The Future of Advertising

will be back next time. Yep. So we had to sit down, Joe and I sit down and decide what were are you going to talk about in the future, Like what what is the episode that we're going to look at and say, how is the Oh I'm sorry, wait, I'm being told I have to take a break right now. We got a little quick commercial. Do we need to throw too? Uh? And we'll be right back. No, I'm just kidding. Actually, we're gonna talk about the future of advertising.

You know, I would like to talk about the future of advertising, but I am just sitting here stunned by the crisp, refreshing taste of coke. You know, As I was putting on my levies this morning and uh then slipping on a pair of Converse to make the long walk here, I was thinking advertising doesn't affect me. It's true, you know, though, Jonathan, when you make that long walk over to the office out in that hot sun, you really should stop and get a nice crisp bottle of

De Sauny brand water. I'm glad you're sticking with the Coke brandst water for your lungs. Actually, you know, you know, for my lungs. If I'm gonna breathe in water, might as well make it do SAUNI right, Uh, you know, I will say this, here's a free plug. There is one one location I do legitimately have to force myself to walk past on my walk home, King of Pops, because the actual King of Pops office is on my way home, and you can buy King of Pops popsicles there.

If you're not familiar. King of Pops is a quite popular popsicle stand in Atlanta. They got nice little carts wheel things around. They've got handmade popsicles that are delicious, and they did not pay us to say that. No. They also have a couple of locations like North Carolina and a couple of other places too. Yeah, they're they're phenomenal.

So yeah, if you're ever in the city, guys and you you want to come visit how stuff works offices, we'd love to have you come by and see it, and then maybe we'll go and grab a King of pops popsicle. Yeah, they've what have they got. I'm not really a popsicle kind of guy, but Sea Salts they're big. One. The one I had was like a Chai tea popsicle. That's really good. They also have sweet tea and lemonade that's really good. That's strawberry margherita. We've you know, that's

quite good. You know, we're advertising like crazy. Apparently the future of advertising is the show. Well, yeah, we should go ask them for money now, all right, Well that's probably not how it works, and no, no, it's not

how it works. But we wanted to talk about the future of advertising because this is one of those things that has become it's especially here in the United States, has become something that's really integrated into multiple parts of our lives, sometimes intrusively, where attention is brought to it and there's a negative reaction. Sometimes it's worked in two ways so subtle that you might not even be consciously

aware of it. And where are we going from here? Yeah, okay, So let's start with what I would state as sort of the fundamental conflict of the nature of advertising today, which is that everybody knows what ads are. I mean,

it's not a secret anymore. You're you're aware of the fact that businesses want you to be one aware of their products and services, to to have positive impressions of their products and services, and three to have sort of like drive or motivation to go out and spend your dollars on what they have to sell, right, whether it is to do it immediately or whenever you are in mind of pursuing that particular type of goods or service, right, So, yeah, they might be wanting to make you go out and

buy it right now, or just kind of plant a seed in your brain so that so that it will sprout into a tree of money dollars later exactly. But so there's a sort of conflict here, which is that ads are the financial fuel that makes free content possible. I mean, so by free I mean stuff like TV shows and uh, and open web content like websites that you use that you don't have to pay to access, or podcasts, yeah, podcasts, anything like that. Without ads, these

things wouldn't exist. There would be no way to pay the people who make them. They'd have to get jobs

doing something else. It's just you know, you'd probably the only free content would be I guess what people just make in their spare time as hobbies, right, it would be It would be things that people are so passionate about that they are paying for the ability to put it out there for other people to enjoy and there and ultimately in the grand scheme of things, that is unsupportable because only a very few people would ever be able to do that on an extended basis. Right, So

ads make open content possible. But at the same time, most people don't really want to watch ads. They might not have a really strong aversion, but they just they just rather spend their time doing something else. Well, they might want to continue the content that they're already pursuing, Like, uh, if you're if you're reading an article in a magazine and you turn the page and it's an AD, and you realize you have to go to the next page to to continue the article. That can be frustrating if

you're watching a television show. Heck, TV shows are designed so that the moment just before the ad break is essentially like a mini cliffhanger. In most cases, they have to try to keep you on the hook to make sure that you don't change the channel, right, ads are on right, you have to stay there through the ad break so that when it comes back, you're still there. So that's an incentive for you to stay. And I mean it actually in that case, In that way, ads

are directly affecting the style of the content. The con has been uh shaped partially because of advertisements, and uh, you know, it's it's it's one of those things where I know, like people who get DVRs or people who wait until a series is available on DVD or on Netflix or something like that, one of the things they talk about really enjoying is the ability to view these

series without the interruption of ads. And that's a problem. Yeah, And and that also highlights how you know, of course, there are other models for how content can be paid for. You can pay to view it or pay to own it like you would with like a movie or something. So that doesn't mean all movies are necessarily add free. Sometimes they want to supplement their budget by placing a few products in there or something. Sometimes it's subtle, and

sometimes it's incredibly blatant. Right, um, But so yeah, ads make the content that we like and consume possible, and we generally put up with it. I mean, I don't get mad when an ad pre rolls before a YouTube video, but a lot of times I will switch over to another tab while that ads running, or I'll or I'll wait till a little skip thing pops up and I'll

