I’m headed to ad:tech today and would prefer not to pay $400 or more for a hotel in Manhattan. So I turned to Hotwire where I was offered a 3.5 star room for $219 (not the best deal I’ve had in Manhattan but it beats $400).   I didn’t know the name of the hotel before booking but I’ve booked with Hotwire a number of times and it’s always been a positive, and fair experience.  I’ll admit, though, that the first time or two I booked on Hotwire I was completely nervous. How could I be absolutely sure the hotel would be what I wanted?  Plus, I was curious beyond belief as to which hotel I’d be getting.

The 3^rd party ad network world works very similar to this process.  Each advertiser will have a few publishers that they need to be on and need to know they’ll appear on.  In that case they should pay the first-run CPMs, reserve the space and make sure they get the very best performing inventory.  There are hundreds of other publications they know they’d like to appear on but there are two problems.  First, there isn’t enough manpower in the agency world to directly purchase 100 publishers and optimize them on each buy.  Second, none of those publishers are individually worth the first-run CPM of (let’s say) $10, since the advertiser could take or leave any of them.  Along came ad networks.

Like my first time on Hotwire, early ad network buyers were skeptical and curious out of their minds.  Unlike Hotwire, most 3^rd party ad networks don’t actually show the advertiser the name of the hotel/publisher at any point in the purchase process.  This level of opaqueness has opened up a new industry of verification providers to give advertisers the peace of mind that they are indeed running within the site list that was promised, but not all providers stop it there.  Some now want to reveal the exact URL on which every impression runs and provide that back to the advertiser.  The verification industry is one I’ve personally long advocated and think could be exactly what the 3^rd party ad network industry needs to grow tremendously.  It could also be disastrous.  Here’s why, and subsequently a suggested Advertiser/Agency Verification Bill of Rights to ensure publisher rate integrity, ad network business model integrity, and advertiser confidence.

Publishers clearly have a love/hate relationship with ad networks.  Those that have billions of unsold ad impressions each month hate that they haven’t sold them, and also that they have to sell them off at a severely discounted price from where they would have sold them first run.  Then again, better to get some monetization than nothing at all.  The lynch pin for publishers agreeing to participate in the ad network world is that the advertiser will never be guaranteed to run on their site, and certainly not for any specified amount.  This is fair, since if advertisers want a guarantee to run on the site they should go pay first-run rates!  However, if ad verification software reveals not only the identity of all of the sites on which the advertiser ran, but the quantity of impressions that ran on each site, that will be too much for publishers and they will do one of two things.  They will blacklist that advertiser from running on unsold inventory (so be careful advertisers, curiosity may kill the cat here), or they will withdraw from being a part of that network.  If it happens too often, they’ll withdraw their remnant inventory all together.  While this is clearly bad for ad networks, the ultimate losers here are the advertisers, or maybe just the ad agencies themselves.  Without ad networks, agencies are left to buying every single publisher individually, even if through an exchange (also incredibly blind in many cases but that’s for another day) and paying higher CPMs.  So, for the advertiser that was getting 250MM impressions for their fixed budget before, they’re now looking at 100MM.  Less reach, less frequency, less KPIs/site-based actions, less sales, and so on.  Agencies and advertisers, do you really want this?  I’m guessing you don’t, but you want honesty and security and that is fair. Consider this Advertiser/Agency Verification Bill of Rights as a way to use verification to your, and all of our advantage, without harming one of the best things going.

Agencies/Advertisers Verification Bill of Rights:

1. You have every right to know that your ads only appeared within the provided site list during and after the campaign, and to see the URLs of any sites on which your ads appeared outside of that pre-approved site list
2. You have every right to not be victimized by click or action fraud, to know when it happens, and to receive a full refund on any monies spent which enabled or allowed such activity
3. You have every right to know if more than 50% of the impressions within a buy occur on just one site or domain within the site list
4. A publisher may remove any agency or advertiser (for one campaign, or possibly permanently) which uses software that unmasks the complete list of sites on which your ad appeared during the campaign.  Right #1 and #3 ensure agency/advertiser safety in this case
5. A publisher may remove any agency or advertiser (for one campaign, or possibly permanently) which uses software that unmasks how many impressions ran on specific sites within the campaign.
6. You have the right to have at least 80% of your ads appear within screenshot view of the user.  (This resolves the “above the fold” concern, and addresses dirty publishers that place ad units so far down the page that no one will ever see them. 100% would be great but is unrealistic and would compromise the desirability of some of the best rectangle mid-page units.
7. You have a right to a full refund of money spent on any inventory which violates the above rules.

