Executive Creative Director for Modem Media Chris Clarke explains why rising advertising sales do not mean that those involved in the industry can rest on their laurels.

NMK: Is internet advertising in period of boom or bust? What I mean is that while revenues are reported to be soaring, there's an increasing feeling that people aren't paying attention any more.

Chris Clarke: Well, it really depends what you mean by advertising. It's estimated that the average consumer is exposed to 3000 advertising messages a day. Of course they aren't going to pay attention to all of them. And of course they are rejecting that as their fate. People have TiVos for their television and ad-blockers for their internet browsers.

So advertising can no longer be the evil, blundering behemoth it once was. You can't just shout and expect people to listen. We're entering a time when brands have to offer a value exchange in order to have a share of consumers' mind space. You have to create experiences that consumers want to be a part of.

Advertisers often don't recognise that, though, and so banner ads and similar are the main part of internet advertising activity. I think that's a missed opportunity.

Going back to the idea that advertising is in crisis, I don't think that's entirely true, though, despite what I've said. When things become more difficult, then that's when innovation is allowed to occur. And that is happening now. To be flippant, about ten times more innovation took place during the Second World War than in the twenty years leading up to it. My point is that advertising is at war at the moment, and that's actually moving things forward for the industry.

NMK: So what might a value exchange look like?

CC: A good example might be the recent Sony Bravia ads that featured a council estate getting bombarded with colour [YouTube video here]. Sure, it's an advert, and everybody knows that, but it's also an experience that's entertaining. So people talk about it and pass it on and its impact becomes a lot greater than simply trying to sell TVs. Crucially, Sony are showing people a good time - they're giving something in order to get something back. The point is to make them smile: don't just show them pictures of other people smiling.

Another example would be a video we've recently created for HP called 'Tea Running'. There's people in the video using HP equipment and a brief message about laptops at the end. But the reason people might talk about the piece is that it involves a young man in a parcourt action sequence jumping around the office.

Enlightened brands have always thought of themselves as content creators. They tell stories about themselves. Of course, that's easier for some brands than others. If you're Nike with a 'just do it' message, then that's a bit easier to create a story around than if you're Allied Carpets.

NMK: So you're sceptical about the fortunes of traditional advertising compared to this 'viral' approach?

CC: Not at all. It all depends on the context and the sort of people you're going after. On a gadget site, for example, where there are laptop reviews, then a much more direct approach might be the best one. People there are probably looking for a good deal on their next laptop, so a traditional banner ad will have a lot more force than a video about running round the office. We still buy an awful lot of banners.

'Tea Running' for HP is much more about awareness. We were looking to find a way into SMEs. At the moment, business is the new rock 'n' roll. Our culture views entrepreneurialism as cool in a way it didn't until only a few years ago. We were aiming for some exposure among those people - something people will pass round the office and enjoy.

Another point to make is that people aren't always resistant to traditional adverts. On the one hand, there's a broad recognition that advertising is a necessity. Unless you want to pay a lot more for your media, they need to sell adverts and people need to look at them. Secondly, people like good adverts. When you go to the cinema and see a good advert, people laugh and clap.

I'd actually say that viral marketing doesn't exist. It can only be one part of the mix. Having a viral marketing agency is a bit like having an agency that only does bus shelters. It's important, but it can't really put you in a position to offer a full service for clients.

The structure of the marketplace can also make creative campaigns difficult for agencies themselves. As you know, agencies normally earn their money as a percentage of the media spend. If that means buying a million banner impressions on cnn.com, then all well and good. But with a video uploaded to YouTube, the media spend is nothing and so our percentage of that doesn't look so good either.

NMK: I have a couple of anxieties about this more creative approach. First, it's presumably pretty hard to measure the ROI, and second, it seems a little hit and miss - some adverts - like the Bravia one or the VW Transformer ads - become wildly successful, while others simply disappear into obscurity.

CC: Both of those concerns are correct, but with provisos. Yes, measurement is harder now. Videos, for example, don't just stay where you put them, but get re-uploaded to other services, so we need to keep a constant radar out for where our properties are popping up. The video files also get passed round on email which is almost impossible to keep track of. However, you also need to consider that these sorts of approaches are about branding rather than direct sales, which has always required a more qualitative approach to measurement.

Also, the YouTube demographic is quite narrow and different demographics will use different means to watch the video. Even though a piece may register low numbers of views on YouTube, the advertiser's home page might suddenly receive a huge wave of hits that indicates that it's being watched elsewhere.

NMK: You'll also be aware that there's something of a backlash against social media sites being used by advertisers...

CC: I expect there's a backlash, but it's a backlash against advertisers doing things badly. People aren't naive: they expect an element of commercialism but they also have a right to expect transparency about that. Nobody sees anything wrong with posting a commercial that makes them laugh or entertains them in another way. It's when people pretend to be something they're not that they get in trouble.

Another thing to recognise is that the internet intelligentsia has a super-low threshold of tolerance for commercial activity. So there will always be complaints. But if you do it right and get beneath that barrier, then that's very good.

Another project my company was responsible for was the developers' social network The Hive. That's owned and paid-for by Microsoft. They don't try to hide that and they don't bombard members with advertising messages either. They just tried to create a useful community for those people. Nobody minds that sort of commercialism.

A lot comes down to choosing the right place, too. We've all heard a lot about major brands buying up space in Second Life. There have been some angry reactions to that from users, because residents go along to those offices and shops and find them completely empty. Companies have entered the world without really considering the level of commitment that it will require and so they've just abandoned them. They also need to consider that the Second Life population are generally-speaking deviants, so is that really right for a high-end B2B services provider, then?

NMK: Have you come across the Attention Trust, and the idea of advertisers paying for the right to have some of our attention?

CC: Yes, and I'm very sympathetic to that. As I said before, advertisers need to approach engaging potential customers as a value exchange. The idea of selling your attention data represents one way that might take place.

I've long thought that while individuals don't have much in the way of money and resources, they do have credibility. Organisations, on the other hand, often have plenty of money and resources but little credibility. Some sort of trade seems like a reasonable proposition for all concerned.

On the other hand, I can see a couple of problems with what the Attention Trust is doing. It seems like a bit of a blunt instrument. People won't like your adverts or start to think about your brand just because you've paid them to.

Also, the Attention Trust people are, generally speaking, among the upper echelons of people who live on the internet all day. I'm not entirely convinced that it's appropriately worded or executed in a way that the mainstream are going to care about.

Join our debate about The Attention Seekers on March 6th!