skip it. Yeah. Yeah, I've done the same. I mean there's some However, there are times where I've gone to a uh YouTube channel, for example, something that I really enjoy, and I think, no, I'm letting this ad play out because I legitimately like what this person is producing and I want to create the incentive for them to produce more,

want them to get that cents. Yeah, and knowing that in the grand scheme of things, my one view is insignificant, but I hope that other people are doing the same so that the person who's making the stuff I enjoy continues to have a reason to make the stuff I enjoy. So and that's that's what we wanted to make clear from the get go. Joe and I both are not anti advertisement. We think that ads provide a valuable service

for multiple reasons. One, I mean, there are products I would never have been aware of had there not been ads for them, products that I use all the time, like stuff I buy regularly, and and the reason why I know about them is because I heard an AD or I saw an AD, and that that has led to a benefit to me personally. So there's a benefit. I work in an industry where we have we work on the web. We wouldn't have jobs without we wouldn't have jobs without ads, So I benefit from that way

as well. So uh, and then you know, the advertisers benefit if if in fact their ads are effective, because they can move whatever the product is. So we're not anti ad, we're anti bad advertisement, right, We're anti intrusive advertisement that ends up being speak for yourself, intrusive things.

So when you go to a website and you have an auto play video pop up over on top of whatever it is you're trying to want, when it starts making sound, and it starts making sound, is the worst feeling when you've got thirty six tabs open and one of them starts making sound, You're like, which one right, yeah, because you're you know, sometimes when we're researching these podcasts will be we'll be looking at multiple resources and sometimes it will be some media coverage of a story, and

you know, you know, you guys know you've been to media sites. There are a lot of media sites out there. When you open it up, it has a typed article as well as an embedded video, and there are some more than a few media outlets out there that have those set not a play And then you open up all these stabs and like you were saying, Joe, one of them starts playing like oh't know, and then you have to play hunt the video. When I'm out competing

in a triathlonshing taste of Coca Cola. This is where we point out we live in Atlanta, where you know, if we don't mention coca cola and every few podcasts we get punished. So anyway, uh, yeah, it's this is that's a that's an extreme example, right of a terrible advertisement that that is more than more than uh not

going to irritate the person rather than entice them. Uh, I mean you're you're guaranteed to get a lot more views that way, but that doesn't mean the views are valuable, right, And so there's always this give and take in how you design ads and what you do with them. I mean, you're you're trying to manage the audience's reaction, manage how many audience members are going to see it, how they feel about it when they see it. And then you're also competing with the fact that most of us don't

really want to watch ads. We're not going to go out of our way to watch ads. So you know, how do you make sure that you're still getting exposure to especially to the right kind of audience, the people that you think would buy your product, and you want to see these ads. So there's this back and forth going on all the time. People are savvy about like when commercials are going to come on on the TV.

They've come up with devices like TVO and stuff to skip over them, or they you know, or they just wait until they can they can watch it, I don't know, pirated or either DVD or something like or something. Yeah. Yeah. Likewise, there are a lot of people who work on the web, programming, advertising, and they're starting to notice, Oh, a lot of people just don't click on display ads. You know, you can run ads on the side of a website and and and and the you know runners on the top or

bottom of a page, that kind of stuff. Sure, and there are a lot of people who are afraid, like, oh, well I can I can put that there. But people just know that they've started to learn where those things are going to be on the site, and they just they automatically tune it out. They don't pay attention to add blindness. Yeah, yeah, you just you don't even bother looking at the banners or the sides or anything. And that's why you see these different kinds of ads emerging.

Like in the past years, we've seen the the YouTube pre roll ads come in as a thing when they say, well, somebody wants to watch a video, they've got to watch the ad before the video starts, or all kinds of other things that are part of the science of advertising people trying to figure out how to get you to pay attention. And then there are the piece is of content that are designed so it looks like it's you know, uh of a YouTube video or TV episode or whatever,

but turns out to be just an ad. Uh. If that's not done very very well, then very likely you end up getting a very negative reaction from that because people feel like they've been tricked into watching a commercial and people don't like that. I mean that no one likes to be tricked right there, Like, just be just be upfront about it, because unless it's unless it's a

pleasant surprise, then it ends up just being irritating. And there are ways where you can create a compelling, uh interesting AD that is in fact its own kind of content. I'll give you an example, uh, even though it's an AD for something that no longer exists. Pt the playable

trailer that was released on PlayStation four. It was a playable trail alert that was ultimately discovered to be an AD for Silent Hills, the game that Giamma del Toro was working on before that whole thing got mixed, and that did have kind of an advantage going in of like a built in audience that was the fans of the previous games. But but when it first came out, the most of the people who were playing it weren't even aware that it was itself an ad a trailer.

It was it was its own experience, and then at the end it turned out to be a trailer, and it was one of those experiences that told you this was really creepy and really effective, and if this is an example of the sort of stuff that's going to come out with this other game, I can't wait for this other game to come out. So that was an amazing example of an AD that was designed in such a way to not look like an AD and yet was effective. Most of the time, that doesn't happen most

of the time. If an AD is designed to look like something else, people end up getting ticked off that they were quote unquote tricked into watching an AD. So that's certainly something to be careful of. One of the things I think we'll definitely see in the future. Uh, that's something that I think we're gonna see more of.

