Back in April I gave a presentation and the first question from the audience was, “What is the most significant trend in the next 12 months.”  Well, based on JEGI’s Tolman Geff’s presentation at the IAB, I got it right.  Data providers and aggregators have entered the mix and are a key part of the online value chain now in 2010.  Moreso, this data costs money but advertisers aren’t willing to pay higher CPMs, so other player’s margins are getting squeezed.

Nothing illustrated the importance of data like the slide where Tolman showed Burst on one side and Interclick on the other, Burst being an inventory aggregator and Interclick being an audience aggregator.  Burst, Tolman says, is valued at $200,000 and Interclick at $110MM.  I personally believe both valuations are a bit extreme, but point taken.  Focusing on audiences is the way of the future.  But hold on there.

Remember a few years ago when the notion of “premium” became a big deal within ad networks? Once it was out there, every ad network was more premium than the next, each touting wallstreetjournal.com through nameyobaby.com as premium sites.  Forget the site name, it’s premium!  But that passed.  Advertisers and agencies came to expect a certain level of quality, but rarely any more, at least in our meetings, “ooh” and “ahh” at certain sites being on a site list.  It seems this happens with everything that is a big deal at some point in online.  It’s huge and vital at the time, and then becomes a commodity.  This will happen for data too.  Any publisher or network not layering significant amounts of data into their inventory will perform so poorly they’ll be kicked off of clients’ ad buys.  12 months from now, this too will be ho-hum.

Now, back to that premium inventory.  Remember those few networks that got their hundreds of millions while it was hot?  If you’re in the data game, you might consider a note-to-self right about now.  What do you think?

No tags Hide

After multiple years of Starcom/comScore’s “Natural Born Clickers” study showing that clicks are coming from a smaller and smaller group of internet users – and a fairly defined demographic group at that – many clients still want CTR on their reports.  Here we’ll explore three easy ways to wean your client from the CTR metric for good.

1. Research proves the point.  The Starcom/comScore “Natural Born Clickers” study shows that 67% of all banner ad clicks online come from just 4% of the population.  Think about this.  If you have a .10% CTR and consider that a success, realize that 96% of your campaign really has a .033% CTR.  Most clients who are satisfied with the .10% CTR would not be happy at all with the .033% CTR, but that’s exactly what the very large majority of the online population is delivering.  To make it worse, 8% of all users deliver 85% of all clicks.  So now 92% of the population in this same campaign are clicking at a .015% CTR – terrible by most clients’ standards that care about CTR.
2. Bounced visitors isn’t anyone’s real goal.  Many clients have told us that they simply want to “drive traffic to their web site.”  This is rarely true since, when asked if it would be ok if the user clicked on the banner, got to the web site, and then hit the “back” button, most clients say that this is absolutely not ok.  (Wait so you DO want the user to do something on your site?!)  But let’s say for a minute this really is true.  It’s a pure branding play, and the bounced visitor is totally acceptable.  First, wouldn’t a brand study provide the real metrics you care about?  Second, is the demographic you want on your web site the demographic that is actually clicking?  Look at the demographics in the study and you’ll see it’s a fairly defined demographic, often women who are looking for sweepstakes.  Is that your audience?  The reality is that no one really wants a bounced visitor, and therefore working with your client to establish a real post-click/impression goal is advised.
3. Embrace evolution (at least as it relates to online metrics.)  The final and most obvious reason people pay attention to it is that it’s a legacy metric that was the first metric clients jumped on when online advertising started.  Much like the GRP/TRP in TV which is still in use 50 years later, old habits die hard.  If you are an advertiser it is incumbent upon you to learn best practices within the industry. Your agency and publisher partners will share in this process to the extent you invite them to the party, but only you can drive your own success in working with metrics that matter.

Simply sending the next campaign metrics report to your client without CTR is unlikely to win any points, but scheduling a separate discussion with your client specifically about goals, objectives, and the metrics that drive them will provide for a good forum to present these three tips here and begin to explore your online goals in more depth.

No tags Hide

A couple industry colleagues of mine have mentioned WIMI to me, the Wharton Interactive Media Initiative.  WIMI’s boiled-down (self-stated) goal is to better understand the effects of interactive media and to help monetize the interactive industry.  This sounds to me like a theoretically great but realistically impossible objective. Kinda like having a university initiative centered around solving world peace. It’s a good thought.

