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DoubleClick adds DM capabilities

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The Internet's dominant ad-serving network is out to become its dominant direct marketing service.

DoubleClick Inc., New York, has debuted a service that sells banner advertising to marketers looking for low costs per measure on highly targeted sites. Called Sonar Network, it marks a dramatic departure for DoubleClick, which has focused on high-traffic sites.

"We think this is a great product for direct marketers," said Andy Jacobson, Sonar Network VP-general manager. "After all, the key things they are looking for are targeting, optimization and cost."

DoubleClick is far from the first in this arena. Sonar Network stands to compete with such stalwarts in low-cost, targeted Internet advertising as 24/7 Media's ContentZone, New York; B2BWorks, Chicago; Flycast Communications Inc., San Francisco; and ValueClick, Carpinteria, Calif.

Moreover, e-mail marketing is generally the preferred way for direct marketers to reach a business audience. Sixty-one percent of all midsize and large companies use e-mail regularly to market to customers and prospects, according to a recent report by e-land Inc., New York.

A big difference between DoubleClick and many of its ad-server competitors is it plans to focus much of its effort on b-to-b advertising. ValueClick and others have found their best results in business-to-consumer.

"We haven't made a big push to the business-to-business market, but in those cases where it has been used, marketers find it works great," said Guy Hill, ValueClick director of marketing.

Before forming Sonar Network, DoubleClick was turning away $1.5 million a month from advertisers seeking Internet ad serving that resembled direct marketing, Jacobson said. Instead, it concentrated on facilitating broad campaigns by placing advertisements on sites that generate at least 1 million monthly impressions, and exclusively representing certain sites that exceed 2 million monthly impressions.

Under the Sonar Network model, DoubleClick will place ads on sites that generate a minimum of 100,000 monthly impressions.

Already, the company has 96 publishers signed in 16 affinity groups, representing a total of 1 billion monthly impressions, Jacobson said. The goal is to sign enough publishers by the year's end to top 4 billion monthly impressions. When it does, more specific affinity groups will be established under the original 16.

Sonar Network plans to slice and dice the target audience in ways direct marketers prefer.

For example, it will place frequency caps on advertisements, making it possible for a marketer to ensure that a potential customer is not presented the same advertisement more than three times. Geographic segmentation, a pricey proposition in traditional direct marketing, is also part of the service, Jacobson said.

Sonar Network's ability to identify its audience will prove crucial, said Sam Alfstad, publisher of the eMail Marketing Report.

Alfstad was skeptical that Sonar Network would ultimately appeal to direct marketers. There's a big difference between running a campaign delivering thousands of impressions, and working and refining a targeted direct mail campaign, he said.

"I think DoubleClick is just trying to sell the bottom of their inventory," Alfstad said. "In direct marketing, the same prudent strategies that have worked since Sears and Montgomery Ward started distributing catalogs 100 years ago are still the best strategies. There's nothing to replace really good, sharp targeting of an audience."

A combination of e-mail direct marketing and performance-based advertising is the way to go, said Gloria Beck, director of customer acquisition for OfficeClick.com.

Launched in November, OfficeClick.com, Palo Alto, Calif., has been trying to draw office administrators to its site. Though OfficeClick is not ready to release subscriber figures, direct e-mail has done wonders for membership, Beck said. But there are simply not enough quality e-mail lists around to reach its core audience, she said.

To compensate, OfficeClick has been concentrating on targeted advertising campaigns on a number of networks.

"While the e-mail market is growing rapidly and is definitely an attractive place for us to be, the challenge is finding enough of the right e-mail lists," Beck said. "In light of that, network banner buys, when they are relatively inexpensive, can definitely pay out on a cost-per-acquisition basis."

What's the cost of DoubleClick's new strategy? Sonar Network will charge $12 per thousand impressions to run a campaign, placing it between Flycast and 24/7 in rates, Jacobson said.

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