We're already seeing it now, is more targeted advertising. Yeah, So this is one other way that ads have advanced recently that they've started to say, hey, we can figure out data about who's going to be looking somewhere at any given time and give them ads that we think would be especially effective on them. So one way you'll probably notice this is the ads that show up for you on Facebook. Right, if you use Facebook, you are getting targeted ads that are based on who you are.

There's somebody out there with an algorithm who says people who have your interests, who are of your you know, like age, uh, sex, you know region, all these different facts about you. They think I can decide exactly what this person needs to see. Now, sometimes it it's weird and it doesn't make sense. Yeah, I I've I've received ads for things it I'm like, who did they think I am? I remember that I used to get this

one all the time. It was just a picture of a gun and it said like join swat, Like they were trying to get me to enlist in some kind of police academy to become a member of a swat team. I'm not sure what that was about. In my case, it was a photoshopped image of an insanely muscular body builder. And I've gotten that. Yeah, that's the That's a popular one that pops up on mine. And I'm like, have I ever done anything that tells you I'm remotely interested

in lifting anything heavy? Like I usually look for excuses like I think, you know what if I just aim for Downhill, It'll take care of it itself. Like, I mean, I can see the appeal of lifting a heavy plate of nachos. Yeah, that's about it. I'm with you. I'm

with you on that one, Joe. So, targeted advertising obviously is very attractive to advertisers because it gives at least the potential for a greater return you're going to see if you are if you are setting out to engage an audience that you have predetermined is more disposed to purchasing those types of goods and services than you have

a better chance of success as a consumer. Assuming the targeted advertising is working properly, it can work to your favor as well, because you will end up seeing things that would be pertinent to you. Sure, I mean, if targeted advertising works as it's intended, it actually should work out for you really because it should be showing you things that you actually want to buy, right Like, it should be able to figure out what you're willing to spend money on and would feel good about doing so,

right and right now. I would say that targeted advertising is in it's in a transitional period. So if you look at traditional advertising with magazines, radio, television, Uh, the advertisers would again look at the demographics of the audience for that particular channel or or you know, television series or radio program or whatever it was. And of course

we're all individuals. We know that's kind of a crude metric, but maybe it was better than nothing, right, And so it was in a way, even then, it was still targeted advertising. It's just it was kind of the you know, net approach as opposed to a very refined like targeted approach. Uh. And then with the period we're in now, we're looking still at demographics, but we're looking at narrower slices of demographics.

And then in the future, we're expecting to see a lot of personalized advertising where it's going to be based specifically on you and your likes and dislikes and behavior, something more akin to the Facebook thing you're talking about, or on Amazon where you get the suggested items because

of your previous buying habit. It shows you stuff you've looked at but not bought on Amazon, so it's like, hey, remember this thing you were thinking about buying or still there, or shows you related objects to the thing, like you know, you bought this one thing. Other people who bought that one thing, also these other things? Are you sure you

don't want these other things too? Of course, the kink in that system is if you're like me and most of the stuff you look at on Amazon is just looking at because it's funny, not stuff because you're playing.

But like the products that have the ridiculously funny Amazon reviews written for him, Yeah, I love those, Like you find some ridiculous item on Amazon and people will people really take it as as as their their attempt to exercise their poetic license and create the most amazing reviews ever. But yeah, more targeted ads and personalized ads are probably

in the future now. Granted, we've already seen examples of companies doing this and having missteps right where they've identified people and revealed that the behaviors of that person were more revealing about their personal situations than you might otherwise have anticipated. So, in other words, like your actions have told this company things about you that might not be tied directly to your identity, but tied directly to your personal situation. And that's an example. Okay, so here's the

classic one. I won't name the company because I mean it's been talked about a billion times anyway, But there was an instant instance where you have a company that identified that a particular customer, based upon behaviors, was pregnant and sent coupons to that customer, uh, electronic coupons to

that customer that had to do with pregnancy. The father of this customer, who was a young lady I was offended that these these coupons were insinuating this daughter was pregnant, and so he wrote and complained to the company saying, you know, how dare you do this? Uh, you're you're casting aspersions upon my young daughter. And then of course it turned out that in fact his young daughter was pregnant but had not yet told her father, and so

us led to a very difficult situation for that family. Certainly, I mean that was well, this kind of means how targeted advertising, if not done right, could be a violation of the users privacy. Right, Yeah, And and it's it wasn't the intent of the company to do such a thing, you know. The intent of the company was, here's an opportunity to to make some more sales. This is a question on new life. Well, and this was a person who was clearly interested in it because her browsing habits

had indicated that. So it's not like they were making just a shot in the dark, right That this was someone who was actively looking for information and the company was responding to it in a way that they thought was being proactive and it turned out to be overreaching. But it does definitely illustrate that there are ways of doing this that can be if at best problematic and

at worst disastrous. Yeah, and so I think we can both agree that targeted advertising is going to get more and more were targeted, It's going to get just basically because the systems that surround us throughout our lives are going to know more and more about us and understand what to make of more and more that data all the time. So what does the future of targeted advertising look like? Well, the future could be integrated directly to

our day to day experiences. The Wall Street Journal had an article about how mass marketing was dying, it was going extinct, and the idea was more about this targeted and personalized advertising, which wasn't necessarily just personalized to to you Joe. You know what makes Joe Joe. We're going to send ads to Joe, but more, but more about what Joe is specifically doing at that time. Right, So it's not even just you, it's you in this moment. Right.

