Ideas People Channel targets audiences based on psychographic, not demographic, factors
Kathleen Kennedy, chief strategy officer of Technology Review, has dabbled in advertising networks in the past, with less than inspiring returns.
“We did two tests with ad networks and both times the results were quite disappointing,” Kennedy said. “The CPMs [cost per thousand] ended up being much lower than expected. Also, the quality of the advertisers was often questionable, so our ad team had to spend time blocking certain campaigns. The low revenue was not worth the effort.”
Kennedy said she is expecting a different result from The Economist Group's Ideas People Channel, an online ad network that is designed to aggregate an audience based on psychographic—rather than demographic—factors.
“We see it as a great supplement to our current sales effort, which is mainly focused on b-to-b,” she said. “With a much larger reach, [the channel] can compete for the mass consumer campaigns that technology review.com would not be able to win on our own as a single site.”
Ideas People Channel rolled out in late October with nearly 30 niche brands identified by The Economist's audience as their favorite destinations. In addition to Technology Review, publishing partners include Chronicle of Higher Education, Chronicle of Philanthropy, The Economist Online and International Business Times.
The IE Business School, based in Madrid, and APSCU (Association Private Sector Colleges and Universities) are the first two advertisers to buy the network, with additional buyers in the pipeline, said Stephane Pere, VP-head of Ideas People Channel.
“It's an important way for us to get more ad revenue,” he said. “In the online-display market, we know a huge portion of ad expenditures goes to networks, so we really wanted to come up with a premium and a different offer in the market.”
A separate sales team has been set up to sell the channel. “It's not about customized [ad units]; it's not about sponsorship. It's about reaching a scale of "ideas people' with rich media banners,” Pere added.
The Economist Group estimates that there are 21 million ideas people in the U.S., based on such criteria as whether the individual is publicly active, owns a passport or is a heavy reader of books.
Pere said Ideas People Channel caters to the growing demand among brand marketers for more specificity about the audiences they're buying. “It's interesting that today in an RFP [request for proposal] there is always some criterion about these psychographic elements,” he said. “We can tap into that for clients because we can provide a mindset and scale.”
The new channel comes as The Economist Group's flagship struggles against the decline in print ad spending. Through June The Economist's circulation grew 1.5%, to 822,695, compared with the year-earlier period, according to the Audit Bureau of Circulations. Through September, however, ad page growth was relatively flat compared with the same period last year, according to MPA.
“They're trying to add inventory to sell to advertisers,” said Dave Rowe, VP-media director of b-to-b ad agency Doremus, whose clients include Sage North America and SonicWALL Inc. “The question is whether the channel is greater than the sum of its parts. I bet a lot of these sites [participating in the network] don't have a ton of traffic.”
Rowe added that it was “curious” that The Economist Group was taking an anti-cookie stance in marketing the program. “They may be trying to avoid being perceived as an [ad] network in which marketers can buy at a low CPM.”