ARE NETWORKS A NEW THING?
WHAT DO NETWORKS SELL? JUST DISPLAY ADS?
WOW, THAT SOUNDS CONFUSING. HOW DO I BUY INVENTORY FROM A NETWORK?
IF I BUY A NETWORK, DO I KNOW WHERE MY AD WILL APPEAR?
I'M A PUBLISHER. WHAT'S IN IT FOR ME TO GET INVOLVED WITH A NETWORK?
WHO ARE THE TOP NETWORKS?
WILL CONSOLIDATION AFFECT THE SCALABILITY OF AD NETWORKS?
OK, SO WHAT'S A VERTICAL NETWORK?
I KEEP HEARING ABOUT AD EXCHANGES. EXPLAIN.
Portals & Publishers Compete for Ad Gold
Nada Stirratt is on both sides of one of the hottest debates in online advertising: When it comes to vertical targeting across ad networks, who does it best -- the portals or the publishers?
Ms. Stirratt, exec VP of MTV Networks Digital Media, is positioning her company's multiple offerings to the middle of the ad network's short and long tails. A major portal-based ad network such as AOL's Advertising.com or Microsoft's DrivePM has more scale and diversified audiences to sell an advertiser looking to target through search, display and other algorithm-based ad models.
Although Ms. Stirratt is steering clear of the algorithm model for MTVN's properties, her digital-media group has recently aligned with Microsoft on a broad-based partnership that spans technology, data, content and ad-serving to help monetize remnant ad inventory on the back end. On the front end, it allows her to focus on what she considers the "middle part of the tail," the vertical ad networks.
"It's very different from 10 years ago, when you were talking about AOL and AOL only. ...You'll see a lot more of these distribution deals and see [vertical ad networks] playing a bigger role. "
Ms. Stirratt is not alone in this blitzkrieg approach to targeting demos. A wide range of publishers have built their own large-scale ad networks around specific audiences by following a two-pronged approach: they start with a core site (like Heavy.com or MarthaStewart.com) that generates steady traffic but maybe not enough scale in unique visitors to represent a major buy for a marketer, then ramp up that scale by adding other similarly-themed sites to the network and selling across the impressions.
That's a major selling point for Heavy.com -- a site geared toward men 18 to 34 -- that reaches around 5 million unique visitors a month on its own. But after its network of partner sites is factored in, that audience grows to as much as 17 million to 20 million uniques, depending on how broadly an advertiser wants to target the audience. Eric Hadley, a Microsoft vet who joined Heavy as its chief marketing officer last September, is hoping to expand that audience to closer to 30 million by year's end, having just launched the Heavy Men's Network to include sites such as Vidshadow, USA Today's BNQT, and urban-entertainment site QD3 among the Heavy-hitters.
As consumers spend time on different sites within their lifestyle categories, so go the ad dollars. In its annual Digital Outlook report last month, Microsoft-owned Avenue A/ Razorfish showed year-over-year media spending on the main portals decreased for the first time in the past four years, declining from 24% in 2006 to 19% in 2007. Concurrently, the number of individual sites the agency spent its dollars more than doubled from 863 to 1,800 in 2007.
Ryan Roslansky, VP of product management for Glam Media, said the network has begun to cast a more critical eye before welcoming more publishers to a network that already includes more than 400 indie fashion and lifestyle sites. "We've really started to determine from an advertising-dollars side it's really about quality not quantity," he said.
Carl Fremont, senior VP-media director at Digitas, said the larger vertical ad networks tend to get the same consideration as a niche print or cable buy, and the buys are always based on the audience and the content. The targetability is the most appealing factor, but "driving revenue from scale is going to be one of their greatest challenges. "
Because of this sentiment, the major portals aren't sweating their status just yet. Advertising.com, the largest online ad network and part of AOL's Platform A, recently added a Performance Video Product to bring more formats and accountable metrics to an already sizable client base. President Lynda Clarizio said, "It's all about providing choice and options to advertisers. The bigger your network is , the greater the targeting options."