So the examples that they gave, here's a good one that that was in the article. Uh, let's say you're driving down the road and you're starting to get to a point where Okay, you are driving down Beuford Highway. You just got some delicious Korean tacos. Okay, so you you're driving down Beufford Highway, got some delicious Korean tacos. You're heading back to the east side of town, which

is where you live. Uh, Beufford Highways of course in the northeast, So you're gonna have to go southwest to hit the perimeter, take that around, unless you're gonna go all the way down into town and then take twenty out.

But we're not gonna bother what the details there. At any rate, you're taking the road, your gas your gas is getting down to like, oh, let's say it's a less than a quarter of a tank, and your your card detects that the gases at this level and sends a message to you saying, hey, you probably want to refill your gas before you drive, because there's gonna be some traffic. You don't know how long it's gonna you're

gonna be stuck there. You should probably refill. There's a gas station, uh half a mile up on the right side that would be really useful to you. Now it may be that the reason you hear about that specific gas station is because that gas station is an advertiser that has worked along with the system that is integrated into your car, so that you get the alert for

that specific gas station. There might be another gas station that's on the left that would be fine too, but you have the specific indication that there's one coming up on the right, so you can go and refill. And that's a moment of opportunity that could be uh, could be exploited or uh, you know, cashed in on however you want to think about it, but ultimately it's something that you would need to do anyway. Yeah, that's interesting.

Or another one that seems quite possible is we've talked before about the possibility of something like a smart fridge. So imagine a future where all the products you buy at the grocery store, all the refrigerated ones at least, are r f i D tagged, so that when you put them in the fridge, the fridge recognizes like, oh, I just got a you know, gallon of milk on this day, at this time, and it went into fridge. Now, imagine you're at the store and you can't remember if

you have fresh milk in the fridge or not. Your fridge could send you an alert on your phone saying like, well, the last time you put milk in the fridge was a gallon forty seven days ago, probably not fresh. You might you might need more milk. I don't think I've ever had a gallon of milk lass that long. Joe, Well, I don't want to know what you do with that milk. But anyway, sip at a gallon, just like like just milk and hang it from one finger, take a sip

every now and then. Yeah. Anyway, uh so, Yeah, that would be useful information when you're at the store. But what if you couple that with some kind of like advertisers supported network. Obviously, advertisers would want to be able to say, Oh, this person is at the store and they know they need milk, why don't you get this

brand of milk? Yeah, And it could even be that you get home and you know you you're you could at proactive messages saying all right, you, you've bought these four items several times in the past, and they are now currently running low, they're almost out, or they're almost expired or whatever. Here are some coupons for those items. Because we know that you bought them in the past, you'll probably buy them in the future. This is another incentive for you to do so, and you go out

and you buy them again. It's kind of like kind of like the same sort of benefits you would get from being a getting a customer loyalty card something along those lines. The stuff that's being integrated into digital wallets, it's very much the same sort of strategies. The idea of, well, we we have established these particular customer behaviors, let's reinforce those behaviors and continue to sell the goods and services

that these companies are providing. And if everything is done well, then it benefits everybody, right, because the customer is happy, because the customer has the opportunities to buy the things that he or she needs. The advertisers are happy because the client are selling the stuff they want to sell, and so therefore the clients are happy. Too. That's the ideal situation. Uh, it won't always work out that way.

What if you go out and you buy something. You know you've got a recipe and it's calling for something that you normally don't buy, but you go out and you buy it, you put in the fridge, the fridge recognizes you've bought that thing, and then you're just constantly getting messages to buy more of that. And it turns out the recipe didn't work out, it was a disaster,

and you're never going to use that again. That could be that could be an annoyance, right, so hopefully you would have I mean, it's not going to ruin your life, but it could be. It could be mildly annoying. Would be like spam. It would be essentially the equivalent of spam, saying well, I'm not going to buy that, and yet I keep getting messages about that's spam. So hopefully there would be a means of building things into their saying, all right, this one thing I bought was a total mistake.

