This is not intended as a defence of the quantity of advertising that you're describing, or even to say that there's not better ways that these goals might be achieved, but this in particular got me thinking of how it might fall down:
"Advertising is a zero-sum or even negative-sum game."
I think there are at least 2 things going on here.
One is that it might be helpful to draw a distinction between well-known product categories with minimum differentiation and more innovative products. In the case of laundry powder, the brands are just jostling for relative position, you're going to be buying some form of laundry powder either way, and it's just about who gets that money. That seems to fit your zero sum situation. But sometimes there are entirely new products and (at least in theory) those consumers who choose to buy them presumably do so because they think that the value they'll get from them is greater than or equal to the cost that the supplier is charging. "Ooh, that movie looks like it'll give me £20 of joy and they're only charging £10 for the cinema ticket, so I'll go." In that case the informational value of an ad for the new product is telling the consumer how they can buy something that's a net benefit.
The other thing is that even in the undifferentiated product case, the advertising is paying for branding. And (again, in theory) the branding potentially has some value to the consumers. It gives suppliers more to lose. Say that there's a way to adulterate laundry powder with something that fills the box cheaply but has the unfortunate side effect of dissolving clothes. If you're 'Anonymous White Box Laundry Inc." then you might be tempted to use this adulterant. If you get caught, you'll just start again next week as 'Anonymous Beige Box Laundry Inc.'. But if you're a big brand name laundry powder, you'll steer clear of that since the loss of future sales is far more costly than the savings from using the adulterant. To the extent that advertising builds brand awareness, it can in theory have value to consumers who can pick suppliers who have more to lose by not living up to a reputation for reasonably high quality products.
Agreed, this seems a critical flaw in the post's argument.
Ads are not always zero-sum or negative-sum games.
Intuitive example: I see an ad for a new shoe I was unaware of. It sounds interesting to me and I buy it. I like it and my life is better for having this better shoe. As a result, the world is better off: I got a better shoe that I value more than the old shoe I was wearing, holding constant that I was going to pay money for shoes and am choosing between similarly priced options.
This even holds for things I already knew about but didn't reconsider.
Intuitive example: For historical reasons I believe car X to be poor quality. I see an ad extolling the recent changes in car X to be higher quality. I do some further research and learn car X is in fact better than it used to be. So I learned something new thanks to the ad and can now make better decisions.
Ads are a way of paying to prioritize information.
the branding potentially has some value to the consumers. It gives suppliers more to lose.
Thanks for bringing this up. I wrote this post largely as a way to gather feedback on my perceptions of the role of advertising, and this is a good example of something I wouldn't have otherwise thought of.
After thinking about it a little more, though, I'm still not convinced advertising solves this problem. For example, even if no detergent brands were well-known, I would buy detergent without worrying about its quality. The store that sells it to me has its own reputation at stake. Even a store that doesn't advertise has a brand, because of its physical presence and the ability for word-of-mouth to spread in its local area.
Online, there is more reason to stick with established brands. There is less accountability for the platform that directs you to low-quality brands, and scams or low-quality products are thus more common. Trust systems like reviews try to alleviate this, but they are quite often gamed. But in a world without advertising, e-commerce platforms would still have to avoid a reputation for hosting scam or low-quality sellers. I doubt this hypothetical world would have worse product quality across the board, due to the need for platforms to protect their own reputations. (Perhaps more, because brands would have to lean more on their quality and less on their marketing to gain popularity, though I would hardly guarantee it.)
Try watching a video online without an ad blocker.
As far as I know by default an ad blocker has no effect on Amazon Prime, Netflix or Youtube if you are willing to pay for an ad-free experience.
I'm not sure what you mean here, but FWIW I use a dedicated ad-block browser app to successfully avoid Youtube adds on my Android phone as part of my ongoing personal war on ads (my previous workaround was muting the phone and physically covering the screen with my hand). I also mute my car radio whenever ads come on. I'd rather miss the first minute of the next song if that's what it takes.
