No more hot air

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Welcome to the Jupiter Online Advertising Forum 2001....

Where a guy whose dot-com recently shut down is wearing the registration tag of an online advertising executive who'd gotten laid off the day before the Aug. 7 start of the annual New York conference. Desperate times call for kiting of registration tags when a three-day pass goes for $1,890 a pop.

A gathering that attracted close to 700 people last year by one estumate, this year's three-day conference provided the best snapshot available of the industry as a whole, even if roughly half as many people attended. Indeed, even if Jupiter's attendance was off dramatically, it remains one of the few games in town. Camp Interactive, a seven-year-old summer conference put on by Digitrends, was canceled two weeks ago due to what a company Web site called "not enough attendee support."

Not that Wall Street gives much credit to those who can still manage to stage the once-ubiquitous conferences. Jupiter Media Metrix stock hit an all-time low of 75 cents on the final day of the conference. It has a market cap of less than $30 million.

By comparison, competitor Nielsen/NetRatings, despite pulling in only about one-fourth of Jupiter's revenue in the second quarter, has a market cap of about $425 million, which gives a startling insight into the inordinate value given to Web-focused businesses aligned with more traditional companies, and makes one wonder why NetRatings doesn't just get rid of the competition by buying them. NetRatings is majority owned by global media giant VNU, parent of Nielsen Media Research.

THE GIDDINESS IS GONE

But in an industry where faltering share prices are very, very old news, the focus at a conference like Jupiter's was on coming up with ways to fix a broken business. Time was when the hallways adjoining the main seminar room were teeming with maniacally networking power cell phone users, while the panels-in which people openly competed in out-hyping each other-were a sideshow to the frenetic scheming elsewhere in the hotel.

This year, the hallways at the New York Hilton were nearly empty, while the seminar room took on the atmosphere of a university lecture hall only days before the big exam-note taking replaced e-mail surfing and most of the chatter took place on stage. "People are very serious here," observed Scott Moore, publisher of Microsoft Corp.'s e-zine Slate, who sensed an industrywide focus on solving problems collectively. "In the past couple of years it was all people sniping at each other."

Indeed, one Jupiter executive acknowledged the company shifted the focus of its conference for a more thoughtful, knowledge-hungry crowd. "We changed the program to accommodate that," he said.

DEATH TO CLIPPIE ... AND STALE ADS

Attendees probably came away with the message that if greed has long ago been discredited, "Experimentation is good," as Unicast CEO Richard Hopple intoned during an Aug. 8 afternoon panel. Generally speaking, new ad formats ranging from skyscrapers to advergames are experiencing broad industry support amid some indications that, for the time being, the newer formats are creating greater user interest.

According to Jane Chen, director of strategy at entertainment-oriented New York i-shop KPE, about 750,000 of several million people that recently received an e-mail game from client Microsoft clicked through. In preparation for the launch of Office XP, the game gave recipients the tantalizing opportunity to off "Clippie," the cloying cartoon character that guided users through the old Microsoft Office. Of course, as with much online advertising, no one yet knows what the game will do for sales of the new version. Maybe all those people just really, really wanted to kill Clippie.

The same lack of concrete results also afflicts one of the most talked-about online promos of the year: the elaborate game built around the movie "A.I." While saying the game generated a higher-than-expected level of interest, Microsoft Entertainment Group creative director Jordan Weisman, who created the game, acknowledged that those involved "really don't know" what impact it had on ticket sales.

SEEKING REDEMPTION

Still, even as the search continues for intelligent advertising in the online universe, the conference did have a few bright spots. According to one study unveiled by Jupiter Media Metrix's AdRelevance unit, 21% more of the Fortune 100 are advertising online than a year ago, rising to 81 of 100. However, the study found they are increasing their investment at a slower rate than the industry as a whole.

Another study showed that Web publishers might be selling more ads given that the percentage of house ads used by publishers has declined since January, from 35% to 24% now. And some companies, such as Microsoft (see related story on this page), are putting considerable funds behind making the online medium better for advertisers.

But the search for answers will continue until the good headlines start to outnumber the bad.

While past Jupiter conferences featured parties at the hippest Manhattan nightspots, this one was, well, monastic by comparison.

The only party this journalist was invited to, sponsored by Dynamic Logic, was held at St. Bartholomew's Episcopal Church-a sign, if ever there was one, that the online advertising industry needs to keep the faith.

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