I never want to buy it again. Don't send me messages about it. Uh, there would hopefully be some sort of way of building that in. Now, granted that would probably receive some resistance from the side of advertisers, but ultimately it might be the best thing to provide to make consumers more ready to adopt that kind of approach, right, because I mean, I would hate to think, Oh, I you know, like, for example, I do not enjoy I

don't tend to drink a lot of soft drinks. I very occasionally do, and so I wouldn't tend to buy them. You drink gallons of milk instead, not all at once? Are you? How is a gallon of milk last forty seven days? For you? Joe? To me just a hypothetical example, I've ever bought a gallon of milk? Good Lord, I can go through a gallon of milk in like four days. Um, but I drink almond milk now, so I don't drink

milk milk anymore, but at any rate. Uh. So, let's say let's say that I buy um soft drinks for a party, because I'm going to have a party. Uh. First of all, the soft drink is gonna set in my fridge forever because no one ever comes to my parties. But but you know, if I kept getting messages about buying soft drinks, that would be irritating to me. So that's definitely something that needs to be worked out as well. Otherwise we fall into the same traps that we fall

in with traditional advertising, or maybe not traditional but web advertising. Um. But the whole reason for this is because the traditional approaches, while they could get in front of a lot of people, you couldn't really be sure how effective. They were. So if I put an ad a national spot at uh in a show that has a pretty high ratings, so it's a show that a lot of people are watching.

If you buy a super Bowl commercial, that's the ultimate example here in the United States, right buy because I mean well, super Bowl commercials are almost their own thing because there's like a there's like a perceived competition to create the most entertaining super Bowl comment. Never mind you you you take out a spot to run a commercial on a rerun of Friends, there we go. That's that's a good example. You know there's gonna be people watching,

you know, it's it's one of those things. It's gonna be a lot of folks, a lot of eyeballs on that screen. So you know that you're going to reach potentially a large audience, But you don't know how many of those you're going to engage with that commercial, Like, you don't know how many people are really going to be paying attention, who are going to be affected by it,

who are going to act upon it. So ultimately, you're the value of your commercial is largely placed upon the value of the show you've put it against um, unless you happen to create one of those rare commercials where people talk about it later and there's a buzz about it, in which case you know, you're like, excellent, that's the dream right there, to have a commercial that gets legs beyond when you air it and then like it has an appeal of its own, Yeah, and hopefully it translates

into more sales. I mean, obviously, if you're an advertiser and you're not in your ads are not translating into sales, you're not going to be in business us forever because clients are gonna say, well, we're gonna go with someone else because we're not We're not actually seeing an improvement

here in our our sales figures. So I think of like commercials that got buzz or or seemed to get a positive response, uh, the one that that springs to mind in among my circle of friends were the series of old spice commercials because it was just so weird and had a very quirky sense of humor which was so different from everything else that was out there at the time. And um, I don't know how it translated into sales, but it certainly was one of those things

that people found entertaining all on its own. So that's mass marketing and the approach. But if you look at the web version, you can see how effective those ads are because you see how many people click on stuff.

Right if people are not clicking click through rage, Yeah, click through is valuable in the sense that, yes, it shows how valuable advertising is, but it's also incredibly destructive because it also shows how valuable advertising is, which means that if the advertising isn't valuable, then the whole model falls through, right, Like, how do you justify uh, getting advertising dollars spent on a on a on a particular show if the ads aren't driving people to actually purchase things?

And this was this is one of those things we've seen Teeter Totter throughout the history of the web, right, Like, we saw some web pages because the traffic that they were getting were commanding incredibly high advertising rates to run an add on those pages. Uh, and then others were having very low rates for theirs. So you can have the same ad running on two different websites and have it being having a much larger payout for one versus

the other just because of the traffic. Yeah. And then of course there there are other metrics that are much much harder to measure or maybe even impossible to measure with how successful something like a piece of web advertising could be. Because you might have a successful piece of web advertising that people don't click on. Instead, it's successful because it creates a positive impression or a positive association. In fact, I think a whole lot of advertising works

this way. Like you're not even um, it's not that people are saying, Oh, I need to buy some deodorant right now, I'll click on this ad. Instead, they see an ad for your brand of deodorant on a site they really like, and they form a positive association in their mind, and then then maybe in the future when they're going to go buy something in the store, they have that nice feeling about your brandy and that you know,

that's a long game to play. The problem from the the the financial side is it's very hard to to create the causal relationship. How do you figure out if that's working. Yeah, so if you can't be certain that it's working, then it's hard to put a value on that advertisement. You know, it's it's hard to get to that point where you say, how much is the opportunity or our our service to be shown on your service? How how valuable is that? And it's really hard to

answer that question. You would think it would be easier with web based advertising them in mass marketing, because again, you can at least see engagement in web. Now, there might be a spike in sales after a television spot runs on a popular program like let's let's go back to the super Bowl, because that is the big example in the United States. Let's say there's an incredible commercial for some product out there that just really captures imaginations

and then you see a spike in sales. It's, you know, somewhat logical to to draw a line from one to the other, but it may be there are other factors that were at play and that the causation is not as direct as it appears. Right, So you can't be sure even in that traditional world that the ads are what led to the increase in sales, and in our current world, you can't be sure. So then that starts bringing up the question of well, how do we figure

out how valuable this is? Like, how do how do we get to a fair point where the amount that is paid by the advertiser to the service makes sense and allows the the service to or like you know, the content creator however you want to put it, allows them to actually create the stuff they want to create. Well, I've got a few scenarios I'd like to talk about that might be part of the future of advertising. So the first one I want to bring up is, so

we've talked about add subsidized content. You know that there's content that you can view for free or at a reduced price because it has been totally or partially paid for by ad dollars. What about add subsidized hardware. This is something I think we've seen come up with a few devices. So I think the one of those, some of the kindles, had this option, And I think this is very interesting. I don't know if it is the future, but I can very much see a scenario where it is.

