Traditional media companies trying to stem the flow of advertising dollars to Google and other large Internet companies are increasingly building ad networks of their own, anchored by their brands.
The latest, Forbes Inc., announced that it will soon start selling ads for about 400 financial blogs. In recent months, Conde Nast, Viacom Inc., CBS Corp. and other major media companies have unveiled topic-specific ad networks to lure advertisers that want to buy more ads than any single site can sell.
If newspapers, magazines and broadcasters cannot expand online ad inventory, they are “under threat of becoming less and less relevant to the advertiser,” said Russ Fradin, chief executive of Adify Corp., whose technology runs ad networks for Forbes and others.
But these media networks, some linking fewer than a dozen hand-picked Web sites may have a tough time competing with the larger networks of thousands assembled by Google Inc., Yahoo Inc., Microsoft Corp. and Time Warner Inc.’s AOL.
Those companies have been expanding, too, spending at least $11 billion collectively to buy smaller ad networks and technologies and in Microsoft’s case, also bidding more than $40 billion for Yahoo.
“As our technology has continued to advance, we’ve gotten better and better,” said Lynda Clarizio, president of AOL’s emerging Platform A advertising unit. “We can handle a lot of demand from advertisers.”
Advertisers prefer dealing with networks rather than individual web sites
The expansion drive by both sides comes as Internet users increasingly divide their time across scores of sites large and small. Advertisers would rather not deal with thousands of individual Web sites. Media companies and Internet portals alike are promoting networks as a way to reach larger audiences with “one-stop” ad buys.
So far, portal ad networks have largely succeeded in selling their affiliates’ leftover ad inventory at discounted rates and sharing revenue. By employing targeting techniques like matching ads to visitors’ surfing habits, those large networks are stepping up bids for higher-value ads , ones that have traditionally gone to sites run by media companies.
Small networks under pressure to sell to larger networks
Accustomed to selling ads on their own in offline channels, many traditional media companies have been resisting overtures to join larger networks.
“One of the big ones said to us, ‘You guys are really good at creating content and we are really good at selling advertising. It would be perfect,”’ said Sarah Chubb, president of Conde Nast’s online division, CondeNet, which has signed up a handful of blogs on fashion and technology. “We’re pretty good at selling advertising, too.”
Smaller networks can offer advertisers a consistent audience on pre-approved sites, while giving those sites individualized attention.
“Forbes understood our business,” said Steve Woit, publisher of Xconomy, a blog joining the Forbes network. “A larger network, whether it’s Google or others, has to deal with every industry and large consumer sites.”
Rather than join large networks, Martha Stewart Living Omnimedia Inc. figures it is better off recruiting one or two dozen leading lifestyles sites that meet its editorial standards and selling higher-priced ads to Macy’s, Ace Hardware and other brands. Martha’s Circle launched in November.
Ad partnerships with indepdendent parenting sites
Viacom’s MTV and Nickelodeon have ad partnerships with independent parenting sites and are launching groups this spring around music and men’s lifestyles. CBS announced last week several local ad networks around CBS-owned stations.
Other media companies are forming networks among themselves. In February, Gannett Co. and Tribune Co., the two largest US newspaper publishers, joined Hearst Corp. and New York Times Co. to form QuadrantOne to collectively sell online ads. On Thursday, QuadrantOne said another 26 newspaper companies have joined.
Operators of the larger networks, however, say smaller networks can never produce on the scale advertisers are seeking. Todd Teresi, a Yahoo senior vice president, said the media companies’ efforts are a “valid path to go, a first step.”
Bunch of blogs too cannot compete with large internet companies
But even if a media company can assemble 10 or 20 like-minded blogs, he said, overall traffic wouldn’t be growing as much compared with what a large Internet company can offer.
Forbes is initially looking to increase business by just 10-15%, even with hundreds of bloggers. In mid-March, Washington Post Co. ended its 16-month-old ad network because many advertisers had cheaper options through the large portals and blog-specific networks like Blogads.
“We were holding out for value but there was too much inventory,” said Jeff Burkett, director of ad innovation with the Post’s interactive unit.
Instead, the Post hopes to increase ad opportunities by boosting traffic. For starters, it plans to start carrying items from the PaidContent blog and will likely share ad revenue.
