'Frenemies' is Ken Auletta's brightly readable tour of today's ad business
New Yorker writer Auletta takes his readers deep inside the conference calls and boardrooms of the professionals on the front lines of the industry's internet transformation.
“If you can't figure out what a website is selling,” goes one of the fundamental axioms of the Internet age, “the website is selling you.” It's a comment on the currency of data, a wordier, nerdier update of the old advertising world maxim, “If you're not at the table, you're on the menu.”
Something of that predatory tone is right there in the title of Ken Auletta's new book Frenemies: The Epic Disruption of the Ad Business (and Everything Else), a brightly readable, cinematic tour through the seismic changes currently altering the face and the very nature of the marketing and advertising professions. In that new world, enormous companies like Google and Facebook are “frenemies,” willing to work in rough concert with each other but always poised and ready to cut each other out in the ruthless environment of putting ads in front of people.
That environment has changed fundamentally from its purported golden age, recently commemorated by the hit TV show "Mad Men" (tedious references to the show are now ironclad inevitable in books about the ad business – thankfully, Auletta restricts himself to a mere few hundred such references). For years, the mechanism was simple and ineffective. Advertisers hired ad agencies to promote their wares in the few venues where they knew they could reach potential buyers: magazines, newspapers, one of the three television networks. There was no real way for advertisers to know how many people were actually seeing these ads, and the ads themselves were easily avoided.
Fast-forward to 2018, and the picture changes radically. The Internet connects billions of people with each other and, potentially, advertisers with all of them. Very nearly every one of Earth's adult humans possesses a cellphone; Facebook has 2 billion active users; Google performs 3.5 billion searches every single day; apps like Snapchat and Instagram are ubiquitous; services like Airbnb and Uber are fixtures of modern life around the world. “As for Amazon,” Auletta writes, “since it is the world's largest store and knows what individuals have actually purchased, its data is unrivaled.”
Non-stop interactive traffic generates towering mountains of personal data about the people engaged in it – names, addresses, preferences, disposable income, even daily routines – which in turn makes it possible for advertisers to know with alarming accuracy who might buy their products, and when, and where, and why. As one ad agency member puts it in the book: “We know what you want even before you know you want it.”
All this represents a bonanza for advertising; 130 billion ad pages are displayed on the Internet every day. Eighty-seven percent of Google's $79.4 billion 2016 revenues were supported by advertising. With Facebook and Snapchat, it's over 95 percent. But the “big data” fueling those companies can often be harvested, analyzed, and employed by the companies themselves, which puts traditional advertising agencies on very precarious footing. While the personal information of consumers is more thoroughly known and disseminated than ever before in history, those consumers also have some unprecedented controls over their exposure to even the best-targeted advertising.
Impatient and media-savvy millennials have easy access to the kind of ad-blocking services that are the worst nightmare of the business. Imagine tuning in on a Friday evening in 1967 to watch "Star Trek" and simply being able to skip the network commercials. It was two decades and entirely new technology before die-hard Trekkies could do that, but millennials have been doing it their whole adult lives. This places extraordinary new challenges in the path of advertisers. “Today, the consumer is in control, and increasingly the challenge for advertisers is to create experiences that people will want to have because they will no longer have to have them,” Auletta writes.
As he did in previous popular books like "Three Blind Mice" and "Googled," Auletta takes his readers deep inside the conference calls and boardrooms of the professionals on the front lines of the industry's transformation, from heads of traditional ad agencies to media agency sharks to Michael Kassan, the head of MediaLink, a powerful media representation company with its thumb on the scale of a great many new deals in the industry. Auletta is a beloved profile-writer for the New Yorker, so all these wheeling and dealing men and women come alive like characters in a novel. (We meet Les Moonves, CEO of CBS, with “arms folded across a blue pin-striped suit as he relaxed in the ornate, spacious thirty-fifth floor Black Rock office that was once founder William Paley's”). By now, Auletta has this formula down to a science, although in a book as data-heavy as "Frenemies" the formula sometimes feels like a distraction from the main subject; less color and more data might have been the wiser course for this kind of topic.
But "Frenemies" is nevertheless the most vivid account to date of what may be the most crucial moment in advertising history – the moment when data went from servant to master.