Source: Seth's Blog
Seth Godin identifies a structural problem in attention markets: the winner's curse means that whoever secures ad clicks through auction bidding has necessarily paid more than the market's median valuation of that attention, since all other bidders rationally dropped out at a lower price. This reframes digital advertising efficiency—the supposed advantage of real-time bidding and programmatic auctions—as a system that systematically incentivizes overpayment for a commodity whose actual conversion value remains uncertain at purchase time. Brands chasing visibility through auction-based platforms pay premium rates for attention that the market itself deemed worth less.