This is just a start and I’d love feedback and a respectful debate back and forth on how to round out this list and hand it to the Ad Network & Exchange committee @ the IAB to finalize.  Agencies and publishers alike have every reason to love and be nervous about ad networks.  Let’s root out anyone who’s misbehaving, provide honesty and integrity to the 90% who are doing it right, and ensure that paying customers get what they’re really paying for.

No tags Hide

Yeah, the whole economy tanked in the last year.  Banking and housing led the way but autos may have been the hardest hit vertical other than the American individual itself.  For context:

• Auto sales were the lowest in sheer volume in 27 years
• Auto sales were the lowest in cars sold per capita in 52 years.  Think about that, cars sold per capita were no better in the last 12 months than in 1957
• Toyota had never lost money in a fiscal year since entering the U.S. over 50 years ago, yet lost billions in the last 12 months
• And, of course, two major domestic auto manufacturers had to go through a government-catalyzed bankruptcy to rebuild their companies to survive

The JD Power Automotive Internet Roundtable overtook the Red Rock Resort in Las Vegas last week and showed us how both the consumer and industry have changed. To start, here are just a few of the industry highlights:

• U.S. consumers bought wayyyy too many vehicles in the late 90s and early 00s – over 14MM annually (pure retail, not fleet). We won’t hit 9MM retail sales in 2009
• Cash For Clunkers brought the average days’ supply of vehicles on a dealer lot from 94 to 58 – a true saving grace for the industry
• Hyundai and Subaru have shined in the last 18 months, impressively gobbling up market share
• 76% of car buyers go online to research their purchase and the big year over year leaps appear to be over (75% in 08.)
• 19% of online auto shoppers START shopping on a dealer web site, basically making the “funnel” notion irrelevant for that 1/5 of the online car shopping population
• Still only 22% of online car shoppers submit a lead, making it the most falsely chased metric in all of online
• By volume, more online car shoppers are found on Facebook than any other web site
• All third party sites are definitely not created equal. Some shine in viewing photos, some for trade-in info, and some with used vehicles. Don’t buy them all just because they have lots of uniques
• Finding and creating consideration with a buyer early on in the process is still the most effective way to close a sale, not chasing after a buyer in the last few weeks of their decision cycle when they’ve likely already decided what model they’ll buy

One of my favorite quotes is, “change doesn’t occur without sufficient dissatisfaction with the status quo.” We can safely say that the last 12 months has produced sufficient dissatisfaction with the status quo. So, what has changed? So what has really changed? A lot, and probably more in the coming months. Here is a start:

• Ford now spends a full 25% of its marketing budget on a digital – a very appropriate percentage according to media consumption habits
• A significant number of dealers at least have a Twitter account and are dedicated to understanding how to foster open community conversation around their brand
• There is less talk about how to “control the conversation” and more talk about how to be “open and honest.” A very good step overall
• ALL participants at this show were already using online. In the past there have always been a few “still trying to figure out if online was right for them”. Huge step forward.

Social media may be the fresh paint on the outside of the house but just because it’s shiny doesn’t mean it’s the answer to all our problems. The biggest problems that weren’t solved (and who knows if they’ll ever be) were:

• Dealers want their own web sites and to own/promote their brand while manufacturers want controlled point-specific sites. This did not seem resolvable
• Exactly how to embrace open and honest conversation in social media without fearing the results
• Whether or not search really belongs at all three tiers, and if it does, how to eliminate cross-bidding
• How to avoid bidding wars between OEM/retailers and the third party auto sites for the same search terms

When sales go down more than 40%, change no longer seems like such a bad idea. The auto industry has shed itself of some outdated thinking that held it back in past years and embraced the reality of media consumption shifts, a bold move that will serve it, and our industry, very well in the coming years.

