SLEEPING WITH THE ENEMY: DISINTERMEDIATION IN INTERNET ADVERTISING

Abstract

The advent of internet advertising has changed the basis of the intermediary role which the advertising agency traditionally has occupied between advertisers and the media. This is disintermediation, or ‘cutting out the middle man’. The intrinsic and distinctive properties of the internet as a commercial medium, and its interactive character, have given rise to the phenomenon of search advertising, which diminishes the need for an advertising agency. This article outlines and analyses the challenge which Google and the other search services pose to advertising agencies, and the strategies which the global advertising industry has been taking up in response. In particular, evidence of Google's steps towards assuming the functions of an advertising agency, and even of a traditional advertising media owner, are canvassed, and set against an account of the global agency groups’ moves into specialist digital companies, and how they are working with the search services.