New digital businesses, old advertising habits

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I have nothing against advertisements. They make it more affordable for us to watch “Monday Night Football” and read The New York Times. I love a well-made tearful TV commercial.

What I don’t like is young companies getting addicted to advertising – to the detriment of us and maybe theirs too.

DoorDash started this week giving more prominence to restaurants that pay for their listings to appear when people search for pizza or tacos. Its competitors Uber Eats and Grubhub offer similar ads. Instacart, a grocery delivery startup, is expanding its paid product placements. Even Amazon is giving up more and more retail properties to merchants who pay to yell their dog beds at us.

At their best, ads can help us find something we didn’t know we wanted and save us money. (Coupons are also advertising.) The trick is to strike the right balance between serving the companies that pay the bill for advertising and the interests of those of us on the receiving end.

I fear that more companies have turned from an advertising fair trade to a bargain from the devil. Companies like DoorDash, Instacart, and Amazon are risking our experience of browsing and buying online miserable by cramming more, and often irrelevant, ads. And let’s face it, it’s inconvenient to see a burger restaurant in a prime location on Uber Eats, not because the food is good, but because it pays for the privilege of showing up there.

Companies that have taken to advertising as an afterthought rely on advertising for two reasons: peer pressure and to overcome the financial shortcomings of app-based delivery services.

I am sympathetic. It is a difficult business to send couriers to restaurants or supermarkets and then to your door. I understand why Instacart is taking money from Altoids to be the first product listed in the snack section of the app. I understand why Altoids is willing to pay to stand out.

And conventional supermarkets have been doing that for a long time. Those chips at the end of the aisle may have paid the store to be there.

We still don’t have to be happy about anchoring some useless marketing into a new generation of shopping that promised to get better. And whether it’s a brick and mortar store or an app, there’s something perverse about browsing the aisles while the company makes money by sending us to one brand of toothpaste over another.

Jason Goldberg, Chief Commerce Strategy Officer at the advertising agency Publicis Communications, told me that digital advertising had become a race to the bottom.

Three companies that are essential portals for online information – Google, Facebook and Amazon – have all slowly increased the button for ads. They release more screen space to links, posts, or products from companies that pay to put them in front of our eyes, and less to the information the companies determine is most relevant to us.

This steady shift from more advertising online and in conventional media like TV has forced everyone to do the same, Goldberg said.

The best defense of what companies like DoorDash, Instacart, and Amazon are doing is that ads can make convenience services more affordable. Instacart’s boss has said advertising helps lower grocery delivery prices. DoorDash can charge most restaurants with lower commissions and offer paid promotions for those who are willing to pay for them.

Now I’ll be my usual grumbling freak: If delivery apps or other convenience services we love are to be subsidized by ads we hate, then maybe those convenience services don’t make any financial sense?

Sridhar Ramaswamy, a former Google executive in charge of the advertising arm, described advertising as a “stress valve” for companies feeling financial strain. “It feels like free money,” he told me.

Ramaswamy quit Google and started an ad-free digital search company called Neeva that makes money from subscriptions from people who pay for the service. I don’t know if Neeva will succeed. But we should be happy that more companies are trying to break bad advertising habits.

  • Is Instagram Bad For Kids? It’s complicated. My colleague Jessica Grose dives into some of the research on whether social media use makes teenage girls feel worse about themselves, and offers tips for parents. Farhad Manjoo of New York Times Opinion takes us through a brief history of moral panics about video games, sexting and urban gangs, saying that exaggerated fears can distract us from underlying problems.

  • OK, *who* makes a living online? Axios asks an important question: Is the creative economy of people doing what they love on YouTube, Twitch, or Substack more democratic than the old entertainment and media industries? Or only 1 percent of the stars earn a good life, while everyone else is looking for peanuts?

  • How Slack is changing office work: The Atlantic has been reading a lot about ways Slack and similar office worker chat apps are blurring the line between work and home and giving employees the opportunity to challenge their bosses. We’re still figuring out how technologies like these affect the way people interact with each other.

Alyssa Barry makes compelling TikTok videos about life at her Florida animal shelter. This is Wilbur the pig who helps Barry with the morning rounds. (I first read about this TikTok account from my colleague Julia Jacobs.)

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