No tags Hide

There has been talk for years about the convergence of online with TV – even as far back as 1999. Certainly the notion of online video becoming one with TV has merit and makes sense.  In fact, eight moths ago Netflix CEO Reed Hastings predicted the DVD had 9 more years left to its lifespan.  Now he says it has two years left.  Why the change in timeline and so suddenly?

All of this brings about the old Web/TV convergence discussion. When is it going to happen and more importantly, what happens then?  Let me put forth a new theory – divergence – of the web itself.  Users consume online content in two ways – leaning back and leaning forward.  Reading email, articles, doing spreadsheets, all of these are lean-forward activities.  Watching online video is largely lean back, just like watching TV.  So, while online video parallels TV in this fashion, much of what we do online doesn’t.  The lean-forward activities make up most of our online time andare generally not activities we want to do while taking up the family TV.

So, rather than talking about the pending convergence of of Web and TV, maybe the focus should be on how the web will diverge and how we can all use this transformation to our advantage. Sure, TV will still morph in the coming years to include more streaming and online-like content, but the web in itself will not fold like a tent and become part of TV.  We’ve built a tremendous industry on audience delivery and measurable results.  It’s worth noting to those who want everything to simply become part of TV that convergence of the TV with online video is not the end, but an occurrence within the growth of online itself.

What do you think?

No tags Hide

Like snobby socialites who look down on the couple who just bought their meager 50′ yacht, folks just like you and me gather at digital media conferences throughout the year and pity the poor saps who still look at CTR as their primary metric.  “Oh, how 1998 of them!”  “Why don’t you just throw your money on TV!”  Ha ha ha, we all laugh.  And, as a metaphorical canyon to echo these laughs, comScore’s ‘is anyone really clicking anymore?’ study was just updated, showing that only 16% of the online population compromises 80% of all clicks. Maybe the laughs were reasonable?

While focusing on CTR and not on measured outcomes is certainly a sin, a bigger one is out there that I didn’t know was still occurring until recently.  Apparently there are agencies who absolutely can and do measure outcomes and use them as their primary metric – but don’t let publishers pixel those outcomes to optimize!  I could’ve sworn that not allowing publishers/networks to place conversion pixels was a thing of the past – the thin necktie of online.  Not so.

So what could be the rationale here?  Universal conversion tags have existed for years, allowing a one-time placement of a conversion tag on a site and then implementation and removal of publisher tags from within the ad server.  So, the latency concern and site “structural integrity” concern are gone, so it’s not that issue.  We all now know exactly how universal tags work in that they’re not giving any private information to publishers, so privacy isn’t the concern.

So what is it?  I honestly don’t know, but I do know that both the agency and the client lose out on significant performance upside when campaigns are operated this way. In an era where “win win” is so important, why would anyone work within a “lose lose” scenario?

No tags Hide

What percent of Nytimes.com’s traffic comes from Twitter?  1%? 2%?  No, 10%.  Yup, one of every 10 visitors to the web’s 58th largest site comes from Twitter.  This is likely a contributing factor to Nytimes.com traffic growing ~1MM monthly uniques over the last year to boot.  Yet people in our industry still don’t choose to understand Twitter’s importance.

Facebook was once relegated to this same “I don’t get it” status but is now the darling of our industry.  A quick look at the numbers show why Twitter, and any other up and coming social communication tool is worth watching.

New York Times
Facebook fans: 473,692
Twitter followers: 1,898,952

Not fair because it’s a communications outlet and not a brand?

Try Zappos:
Facebook fans: 2,624
Twitter followers: 1,364,991

Or Jet Blue:
Facebook fans: 30,864
Twitter followers: 1,285,797

This report by Nielsen online also shows that Twitter is the fastest growing member community destination, increasing 1,382 percent year over year.

Yes, there are plenty of brands with many more Facebook fans than Twitter followers but this post isn’t saying Twitter is better than Facebook, just something industry participants can no longer ignore. Yet, it still baffles me how many people within our industry haven’t bothered to just get on Twitter to “get it”.