So here's the way it works. You can pay, and I'll just make some numbers up. Let's say there's a new device, it's like augmented reality glasses or something like that, where you can pay five hundred dollars to get just standard model, or you can pay two hundred dollars to get a version of this that every now and then shows you ads. That's pretty much it. So it's not just subsidizing content, it's paying for part of the hardware

that you want to own but might be expensive. And I think that's an interesting model and we might see more of that going forward. But that leads into another thing I want to talk about, which is the possibility of augmented reality advertising. Right. So that's get like virtual ads overlaid on top of real physical things, right. Yeah, So think about the cool things that we've talked about

that something like the Microsoft Hollow lens can do. One thing you could supposedly do with the hollow lens is it's pair glasses you put over your eyes and you you see everything normally. It's you know, it's like transparent so you can see your surroundings. It's it's not like virtual reality goggles where everything's virtual. The solid display is transparent, right, so it's transparent. You see your surroundings, but you can

put digital content anywhere you want in your surroundings. So the cool thing about the hollow lens is, let's say maybe you can put a screen anywhere. So you want to watch TV, you don't have to look at a TV. You can say, well, I want to pin a screen playing a video to this wall, and so you can go about your business, but they're on that wall there. Through your glasses, you will perceive a screen playing your video.

So every time you look at that wall, you'll see the screen, and if you look away, the screen in your perspective stays there. Yeah, and I think that that's really cool. Yeah, it's super cool. I really like that as a potential application. But you could also think about ads working that way. And I don't want to sound really creepy about it, though it might be creepy depending

on on how it works out. So imagine you're wearing your augmented reality glasses while you're out on a hike in the mountains, and you've paid for this ad subsidized model, so you paid less to buy the glasses, but you're gonna see some ads. What might you see out on a hike. Well, it might be that you're walking through the woods and some tree stumps have ads for hiking

boots or for camping gear. Now, obviously, like a national park would never allow people to pin up advertisements all over the You wouldn't have billboards everywhere, but you could digitally create a forest with ads pinned up all over. I'm just imagining like the comedy spoof version of this, where you're wearing the hollow lens you're out there. I obviously not the hollow lens that's meant for inside the house, but a hallid I'm talking, but I mean a future

augmented reality. Right, You're you're wearing some some augmented reality headset or contact lenses or whatever it may be, and you're out there hiking. I could just imagine seeing the ad cold. Have you tried fire fire now for like and of course yeah, and it's of course you can imagine this not just hiking, but in any scenario. The software and hardware together are smart enough to sense things you might want to buy or be thinking about in

your current situation. It can serve you, serve you ads for those super personalized like let's say again, Let's say that I'm wearing these augmented reality things, whatever they may be, and I'm walking around a city, and the device knows that I've not spent very much time in this city. It knows because of the fact that I've worn it for a while and that most of my time was spend in Atlanta. That's where my home is. It knows that because of just tracking my my location. But you're

visiting the loss to the Atlantis. I'm I'm visiting the lost city of Atlantis. Now. It also knows because I have often gone to taco joints that I like tacos. And so I'm walking down or rather swimming down the avenue in Atlantis, and I'm looking around at various buildings and one of them happens to have a takaria in it, and it pops up tells me, Hey, you want those Baja fish tacos, this is the place to go. Uh.

That would be very valuable to me. I would. I would very much like to that, especially if it was telling me, all right, well, here's the place, here are the top reviews for that place, here's the menu for that place. And it could all be that it's an opt in advertising thing. Um. And you know the other thing I like about this is that with augmented reality, it's it's very easy to get away from all the advertising.

You just take the augmented reality headset off, right, and then you're not surrounded by I mean, you're surrounded by ads, but you're surrounded by classic ads, right. So what I was just talking about part of I was thinking about when I was imagining the scenario was like, wait, why are you wearing the glasses in the woods anyway? Shouldn't

you be out enjoying nature. Well, you want to augment nature so you enjoy it more, right, Well, you might actually want to augment nature because you there might be cool apps that you could run in your glasses. So maybe you're out hiking and you want to be able to have like a compass app in your vision or like a maps app in your vision, or maybe you want to identify a bird you saw, Like you see a bird and you're like, I don't recognize that, and be able to use image recognition to say, hey, this

is the bird. Yeah, Or maybe you want to look at maybe it'll identify constellations in the sky while you're out how hiking at night. Sure, so yeah, I can see scenarios where that could be cool. Though I hope at some point you take the glasses off and just

experience some unfiltered planet Earth. And also I hope that in all of those experiences any sort of advertising is not intrusive, because obviously that would severely impact your enjoyment of the experience, right and need Again, just like every other type of advertising, it needs to be smart in order for it to work. Sure, but yeah, the thing you suggested I think is a is a less creepy and and maybe better version of that, where it's just

for things around you that it thinks you would probably want. Yeah, I mean, you know, you could get to a point where you even have uh, let's say that you've got the glasses on in your home, like the Hallo lends again great example, because that's designed to be in your home and you're looking around and you happen to look down at something that you know you doesn't work anymore, but you haven't gone around to throwing it out, and it identifies it and knows it doesn't work, and since

you like, do you want to replace this that actually can identify when something's broken, Well, there can be because I'm like, let's, for example, I have a puppy, I know, and the puppy is adorable and I love him very much, but the puppy sometimes gets into things. Oh, this was going to such a scary place. I thought you were going to say, if my puppy is broken. Now, I'm not talking about my puppy being broken. Don't go there.