I'm certain that the comment you're replying to was talking about youtube premium (formerly youtube red) on youtube - it can be a pretty good moral case to use adblocker + youtube premium because you will be compensating the creator (they actually receive more income per premium watch than regular ad revenue) and youtube without consenting to online tracking and targeted ads.
Just tax ads and use that money to bid on ad slots to not show ads.
Advertisers sound easily retrained. Entertainers have specialized skillsets and motivations, and polls would be sad to see movie/videogame investment go.
I may have been unclear in my post, because I agree with a lot of your viewpoints.
If you want to pay your sportsballers a bajillion dollars that money has to come from somewhere. In general, the market has decided that ads are the optimal way of paying for things that people don't want to pay directly for.
I dedicated only about a sentence and a half to this, because I think it deserves a separate post, but I don't want to pay my sportsballers a bajillion dollars. I view the fact that people don't want to pay for entertainment as an indictment on entertainment. Without advertising, the entertainment industry would be much smaller, but it would still be able to present high-quality products. This could mean less expensive sports leagues that don't have 30 teams and don't pay every player millions of dollars; movies without expensive special effects, expensive actors, and expensive marketing budgets; and news that doesn't pay writers that readers wouldn't pay to read.
The problem I have with the businesses would get by fine without ads is that it is demonstrably untrue. If you look up the biggest companies you will already know their names, their logos, their slogans, any music or sounds they use, etc. You buy from these companies all the time. Advertising works. Today you can quantify the effect of advertising better than ever. Anything on the internet can be tracked, and can be A/B tested.
This was poorly phrased in my post. The specific businesses in existence, specifically the biggest players in the market, stand to lose a lot without advertising. Their brands are often the source of their profitability. But I don't believe businesses as a whole would suddenly become unprofitable. The biggest shoe companies would lose some cachet and market share, but it would still be profitable to sell shoes. And while lots of shareholders have an interest in dominant brands staying dominant, I do not view it as a net loss to the economy for some companies to lose market share while others take their place.
[Crossposted from damiensnyder.com.]
Author's note: Thanks to the commenters who have pointed out some weaknesses in my argument I didn't think of. I still endorse the majority of this argument, but I don't think this was the best way to express it. (An earlier post I drafted on this same topic emphasized the time people spend on TV and the internet, and I think that thread of argument was more compelling.) I remain very frustrated by advertising: consider how many thousands of talented individuals spend their entire workday trying to get people to watch more ads, a thing no one likes to do. But where I ignore ad-free video / streaming subscription services, and to a lesser extent ad-free news, this argument is weaker. I may write another post explaining the world-model behind my view on ads in more detail. Thanks again for the feedback.
Have you noticed that everything is covered in ads?
Not everything. You can go entire days without seeing an advertisement. But you can't do that if you plan on watching TV, browsing the internet, or taking public transit. Let's review some everyday sources of entertainment, and where you can expect them to show you ads:
Ads are ingrained into every detail of the sports experience. (For non-sports fans, you will have to follow along and imagine.)
You go to the game. You might drive, and see billboards on your way. You could take a bus or train, the inside and outside of which are covered in ads and occasionally PSAs. Then you get into the stadium. If you pick up a program, it will likely have ads in it. When you get to your seat, you might see ads surrounding the stadium wherever there aren't seats. The players will walk out, and their jerseys may have ads too. (If not, they might have a sponsorship deal with the company that made their uniforms.) If you're not watching soccer, the action will be interrupted every ten minutes so they can show ads to the people watching from home. Even if the people watching from home record the game so they can fast-forward through these commercials, they will probably still see advertisements on screen during the game, and maybe have announcers read more brand taglines between their commentary. At larger breaks in the action, a lucky row could win free coupons, or a lucky fan could get the chance to win a sponsored prize. The viewers at home will get a halftime show littered with even more ads than usual. Finally, the game will end. You'll go home, walk past the same ads covering the walls, see the same ads on your trip home, and only after all that, get the sweet release from sponsors.
Streaming can offer some refuge from ads, but theaters... not so much.
To go to the movie theater, you must go through the same ads as a sports game. There might not be ads on the walls per se, but they are trying really hard to sell you concessions and tickets to other movies. The movie will start late, because they are showing you advertisements instead. Then during the movie there's a chance of product placement, ideally relating the product to a high-status character in the film.
