Why advertisers are obsessing about the ‘interest graph’

George Orwell once observed that watching an idea move through a communist meeting was like watching a flurry of wind move across a ripe cornfield. Each stalk sways briefly and then resumes its upright posture. Much the same goes for the folks who are desperate to make money from online advertising. Once upon a time, they were all obsessing about the ‘social graph’ (i.e. Facebook). Now they’ve moved on to the ‘interest graph’. Just came on a neat explanation of the idea, apparently taken from a Goldman Sachs interview (so you know how seriously to take it).

Social graph signals have not been helpful in optimizing advertising. It seems intuitive to everyone that your friends’ recommendations would be powerful motivators…but when you look a little deeper, you hang out with people who have very different tastes than you. And you may have a special affinity through a hobby or something that they don’t share. One of the mythical high grounds that everyone’s thinking about…is this notion of an interest graph. Facebook connects you with people you know. But what connects you, if you’re into road biking, with the top 15 road bikers that are within 15 miles of where I live? 

[For a platform to] capture the interest graph, they’d be closer to the Google search paradigm, because they’d be right in line with demand generation, and with discovery that relates to product purchases. Context, for the history of the Internet, has been a big deal. The websites that do verticals, while they may not have abundant traffic, have always had huge CPMs, relative to the “Yahoo! Mail”s of the world. That may be this middle ground, between search and the social graph, to bring together people with like interests.

I wonder what the next obsession will be?