I can't even I can't even bear that thought. I'm talking about my puppy like doing something that my puppy did. This is actually what my puppy did, chew through a power chord to a to a cradle that holds my universal remote. My universal remote does not take normal batteries. It has a like a proprietary battery inside of it that charges through these little contacts that are inside a

charging cradle. So unless I buy a new charging cradle for this universal remote, which by this time has been kind of become obsolete, right, I mean, I could probably find one somewhere. But you know, let's say that I'm wearing the Hollands and I look around and it says, oh, well, clearly this isn't working anymore because the cable's broken. So here here's a link to a new one. You can

buy it right away. That because I'm one of those people who, unless it's right in front of me, right at that moment, I might not even think about it. So the times when I'm actually engaged in shopping, I might not be thinking about the stuff that. Oh yeah, I guess I could stand to buy another one of those. So how will the company that sells the replacement parts teach dogs how to chew through cables and we'll sell

more stuff. However they've done it, it has really stuck with my dog, and my dog is is an ACE student and could probably teach other dogs his technique. Okay, I want to talk about one more potential future advertising technology that could go to both good and horrible places. Okay, yeah, yeah, there's a particular science fiction series that you're going to refer to us. I'll start with the horrible and then we can imagine the hopefully more likely and better version.

And this is eye tracking. So if you have seen the UK TV series Black Mirror, I'm sure you'll remember a terrifying, terrifying episode about people who live in a world where almost every social activity they do is digital. It's all done through puters like everything is. It's sort of like this dystopia of the social media future. Wait, well, whoa, whoa, whoa. I think you met Utopia. Everyone seems pretty darn happy in that series. Yeah, yeah, it's it's terrifying. It's horrific.

And so they're they're yeah, they're they're going through all these social apps to do everything. But of course every digital experience comes packaged with ads, and when an ad comes up, they've got a system of sort of money that's build as credits, and you must either watch the ad or pay a fine. That's scary enough on its own, I don't think hopefully, I don't think people would put up with the system like that, but we'd see. And then here's the worst part. You can't just let the

ad run and ignore it. You have to watch because the screen knows if your eyes are closed or averted. There's eye tracking technology there, so if if you look, and your room is essentially all four walls are screens, so if you look from one wall to the other wall, the ad follows you. So it's not like you can look away from the ad. The ads still playing, still playing right in front of you. And if you close

your eyes. It detects that you're closing your eyes and it will just pause the ad until you open your eyes again. Yeah. Now, like I said, hopefully, I don't I don't think this kind of thing will ever happen because it is just so awful. I don't think people would put up with it. That's my optimistic take on this. I'm sure they're cynics and pessimistic people who say, no, we're going down that road. There's no way it would work. No one would buy anything from any company that did that.

So unless we hope not, unless you were a company buying ad spots for your uh competitors, so that you that you sour everybody on their stuff, it just wouldn't happen. So I'm gonna hopefully say I don't think people would tolerate this kind of world. But on the technical side, this is not hard to imagine at all. In fact, I think we have the technology to build this today. Yeah, we have softwye tracking software exists. Yeah, we They used to be that they would have specialized cameras to do

eye checking. Nowadays you just need software and and typically a standard webcam or even laptop camera can do this. Sort of stuff where it can track where your eyes are uh directing, you know, where where you're you're directing your gaze. So let's say that you've got an AD, you might use that sort of software to see, well, where are people looking when this ad pops up? Is it compelling? Are they looking away? If they're looking away?

Can we design an AD that makes people want to watch if they are watching a particular thing in the ad? Can we create another ad that takes advantage of that.

You know, maybe maybe there's a particular beauty shot of a product and people are really gravitating towards that, and you think, well, maybe we need to focus the product more in our ad and less about the idyllic experience your life will have if you buy said product, right, because a lot of the ads focus on you know, things like family, you know, a family hanging out and being happy or whatever, and you don't see what the product is until towards the end of the commercial, And

really what they're selling is the idea of happiness. Oh man, I don't know if you saw the same ad I did before mad Max Fury Road, did you? I don't know. I was in the theater to watch mad Max Fury Road. And there was a commercial that played before the movie came on, and it was exactly like you're describing that. It didn't identify what the product was and I'm not going to say the brand particularly, but it was like it wasn't coke, wasn't because we didn't talk about know.

