“If you have a milkshake and I have a milkshake, and I have a straw,” snarls Plainview, “my straw reaches across the room and starts to drink your milkshake. I drink your milkshake. I drink it up!”

OPINION

Richard Pook

Co-founder youdooh

In the 2007 film There Will be Blood, the dishevelled capitalist Daniel Plainview (played impeccably by Daniel Day-Lewis) gloats in his victory over his competitor Eli Sunday.

“If you have a milkshake and I have a milkshake, and I have a straw,” snarls Plainview, “my straw reaches across the room and starts to drink your milkshake. I drink your milkshake. I drink it up!”

You’d be hard-pressed to find a better cinematic metaphor of how ruthless capitalism can be, with cut-throat competitors in a bitter fight over finite resources

The ad industry may or may not have its merciless oil baron, but we are witnessing in real time the advertising milkshake being siphoned off by competitors with better and longer straws than even Daniel Plainview could have imagined.

Ad-supported media was a stable business to be in for a long time. The advertising milkshake represented about 1 per cent of NZ GDP, with established local companies all taking their sustainable sip.

There was enough going around for television, newspaper, radio, magazine and outdoor

organisations to build strong local businesses that employed thousands of people throughout the country.

But in 20 short years, we have seen the impact of a powerful straw guzzling down an increasingly large share.

Recent figures show that Google, Meta and Amazon ads now account for around 50% of the global advertising market. When you isolate the burgeoning digital advertising sector (which today makes up the biggest segment in overall advertising spend), that market share balloons to 65%.

Much like Eli Sunday in There Will be Blood, governments and local media businesses haven’t been entirely sure how to respond. The loud slurp of big tech hoovering up their milkshake has happened so fast, right under their noses.

One thing that has become clear is that doing nothing will not end well for them.

This is part of the reason we’ve seen media companies and governments working together more closely in recent years to develop a framework for how the local ecosystems can continue to thrive in the coming decades.

Much of this work is being done at a legislative level and will take time to come to fruition and have the desired effect. If you are a local media business, waiting around for things to happen is not a good strategy when the advertising world is changing so quickly.

Change and disruption present opportunities to innovate and take advantage of new tools and technology.

Part of the reason why Google and Meta have been so effective is because they have enabled businesses of every shape and size to post advertising and content quickly and easily on media channels that reach huge audiences. Businesses have responded by taking some of their ad-buying in-house to manage this aspect of their advertising independently.

Businesses both large and small have enjoyed this flexibility and they aren’t going to want to go back to the way things were before - there’s no putting the genie back in the bottle .

One area that these global tech giants have not yet infiltrated is outdoor advertising. The number of digital screens has surged in recent years, with thousands of billboards, street and retail-based digital screens now available for advertising.

At Youdooh, we’ve made all these screens accessible in one place to any business owner who has a credit card and an idea for an advertising campaign. In our own small way, we see this as an important fight against the dominance of Google, Meta and the rest of the global tech platforms.

We’re essentially adding a new straw to the milkshake, in a bid to keep a bit more ad spend in the local market.

This won’t halt the global trends completely, but it will help to give NZ businesses another tool to support local, with the added benefit that all the revenue and tax will remain in the NZ market.

The giant straw of multi-national big tech isn’t going away anytime soon, but every bit of innovation from local players will also help to make a difference. Local media working together with technology is really where the opportunity lies to fight back.