Why content sites are getting ripped off

A commenter on my blog the other day (Tim Ogilvie) mentioned a distinction that I found really interesting between intent generation and intent harvesting.  This distinction is critical for understanding how internet advertising works and why it is broken.  It also helps explain why sites like the newspapers, blogs, and social networks are getting unfairly low advertising revenues.

Today’s link economy is built around purchasing intent harvesting.  (Worse still, it’s all based on last click intent harvesting- but that is for another blog post).  Most of this happens on search engines or through affiliate programs.  Almost no one decides which products to buy based on Google searches or affiliate referrers.  They decide based on content sites – Gizmodo, New York Times, Twitter, etc.  Those sites generate intent, which is the most important part of creating purchasing intent, which is directly correlated to high advertising revenues.

But content sites have no way to track their role in generating purchasing intent.  Often intent generation doesn’t involve a single trackable click.  Even if there were some direct way to measure intent generation, doing so would be seen by many today as a blurring of the the advertising/editorial line.  So content sites are left only with impression-based display ads, haggling over CPMs without a meaningful measurement of their impact on generating purchasing intent.

All of this has caused a massive shift in revenues from the top to the bottom of the purchasing funnel – from intent generators to intent harvesters.  Somehow this needs to get fixed.

3 thoughts on “Why content sites are getting ripped off

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