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When Mad Men Meets Flash Boys
Advertising used to be simple business. My newspaper has a million readers. My TV program has a million viewers. Now let’s negotiate what it’s worth to you Mr. Brand to put your ad in front of my audience. The web made this dynamic a bit more complicated, but early on the process was quite similar. My website gets a million hits per month and now let’s figure out what a banner ad is worth to you. The story got more complicated rather quickly as a bunch of genius coders realized that advertising is actually the perfect domain for technology because tech is capable of bringing way more measurement and accountability than ad buyers had ever seen before. It’s not a coincidence that all of those high flying tech stocks you follow are really advertising companies – think Google, Facebook, Twitter, Yahoo, Baidu. Online advertising is a $100 billion global market, or about 10x larger than it was in the early 2000s. This segment has risen from nowhere to become second only to television advertising but growing much more quickly.