All Rights Reserved © 2000 Thomas W. Day
The dot-com revolution is dead, long live brick-and-mortar . . . or something like that. Just about every business section in the traditional news media has pronounced the Internet economy dead in the ether. Their reasoning for believing the potholes in the Information Highway are fatal flaws are as moronic you'd expect. No wonder most of us get the news we care about from any old web page that strikes a Yahoo! search's fancy.
It's true that dot-com's are dying like flies. What kind of surprise is that? Face it, the benchmarks of the "industry," like Amazon and AOL and Yahoo!, have either never produced a profitable quarter or have to do desperate stuff like shuffling paper and pencils into the capital expense column to create one shining moment of microscopic profitability. Even a math-deprived-and-impaired MBA graduate ought to expect these guys to die, eventually. And so they are.
The suddenly-realized cause for the media's wizards attention to this downsizing-to-drowning corporate activity is simple; the dot-com's are filing for bankruptcy and even a major media hack can identify that as a bad thing. Now, the NBC, Fox, ESPN, and Wall Street drones are trying to convince us that they knew this was going to happen, all along. Yeah, sure they did. And I guess all those "the Internet is the mall of the future" glossy magazine hype articles from just a year back were urban legends?
Inside all of the worthless drivel, is a speck of truth that these guys would rather the rest of us didn't examine. "The rest of us," meaning consumers and those few corporate types who actually care about making their companies profitable and efficient. But be honest, being unprofitable isn't something that will automatically remove a company from the stock market's good graces. The last time General Motors showed a net profit was when Henry Ford was still convinced that anyone who didn't want to buy a black Model T didn't really need a car. IBM has to design special software, software that ignores negative numbers, to produce a decent financial quarter. And Chrysler? Don't get me started on Chrysler.
One of the great marketing hopes for most of the dying dot-com's was that selling advertising space would make the sites profitable. Somehow, marketing wisdom has, now, decided that advertising on web sites doesn't work. Nobody pays attention to web page ads, they tell us. Once the boys with the really big advertising budgets made that decision, cyberspace became worthless and what little cash flow some of these companies produced vanished in a puff of business logic.
OK, I won't argue that I don't pay any attention to ads on my Yahoo! page or anywhere else. Somewhere out there, I have a Rat's Eye page on Geocities that I haven't updated for a year or so, because I hate their obnoxious pop-up ads. But let's keep this ball rolling. I don't pay attention to any advertising that I don't actually seek out myself. If I'm hungry, an ad for a fast-food hamburger might catch my attention. If I'm sixteen hours into a dreary cross-country road trip to or from Kansas, a Super Eight Motel "turn left on exit 512" billboard is practically a homecoming welcome. Sometimes I open a motorcycle magazine, specially seeking the best price on tires or fringy thingamabobs that stream from my handlebars and make me look like I'm going fast when there's a decent headwind to buck. Ok, that last part's a lie, but I can see it happening in another couple of decades.
That's it for marketing's effect on my buying decisions, though. For me, uninvited advertising is simply an opportunity for a bathroom break or wasted space in my magazines or newspapers. Commercials on television are official notices that it's safe to make a three minute run to the family library or that I have just enough time to microwave a bag of popcorn before something more-or-less watchable returns to the tube. It's remotely possible that a spot for a movie might remind me to ask for a personal review from one of the life's-options-deprived folks I know who go to every movie, regardless of subject or possible entertainment value. At the absolute best (from a sponsor's perspective), a commercial break will trigger a spontaneous whacking of my remote control's channel buttons, where I'll be subjected to 2 seconds of the commercials on all of the available channels until the first station returns to a movie I've already seen twelve times or a women's basketball game, which will hold me over until what I want to watch returns from the dead.
There is absolutely no chance that an advertisement for a vehicle, clothing, tampons, soap, household appliance, drugs, insurance, stock brokerage, boxed set of disco's greatest hits, or web site will have even the slightest influence on my personal actions. None. Not one.
In fact, I go out of my way to avoid companies that have irritated me with their commercials. All of those companies who think I'm a captured audience for their advertisements during the breaks in movie theater previews are on my hated-corporate-entity list. For instance, I'd go naked through an entire Minnesota winter before I'd buy a sweatshirt from that nasty looking witch at Old Navy. I'd rather eat rabbit droppings than taste Mentos. Otherwise, I buy from whatever store happens to be selling what I want to buy for the least money in the closest proximity to where I live at the moment I decide to burn discretionary income.
Advertising has such little impact on what I consume that the chances are a company might be more likely to attract my attention if I've never heard of them. I love stuff that's boxed or canned and labeled with those simple blue stripes. The plainer the label the better. The next best thing is an obscure brand. If I've never heard of a company or it's product, I know they're not wasting a significant portion of the product's overhead expense on stupid advertisements and brain-dead marketing drones.
It's also possible that I missed their ads, when I was in the bathroom or making popcorn while their stupid advertisements were showing. And that's something that is guaranteed to happen when the ads were shown during the Superbowl, all TV broadcasted movies, or . . . any time what I'm wanting to be watching is being interrupted by a $#%&@)* (that's an expletive-deleted for you who are too young to remember the days of self-censorship) commercial.
Back to the topic of dying on the vine dot-coms, if Wall Street has figured out how ineffective dot-com advertising is, why haven't they figured out how ineffective almost all advertising is? Probably because most of the so-called marketing gurus are New York residents. Since that city's economy is spectacularly fragile and it's relationship to what goes on in the rest of the country is as functional as a House of Representatives debate, it's a matter of self-preservation. If marketing drivel bit the dust, so would that unlivable city's fifteen decades of fame.
So what the investment pros have decided is that advertising doesn't work on web sites, but they've conveniently ignored the fact that it hardly ever works anywhere. If that understanding spreads to business in general, it's possible that the dot-com's will have actually accomplished the business revolution that they made claim to twelve months ago.