What is it about the advertising business that makes otherwise sensible businesspeople think it’s the panacea for all their ills? This week, as The Wall Street Journal recounted today, DoorDash launched its ad sales effort, following on the heels of similar moves by Instacart and Uber. All three apparently see advertising as the way to turn their low-margin businesses into something decently profitable. All we can say is: Good luck!
These companies are jumping into advertising as media firms, part of an industry built on advertising, are trying to reduce their reliance on it. BuzzFeed, for instance, talks up the promise of newer businesses such as commerce. Most of the rest of the news media has made subscriptions their priority for making money. And it’s not just the news media going in that direction. We noted earlier this year that ad veteran Marissa Mayer’s new startup, Sunshine Contact, was planning to charge a subscription rather than rely on advertising, reflecting a shift away from that revenue source among some Silicon Valley firms. The ad-market dominance of Google, Facebook and Amazon has made advertising less appealing for everyone else.