It was it was like this, this family doing all these things outside, had nothing to do with any product to that you could identify, like a whole family and they're like on a farm outdoors doing various activities. And then at the end it just showed the brand name and it was a brand of yogurt, had nothing to do with No one is ever eating yogurt in the ad. No, And everyone in the audience just immediately started laughing. It was,

I would say, not a successful act. Well, and it's one of those things that advertisers are trying to do right there, trying to associate a brand with a particular type of a set of feelings. Right It's almost like you're selling happiness as opposed to selling a product. Sure, and I think ads have always done that, but this is this is an example of doing it the wrong way. Egregious example. So you know, you might you might end up creating an AD and using eye tracking software to

see you know. And I could see this being more about the testing of the ads before they go out to the public. Not necessarily some of that's rolled out because none of us want to have a world where when we are online, our cameras are always active to track our eyes. We don't want that world. That's not any place we want to But assuming that's something where they're testing the ad, you know, they're bringing people into look at different ads and see which ones are more effective. It's,

you know, essentially the focus group type stuff. Eye tracking might be very useful to see, like, oh, well, maybe we need to reshoot this AD and focus on this one thing because that's what everyone seems to really be looking at or they're looking at it, and this thing has nothing to do with the stuff we're selling, and therefore this is a distraction. We need to eliminate that distraction.

Those could be examples. Then again, I can see, on the other hand, this might be another scenario where that subsidized hardware comes in. You know, what if it what if people accept something that tracks where their eyes are looking because they can get the device a lot cheaper if they agree to that. Well, I mean if they're doing it, because that's all on the up and up. You know, it's right there in the front saying this is the reason this isn't expensive. And uh, I mean personally,

I would never do it. I can't imagine. I don't think i'd even buy a device that show in me ads because it was cheaper. I now see, I could see myself doing that depending upon the device, because it would depend on how badly I wanted the device. Uh So, for example, for something like an e reader, like it's for me. Any reader is one of those things that I do like enjoy using them. Uh and uh, I

think they are valuable. But if I'm looking at one that's fifty dollars as opposed to one that's two d and fifty dollars, and the fifty dollar one is because it has some ads in it, I might think, you know, I really like e readers, but I don't know if I like them two fifty dollars much. I guess I'd want to know how where the ads show up, how often, how intrusive they are. I mean, is it going to be like every time you flip the page you're gonna

have to flip past an ad. For me, it would be, are are the ads working with whatever it is you're reading, Because if you're reading something like The Road, is it all like like like like the the filter masks for when you're dusting in your house or I saw any water or you know, that would be awkward, right like, depending upon what you're reading, like you're reading Game of Thrones, it would just be it would just be uh, wedding cakes and uh and various types of razors like yeah,

I mean that comedy aside. I mean, obviously there are are again things that you've gotta actually dedicate thought too.

We've I'm sure all of us have had a story where we've been in an experience where an unfortunate ad has has thrown a moment into the wrong kind of tone, Like you know, it's the end of a show, end of an end of an act on a on a television show where something really dramatic happens, and then the next ad is so totally different that it has created a moment of absurdity that makes it hard for you

to get back into the show. We've had those examples. Heck, the Super Bowl This past year is a great example. There were so many heavy, heavy commercials. I didn't watch it, but I remember people talking about, yeah, like ads that, oh wait, did I watch it? I think maybe I saw part of it. I wasn't really anyway that the whole thing was. I remember people talking about ads that

were like your children are going to die. Yeah. No. There were a lot of very heavy ads, and particularly heavy ads about like that that dealt with with some sort of tragic event and then the healing after that tragic event was part of what the ad was selling. And there were so many that people were like, this is the most depressing super Bowl in history because the ads are so dark and depressing and they're very The few that were fun and and peppy and whatever, we're

so uh, you know, seemed out of place. Yeah. It just was weird, right, And so that's one of those things again. It's it's you know, it's a it's a difficult thing, like how do you design an ad that's going to be powerful and compelling and get people to do what you want them to do, but not again disrupt the entire experience. So, uh, we'll probably see more

work in that area as well. I think I think the interesting thing to me about advertising is how it's the the way we experience the world around us is evolving so quickly that there's a there are a lot of questions that are unanswered, and so things that might have worked back in the good old days, the mad men days, uh those that those rules don't apply anymore, or at least not to the same extent that they

once did. So it's it's an interesting world and I'm I am curious to see where this goes, both as a consumer and as someone who creates stuff like it matters to me. Um, I'm not you know, I'm not planning on advertising any of the stuff I do, apart from you know, the kind of promotion I do on social media or whatever. But but the other two areas where the you know, the person who's creating content that is ad supported and the person who consumes content very

much matter to me. So this was fun to talk about, and I know this was one of our more rambily episodes because we were, you know, wanting to to focus on something that we're interested in and also concerned about because we want to make sure that when it's done,

it's done correctly. I'm curious to hear what your thoughts are, listeners, If you have any perspective on ads, maybe you work in advertising, maybe you've got, you know, a deeper sense of perspective from that side than we do, which would be great to hear from you. If that's the case, send us an email our addresses FW Thinking at how Stuff Works dot com, or you can drop us a line on Twitter or Google Plus or Facebook. At Twitter and Google Plus, we are f W Thinking. Just search

f W Thinking in the Facebook search bar. We'll pop right up and you can leave us a message there. We read all of them, and we we love hearing from you guys, and we will talk to you again really soon. For more on this topic in the future of technology, visit forward thinking dot com, brought to you by Toyota. Let's Go Places,