If you suggest that Twitter (or facebook for that matter) is only a place where people post 140-character statements about what they ate for dinner, think again. Most all major brands now have some form of monitoring in place to listen to what customers are saying about them . Other companies use it as a way to humanize their brand and speak to their customers.  Tweet about Dunkin Donuts and, chances are, they will respond to your tweet with a personal message. That kind of real-time engagement excites customers, keeps them engaged, and most importantly, drives them to become hardcore fans of your brand.

So, if you’re reading this and indeed are one of these people, sign up for Twitter today.  Pick ten ‘handles’ to follow (you can start here or here.)  Then give it a month.  You’ll frequently learn something new and most importantly, even if you never tweet, you’ll “get” a very important trend in our industry.

No tags Hide

The Silicon Alley Insider chart of the day drops into my inbox each day like clockwork. The chart sent out two days ago was titled “Boob Tube Still Dwarfs YouTube.”  It’s below.

To dispel any sentiment that may be gleaned from the headline, I am not someone who thinks 100% of budgets should be online and TV should be thrown out the window.  In fact, there are many times where TV should get a majority of the budget (initial product launch, major national brand awareness campaigns, etc.)  That said, while the information in this chart is true, it’s misleading.  That’s because it compares the number of hours watching TV with the number of hours watching online video only.  Not hours spent online, but just watching video online.

Here’s another chart that tells a more complete picture.

Good chart despite being from 2007 (more recent data has shown that TV has held steady and online has climbed a bit).  Advertising is ultimately about getting eyeballs/ears and then prioritizing a brand higher within the mental list in a given category.  So if 29% of media consumption is spent online and 37% is spent on TV, it’s definitely not the 43:1 ratio the SAI chart would lead you to believe.

My experience tells me most TV Reps would show you the first chart and not the second. I’d ask online reps to hold themselves to a higher standard.  Give your clients and prospects complete information.  Online media really does sell itself.

As always I enjoy your comments and look forward to hearing from you.

No tags Hide

Online video and its “growth” sure is all the rage lately.  Article after article are written about its weed-like growth.  A real problem for the growth of this aspect of online is that most of the videos being viewed are, well, garbage.  Garbage that most brands don’t want to be associated with.

Look at these two graphs:

14.2% growth is huge when the base was already over 100MM users.  The problem is that the number of users watching good quality content suitable for most advertisers rather than people jumping off houses into trampolines is not anywhere near 100MM.

In fact, the second graph shows that YouTube streamed more than four times the number of videos that the next nine largest sites streamed combined.  YouTube also had more uniques than all the others combined.  What’s on YouTube?  Some quality, but mostly videos of people doing things like jumping off trampolines into houses.

For online video to become a larger part of most brand marketers’ plans rather than just a small number of brand marketers’ plans, studios and content owners might pay attention to the “figure out the revenue model later” adopted by so many successful online companies.Facebook, Twitter, even Quantcast on the B2B side have had explosive growth and created businesses worth billions of dollars by taking in no money.

While online video is mostly free night now, it’s not free enough.  By that I mean that TV shows and movie content are not easily downloadable AND transferable between any devices unless you are an Apple die-hard (and with Apple having only 7.6% of the PC market, they will not drive this bus).  It’s also a universal format issue.  Transferring files from PC to Blackberry, PC to DVD, PC to PSP – you name it – has to be easy enough for Mom and Dad to do it.  Right now, it’s a nightmare.

During this so-called explosive period of growth for online video the market caps of TV and movie studios hasn’t grown much.  Meanwhile, those who give their product away completely free have businesses worth billions, up from $0 just a few years ago.  Yes, SAG talent needs to be compensated.  Yes, the studios will lose a little to those who cheat the system.  But massive growth among videos of people’s dogs on skateboards will not drive online video to be a major chunk of this industry’s spending.  Quality content that is easily viewed in any format could drive it through the roof tomorrow.

