Tuesday, March 25, 2008

The rise of the premium Ad Network

Australia is primed for the rise of the premium Ad Network. Like SEM it is the one area that has massive growth opportunities with agency-scale advertisers and is a relatively clean space in most instances.

One thing Ad Networks do well is get local advertisers on high quality, premium international sites with strong and loyal AU IP eyeballs. Think tripadvisor, last.fm, Mini Clip, iVillage ... these are category leading sites who are on the bleeding edge of innovation and have strong brands that users identify with. What these sites allow marketers to achieve is more thorough presence in relevant areas and improved overall reach. They give the advertiser more choice. As the web becomes more mainstream these international sites will become more well known (as Google has more and more say over what is deemed as most relevant) and marketers will expect their agencies to be evaluating them against the big 5's options.

As someone who puts together digital strategies for clients, the more choice I have to evaluate the more confident I am in that I am answering the brief in the best possible way.

On top of this is Ad Networks can help advertisers get on premium local sites without dedicated representation for sales. Again, this is very liberating for advertisers as it offers even more choice, more eyeballs, more options.

What has been great this year has been a much more concerted push by the Ad Networks to offer further value. Primarily in the areas of selling a network of sites across specific categories and also offering sophisticated targeting options.

Category or vertical based ad networks are fantastic as they offer the advertiser the chance to reach a wider group of consumers across a wider variety of sites, but have control over the sites they choose and the ability to tailor a message to the context. Platform 9's content network as well as the Google Content Network are great examples of this and provide the opportunity to reach potentially a brand new audience in environments they trust. The key attractions here are reach, cost and relevance. Reaching a SME in a relevant environment used to cost you upwards of $60CPM ... now you can reach them for $6 with higher reach and response. Tempest's affiliation with Glam Media now means there are now 100+ odd additional options as well as using Vogue.com.au to reach this audience. Our reliance on a selected number of sites has been removed - in essence, restoring the balance and nurturing a health digital ad market.

And you can get quite specific with some the networks.

If I'm looking for people who are involved in grassroots local football leagues on the Eastern Seaboard I can now target them with minimal wastage. A few years back this would have been a costly and labour intensive exercise ... now thanks to a smartly crafted network I can pinpoint this audience. A premium Ad Network has aligned a large number of small grassroots sports sites (think sporting clubs, facilities etc) to create a impressively sized audience with new to market targeting options. Not a bad option for a football boot if they can target those people who are playing in a local football league within a relevant environment.

These areas offer a lot of value as they allow you to tap into consumers 'passion points' (for want of a better term) online. And they do it in a way that offers the advertiser the opportunity to manage the activity in terms of trafficking, reporting and billing just like a major local network.

What does this mean? It means the big 5 aren't really competing against eachother anymore, they're competing against hundreds of thousands of sites who now are equipped to service Australian advertisers and organised sufficiently to deliver.

Combine these audiences and numbers wise they offer the opportunity to reach equal or better volumes to the major networks ... which for the advertiser is a massive positive. It by no means replaces the need to consider larger networks, it moreso gives one more options to consider and allows for innovative ways to use the two in combination.

Then there's behavioural targeting/retargeting ... different concepts but essentially both have the same intent: utilising technology to serve more relevant ads to consumer. With sufficient networks behind them both of these formats are exciting as they offer another area to add to the digital mix. Yes, some of the main networks are playing in this space (Yahoo and Media Smart in particular) however they are competing against some strong players (such as AdConion).

Begs the question, maybe instead of investing in systems to monetise their remnant inventory some of the major publishers (aside Media Smart who already play in this space) should have been looking to extend their reach and relevancy in key high yield areas by providing local representation to premium smaller sites?

More options, more sites, more contexts, more executions, more reach - all things that can benefit the entire industry.

And lets not forget that it is now entirely viable for advertisers to CREATE the content and with digital the reliance on publishers for eyeballs and engagement is decreasing ... but that's a whole other topic.

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