This recent article brings this point home.  Here is the first sentence of the article: “So what’s a website banner really worth?” I’ve heard this “issue” trying to be solved at multiple conferences too. Well, what would world peace be worth? Does anyone think they’re really going to come to one answer that everyone can agree on?  Frankly, such a grandiose question doesn’t have one answer and the industry is worse off for trying to simplify the thought process behind it.

To address their question, advertisers that only pay on a CPA might place a $.07 CPM value on the banner, no matter where the placement occurs.  Some luxury advertisers; however, pay up to $100 CPMs for the right sites.  As any good salesperson knows, the right price is the highest price a customer will pay while still being very happy with their decision.  Sometimes the buyer’s and seller’s ranges intersect, sometimes they don’t.

The head-scratcher here is this. All well-run businesses know exactly what their key financial metric and goal is.  For some it’s profit per square foot of retail space.  For some it’s profit per employee.  The point is, it’s different for all businesses and surely they teach this at Wharton! So, what’s that particular web site banner or search click worth to THAT specific advertiser? Do the math on conversions and profits and the answer is really quite simple.

No tags Hide

Demand-side platforms, or DSPs are becoming a buzzword lately, along with impression scoring and real-time bidding.  These three terms all point to platforms that allow an advertiser to procure its inventory “on the spot” without any waste.  This is very different from the many ad networks that pre-buy their inventory in bulk and parse out on the back-end.

Full disclosure here.  We are an ad network that does not pre-buy inventory.  We buy on demand as clients agree to work with us so that we can get the exact inventory that independent data says will fit their goals.  That said, firms like Invite Media and Media Math are now making news for similar functionality.  The gist is that whether buying through exchanges or through publishers directly, and pairing the latest behavioral data with that inventory, DSPs are able to acquire only the impressions that are the best fit for their advertisers’ needs while turning away any impressions that don’t make sense for clients on the roster at that time.  Many on the DSP side say that this method eliminates waste and improves metrics.

Networks that pre-buy, and most ad networks that have become popular in the last few years do so, acquire their inventory from their publisher list up front.  Sometimes it’s a quarter in advance, sometimes it’s a year in advance.  These networks and work to have a large and diverse enough client base such that they pre-purchased impressions are beneficial to each client. Left over inventory is either then resold to other networks, sold on an exchange, or blended into a client’s campaign, or simply burned.  Networks that pre-buy believe they have an advantage because they get first pick of inventory from popular sites.

The goal of this piece is not to tell you which is better, but hopefully to shed light on the difference.  Which is right for you?

No tags Hide

What if you knew that 41% of your prospective user base actively avoided your site just because there are too many ads, or the ads were too annoying.  It’s not just that they don’t think about going there or that you don’t have good enough awareness – your site is in their mind as a ‘do not visit’ because it annoys them so much.  The data comes from this recent study.

So, what kinds of sites would do this?  My guess is that many of them are local media site. Many local media outlets are struggling financially and it’s understandable that they want to earn as much revenue as possible.  But at what cost? Let’s take a look at a few local media sites I visited at random:

Here is the Atlanta Journal-Constituion web site.  The first thing that loads is this massive auto-expanding ad.  Maybe I’m on to something here:

Next, the Denver Post.  No massive auto-expander but as I scroll down I find a single screenprint section with three ads in it, lots of animation, and one auto-play video.

Then I hit the Miami Herald.  A pop-under!? Is the sub-$1 ecpm they make off something like this really worth annoying the user – on their first page visit at that?

Finally I visited star-telegram.com, the Fort Worth, TX, newspaper site.  As the page was loading, tags from Tacoda, Quantcast, Dotomi, PointRoll, DoubleClick, Adify, BlueKai and Yieldmanager all loaded.  Surely someone has written in these pages that slow load times don’t make for users wanting to visit often.

I understand the conundrum facing these local publishers.  But, is the incremental revenue they earn from over-advertising worth turning off this many users?

No tags Hide

The new proposed IAB guidelines isn’t breaking news, but the uproar I would have expected over some of its elements hasn’t occurred. The two major revisions, assuming both parties in the buy agree to these new terms, say that creative re-targeting can no longer be used without a separate agreement (and payment, we assume) and that publishers can no longer build profiles of their users based on how those users interact with one advertiser or another.