No tags Hide

Last week Quentin George spoke at OMMA Ad Nets about the blending of the agency and ad network models. He was referring to Cadreon, IPG’s in-house network being formed, and suggested that the entire agency model really needs to change.  Well, we’ve been hearing that for a while.  In fact, I tweeted that he may be right but, until pain is visible and felt at the core, there is no reason to change.

A recent OMMA article in which Tim Hanlon of Vivaki suggested that a major change needed at the ad agency level is the need to place creative planning at the center of every interactive campaign. This struck me as a true agency point of difference, something that could legitimately allow for one agency to win a new business pitch over another.  Let me explain.

As a network working closely with media departments, we win business because we can explain what differentiates us from other networks and prove how we generate real measurable results. A top complaint we hear from planners/buyers is the lack of creative executions and the lack of creative addressing individual audiences coinciding with the various segments bought in the media.  Simply put, if you’re buying both retention and conquest in tech, medical, auto, etc., for 10 different models or products, there should be 20 different variations (10 models x conquest and retention).  Multiple executions for high message frequency exponentially increases the volume here, but we can make the point without getting into that.

Some agencies do this and do a great job of it.  Some don’t do it at all.  I believe the reason some don’t is the lack of a specialized role that I’d call a creative planner – someone to liaison between creative and media with the ability to scope out the necessary fees and time associated with each campaign based on what is necessary to do the campaign (at least mostly) right. In other words, the agency tells the client up front, “We recommend strongly that if we’re buying 10 models’ worth of retention and conquest that the budget to do the appropriate amount of creative be set aside to make it work correctly.”  Certainly a projected ROI analysis will prove the exercise worthwhile, and with technologies like Adroit and Tumri, it’s not even that expensive to do!  Compare this to agencies that come in with one version of spec creative and who do you think the client will pick?

It’s well known that change doesn’t occur without being sufficiently dissatisfied with the status quo.  Whether this is the most important job in an agency in 2012 or today depends on whether or not sufficient dissatisfaction is created.  Who will change the status quo?

No tags Hide

Online media measurement is apparently too complicated.  But rather than slowing down to explain and bring people along we’re giving up altogether and going backwards.  Really? GRPs over individual user targeting or frequency to conversion analysis?  Reach/frequency over behavioral, affinity/predictive, or contextual?  Maybe we should toss third party ad serving out the window and just have Nielsen tell us the next day if any of 350 people remember seeing the ad via a diary.  Yeah, that’s it!

Kudos are due to those that create new markets, like the first ad networks, BlueKai, Tumri, MySpace, and Twitter.  Somehow these experience mass adoption and involve people learning how to do new things in new ways but media measurement can’t get that same traction.  Reverting back to T/GRPs and R/F is not the answer – nor is throwing out a 728×90 and calling it a 3c x 1.25″ (for those of you old enough to calculate newspaper column inches!) As always I’d enjoy your feedback.

No tags Hide

I’d say I’m a pretty voracious RSS/blog reader.  I enjoy learning what I can about our industry, and as a result try to contribute back with insightful blogs myself.  The more I read lately, though, the more it seems there is no hope for our industry.  That’s right, none at all.

Apparently, display advertising is dying, dead, or died a long time ago.  Search is dead, too.  Even SEO is dead, which I guess makes sense since search isn’t around.  But gosh, what about something really new and trendy that’s still growing in big numbers – like Twitter?  Nope, dead.  Even the bloggers predict their own fate.

So why are any of us still hanging around in this awful, dying industry?  My thought is that it’s growing like gangbusters, not dead at all, and wonderfully alive despite what is happening in other media.

So let’s stop ‘the death of’ stuff.  I’m apparently not even the first one to ask for the death of ‘the death of’!  Yes, it’s easy to be sensationalistic. Yes, there’ll be a quick traffic uptick.  But what about when people look back at a “death of” article in two years and see that what was proclaimed to be dying is still thriving? It seems that bloggers who skip the sensationalism and instead provide thoughtful, insightful commentary are the ones who succeed the most.   So, can we all proclaim the death of ‘the death of’?  Use the comments box below and let me know if you’re with me.

No tags Hide