a matter of time.
The IBR Team