I won’t comment on the publisher end of this since my familiarity lies much more with how our clients (advertisers and agencies) will react to the inability to creative re-target going forward.  My initial reaction to the creative re-targeting issue is that advertisers have probably enjoyed something too good to be true at no cost for too long and it’s appropriate to come to an end.  It was clearly a technological way to circumvent the spirit and intent of advertising on the site.  This said, most endemic sites sell out of their inventory, and as such, have no more audience to offer – even if the advertiser wanted to pay for it.  In this way, who is it hurting to re-target those users on a network or exchange since that is the only way to be guaranteed of finding them again?

The part of these terms that really seems to make the most sense is the ability for advertisers and publishers to negotiate a separate payment to allow for the creative re-targeting.  To be clear, it’s not that creative re-targeting is being banned completely.  It’s just banned without a separate agreement.  But what will a fair price be?  This will be the negotiation to watch once these terms are implemented.

What would you pay as an advertiser?  Or, what would you charge as a publisher?  I’d enjoy hearing and seeing if the two cross over.

No tags Hide

Those of you reading this right now, by virtue of reading this, are probably thought leaders in the industry.  No, I’m not stroking your ego.  It’s just that most people in our industry don’t actively seek out news or blogs about our industry.  I’m sure every employee at my local Pizza Hut doesn’t read Nation’s Restaurant News, but it’d sure be nice.  We’re fortunate at Goodway to have a very enthusiastic team that does seek out a lot of this information but we can always do better.  One area in which I hoped we could better follow our industry was Twitter, but just telling everyone to hop on Twitter wouldn’t work.

So, instead, we created a private Twitter account, installed Tweetdeck on everyone’s desktop with a login to that account, and it now gives everyone on our team the opportunity to anonymously compliment other team members.  At the end of the month, the people with the most compliments have their names put in a hat and we randomly draw a winner for a gift card.  The senior folks in our company certainly seeded the pool the first week or so but it really took off with compliments flying left and right.  The great part is we also sent out a list of industry thought leaders that might be good to follow on their own personal Twitter accounts, which they could now use simultaneously to the private corporate account.  A number of people did indeed sign up for Twitter for the first time and are learning more about our industry this way.

We wish all of our co-workers were excited about our industry as we are, but if you make it personal the response is likely to be a lot greater and enthusiastic.  What have you done in your company to encourage early adoption?  I’d love to hear it.

No tags Hide

I’m an eMarketer fan.  They produce so many charts that give authority to my presentations. Last week they put out their predictions for OLA in 2010.  Some are on point, others not so much.  Let’s take a look.

eM: “More marketers will increasingly embrace online video advertising, supported by the twin boom of video streams and video ad networks.”
Jay: No doubt video will grow.  What remains to be seen is whether or not new verticals will embrace video.  CPG uses video heavily but auto and retail seem to lag behind.

eM: Regarding ad-targeting and privacy: “From consumers, that will mean greater use of ad-blocking software or browser add-ons and more deletion of cookies.”
Jay: Really?  Have we seen even any meaningful uptick in ad-blocking software?  Have we seen statistical data showing that consumers are deleting their cookies more often?  Additionally, even users who delete their cookies (well under 10% still) populate their cookie set very quickly again and quickly become part of a usable pool.  Privacy is becoming a big deal because certain publishers know and keep more info than they should.  I don’t believe consumers care much about your average day to day BT campaign.

eM: “The development of search engines, and related advertising, will increasingly include data gathered through the social Internet, including the real-time data from communication sites—mainly Twitter.”
Jay: Definitely, but eM goes on to suggest this will continue to cause privacy concerns, and I don’t agree with that.  People know full well that if they publish something online it will become searchable and public.  I do agree, though, with the notion that search will continue to be important, and increase its importance with the inclusion of real-time user-generated postings.

Good stuff eMarketer, but what about the questions no one is asking?  Will the disciplines of search and social begin to overlap to the point of not telling them apart? Will search agencies then start to take a stake in social?  Or vice versa?  Will all this talk of social search overshadow the need for a solid display (potentially including video) campaign to drive search and site visitation behavior?

Lots to think about, huh?

No tags Hide