Imagine a restaurant where dinner was free. That’s right, free. You and your significant other are invited to this four star establishment to enjoy a five-course meal served by a world-renowned chef. This restaurant is in a great location and is always booked on weekends. So there must be a catch here, right? Well, sort of. At the time of your reservation, the hostess will ask you a few basic demographic and income questions to determine if you are eligible for a reservation. The reason that your dinner is free is that a generous group of service providers has offered to pick up your tab in exchange for the opportunity to pitch their services to you while you are enjoying your meal. This might include financial advisors, accountants, lawyers, bankers, travel agents, and real estate agents. So, how many of you are still interested in this “free” dinner? If you think this concept is crazy, just take a look at the world around you; this is where it is heading.
Advertising has no longer become a medium that is subtly intertwined with content; instead it has become an incessant intrusive force that has invaded all facets of our lives. There are several reasons for this proliferation, but one of the main factors is the increasing number of businesses who have developed an advertising based business model in lieu of charging for their product or service. I have even heard rumblings that Microsoft is thinking about launching an advertised based version of its popular Office suite.
When I was a child, my father always told me that nothing was in life was free. Then how could he explain free PC’s, free ISP’s, and free e-mail? But then I remember the other half of that saying; it is simply a matter of who is paying. So who is paying for all these free services that are so common now a days? The answer is YOU. You are paying with your privacy. Modern day marketing has invaded our personal lives. Virtually any service/product can be offered for free, so long as the consumer is willing to sacrifice a little personal information and/or privacy, but is this trend really in the best interest of consumers? What if you have trouble with one of your advertising based services? Don’t expect to get satisfactory customer service, because you aren’t paying for the service, the advertisers are. They are the real customers.
Another particularly disturbing trend is the increase in the number of web sites that offer visitors an opportunity to disclose private and demographic information about themselves to marketers in exchange for cash or e-currency. These sites are the Internet equivalent of the T.V. talk show, where guests discuss their darkest secrets on national television in exchange for a free trip to New York. In exchange for a few dollars, these sites make it easy to log on and enter personal and demographic information, which is sent to direct marketing companies who will recoup this cost by selling your information or profile to its advertisers. Is selling your privacy really worth a few dollars? I keep coming back to the story I read about a women who had a miscarriage, but continued to receive marketing information about diapers, bottles, cribs and other baby products, because at one time she had registered her information on a baby oriented web site. Somehow, her information had been passed around a community of web sites that marketed baby oriented products and services and it got to the point where she could not stop the information from being sent to her.
This adverting phenomenon is not limited to the Internet. Television, the original model of adverting in exchange for a free service, is now in fierce competition with leading Internet sites for advertising dollars. As a result of this competition, the major networks are spending big bucks to retain their top programs and the rights to the most popular sporting events. I have to say, that it has reached the point where I cannot even bear to watch a National League Football game anymore. Every time anyone does anything with the ball, there is another commercial because CBS needs to recoup its investment. In fact, if you attend any of these games, you will be shocked to see the players continually standing on the field hanging out while all of the commercials run and CBS pays their bills. It has become so unbearable that I think I would pay $1000 to watch an entire season of football without commercials. If I got my brother and father interested, it might be closer to $2000. Anyone interested in pursuing this business? If just 100,000 other people feel the same way, this is a $200M dollar business for the taking.
If I find a service or product with significant value and a high degree of service, I am more than happy to pay for it and be spared the advertising. If Yahoo asked my to pay $19.95 a month for MyYahoo page, I would not even think twice, because it has become an integral part of my daily routine and works 99.9% of the time. One of the main problems for advertisers with this current trend is that it’s not sustainable, the more people are exposed to advertising the more they will become desensitized. This is a vicious circle because it will then drive the value of advertising down and make companies have to reexamine the financial viability of an advertising based model. Many businesses have already identified this problem and have chosen to focus their marketing efforts on non-traditional channels such as customer referrals.
The next time I want to take my wife out to diner, I will look for a place that allows us to enjoy some privacy. Oh, and when the bill comes, I will be more than happy to pay for it myself with my American Express Card. Damn, they got me too.