If you stream instead, you can avoid most of the ads. Depending on the streaming service and your subscription tier, you may or may not see ads for third-party products as you browse and watch movies. You will see ads for other shows and movies regardless.
Try watching a video online without an ad blocker.
The front page of the site is covered in recommended videos, some of the recommendations paid for. You click on the one you want to watch, and you'll see another ad before the video starts. If the video's long enough, you'll see more as mid-roll ads. Depending on the channel, they might read you a custom message from their sponsors as well. The description of the video contains the same link to their sponsor, along with a link to their other revenue streams. The whole time, you will see recommended videos all along the side of your screen (or whenever you pause the video, if you're in fullscreen). Some of these are paid for, as well.
There are many formats of news, and each one is covered in advertisements.
Print media is pretty simple. They have news, and wherever there's not news, there's ads. Some sources are extra crafty, and their own content will be interspersed with sponsored content written by companies to trick you into thinking the trusted news source approves of them.
Digital media comes in a few different ways. Maybe you found the article on social media. Someone paid to show it to people in your demographic, and perhaps to show you which of your other friends looked at it too. Then you click on it, via a referral link, so the social media site knows you clicked. The news site has a tracker or several, to make sure the whole industry knows what you look at. You can read the article, but before that they'll display either a pop-up ad or a notice pleading you to subscribe. Ads are displayed between paragraphs of the content, at the bottom, and on the sidebar sandwiched between actual news articles. Depending on the site you're reading on, the article itself could be sponsored content.
TV news shows commercials. You watch news, but every ten minutes they take a break to show you things that aren't news. Sometimes they'll put ads in the corner of your screen while they talk about news. On some channels the anchors will tell you about products they happen to have heard about.
The thing to notice about ads is no one likes them.[1] No one likes them! They waste our time and attention so they can manipulate our beliefs and make us spend money. But we endure hundreds of ads every week, because that's what pays for entertainment.[2]
That's stupid. Advertising is a zero-sum or even negative-sum game. If everyone stopped advertising, and they made their ad budgets into charitable donations for entertainment, businesses wouldn't all collapse.[3] So why are we wasting our time, attention, and sanctity for nothing?
It's even worse than that. Our entertainment is tailored to be maximally palatable to advertisers. Even when individual creators follow their own values, the platforms select the most profitable. This means avoiding controversy wherever possible, targeting demographics with the biggest wallets, and stretching out what content does exist to allow the maximum possible runtime. Platforms optimize for addiction, news for sensation, and creators for bingeability.
This is how things are, but there is no reason to accept it as a fact of life. There are business models of entertainment that don't require you to consent to manipulation. This means "paying for content." Sometimes you pay for content and are still sold to advertisers. In that case, this means "paying more for content." It is often preferable to pay money rather than your soul.
However, a series of paid opt-outs will not solve advertising.[4] The entertainment industry costs billions, maybe even gazillions, of dollars to run. Opting out of advertising would make entertainment costs higher than most people are willing to pay. The second part of this puzzle is consuming less entertainment. I plan to write about that later, but first I am seeking broader feedback on this topic.
This post brought to you by Anger. Are you mad that billion-dollar corporations enrich themselves by tricking you into viewing other companies' propaganda? Try Anger. Use promo code YELLING to get Anger for 10% off and reveal which marketing campaign led you to it. And remember, your friends will think you're high-status if you buy Anger.
There are supposedly people who watch the Super Bowl for the ads, which I consider an advanced form of Stockholm syndrome. ↩︎
Sometimes you even pay to be advertised to! You pay for your sports ticket, or newspaper subscription, or magazine subscription, and you're still being advertised to. ↩︎
This might not be true, but if barrages of manipulation are the only thing keeping the economy afloat, the economy deserves to collapse. ↩︎
This is especially true considering some products exist only to sell ads. Namely billboards. If billboards offered an opt-out fee so you wouldn't have to look at them, we would rightly notice they are a racket. ↩︎