Unlike Conde's exchange, though, Hearst Digital Media's platform
is not aimed at increasing sell through on its sites; the company
will continue to partner with select display and video ad networks
to unload its unsold ad inventory. Rather, the new "audience
exchange" (as Hearst is calling it) will let advertisers who are
making upfront buys with Hearst's direct sales team target specific
groups of consumers across Hearst Digital Media's 25-plus online
brands, which include web and mobile sites for Seventeen, Elle,
Good Housekeeping and Esquire.
For example, Hearst will start selling the ability to target ads
to readers it has grouped into various food-related audience
segments -- "dieter" may be one audience segment and "entertainer"
may be another.
Advertisers' trading desks or demand-side platforms will plug
into Hearst's exchange -- powered by Pubmatic -- to execute these
buys. In theory, more targeted ads should generate better returns
for these advertisers who are already doing business with Hearst.
And happy advertisers usually mean increased budgets the next time
What's unique about this exchange is that it will also be
connected directly to a Hearst-owned data-management platform that
brands use to organize and create their own customer profiles and
audience segments based on their own first-party data. This
integration means advertisers can easily port over their own
segments that they've created and then target ads to those custom
groups across the Hearst sites.
The data platform came to Hearst in December, when Hearst-owned
digital agency iCrossing acquired a
company called Red Aril. Separately, Hearst Digital Media
eventually plans to use the data-management technology to help it
group its own readers into different categories and personalize the
content experience for each set of readers, according to Kristine
Welker, the unit's chief revenue officer.
Hearst's hope is that the new audience exchange also helps it
tap into budgets that its existing direct-sales advertisers have
set aside for automated ad buying.
"We definitely recognize the growing need for efficiency," Ms.
Hearst Digital Media properties registered 20.3 million unique
visitors in May, up 39% from 14.6 million in the same month last
year. When broken up into audience segments, the potential reach
for a given ad buy is much smaller. With that said, Hearst plans to
eventually allow advertisers to extend their audience buys to the
digital properties of Hearst newspapers in addition to its magazine
sites, according to Ms. Welker.