Yet media companies are finding their own networks hard to resist, even if they join the larger efforts. MSNBC.com, a joint venture between General Electric Co.’s NBC and Microsoft, uses Microsoft’s ad technology and sales teams but also recently formed networks around politics and the female-heavy “Today” show.
“We can’t match what Microsoft does, ... but they represent a lot of different products,” said Kyoo Kim, vice president of sales with MSNBC.com. “We want to make sure we protect our brand and be in charge of our own destiny as well.”
Tuesday, March 25, 2008
In-game advertising has become more popular
While football videogames have long featured ads on billboards around the perimeter of the pitch, now targeted ads can be served. These can be tailored by a user’s geographic location and demographic profile, offering advertisers the chance to access a unique target audience.
Jean-Paul Edwards, head of OMD Media Futures at Manning Gottlieb OMD, says it is not hard to see why brands like in-game advertising. ‘What is interesting is that it demands the consumer’s attention, because if they are not concentrating on the game, they will die, crash, lose or whatever. In this media-fragmented world, where it is hard to capture people’s attention, that is not something that is easily sniffed at,’ he says.
However, while there is no doubt that in-game advertising has become more sophisticated, many believe the techniques employed to measure its effectiveness have failed to keep pace. The sector still does not have an independent, thirdparty auditing system in place.
IGA was one of the first companies to see the potential of dynamic in-game advertising. The company currently has more than 15m unique users in its network, and, according to Ed Bartlett, cofounder and vice president, publisher relations, this number is growing rapidly.
He agrees that the sector is now mature enough for independent auditing, but rejects any suggestions that dynamic in-game advertising is not accountable enough to justify the hype surrounding it. ‘The measurement that clients get from us is a lot more robust than they receive from a lot of above-theline media,’ says Bartlett. ‘It offers something with levels of accountability similar to those of below-the line activity.’
IGA’s system measures the time, size and angle of exposure to in-game advertising. Users have to see ads at a given size and angle for 10 seconds for it to register an impression. Ads are then billed on a CPM (cost per 1000 impressions) basis. Other ingame ad specialists, including Double Fusion and Microsoft’s Massive, take a different approach.
They also require a user to have seen an ad for 10 seconds, but allow this period to be made up of half-second units, meaning that an impression can be registered when a gamer sees an ad on one occasion for 10 seconds, or glimpses it on 20 occasions for only half a second each time.
‘Research confirms that to read and recognise a billboard or a texture usually takes a third of a second , so we have set it at half a second to allow plenty of time,’ says Frank Sagnier, Double Fusion’s senior vice president, business development.
According to Sagnier, interest in dynamic ingame advertising has grown significantly over the past two years. ‘We are seeing a number of global brands adopting it and investing more in it,’ he says, adding that sports, automotive, lifestyle and entertainment brands are particularly enthusiastic.
As brands increase their investment, accountability will become more of an issue, but the technology to measure click-through is already there. ‘The issue is that most publishers would be reluctant to let people click away from the game and disrupt the experience,’ says Sagnier. ‘Perhaps it would work for causal games, but not for something like Grand Theft Auto.’
Meanwhile, Bartlett claims that in-game ad networks already have a huge volume of research at their disposal from the games publishers themselves. ‘When a publisher is spending £10m on a game, it collects a wealth of data on the users, so it can say to advertisers, “These are the types of people we are targeting and here are the impressions we deliver” .’
According to Dave Hompe, group media director at digital network Isobar, the issue with in-game ad measurement is the same one that affects all online advertising. ‘In the TV market, everything is compared to the relevant impact of a 30-second spot. We do not have those multipliers for impressions, either for gaming or for standard online advertising. That kind of insight just isn’t available,’ he says.
Hompe adds that a lot of brands and companies are starting to see this as a challenge. ‘The first stage is when clients say, “Let’s assess relative efficiency for $1 invested in TV versus online versus in-game advertising.” This is the ultimate prize. We are probably not at the point yet where can make that assessment, but we can see there is an absolute value in using multiple channels for campaigns. The tricky part is finding the right balance,’ he says.
As levels of broadband penetration and connection speeds increase, and tech-savvy kids grow into tech-savvy young adults, it is hard to see online gaming’s fortunes going any way but up. Provided the market research industry, games publishers and in-game advertising networks can work together to develop the channel, it seems the in-game medium
is destined to follow suit.
Paul Milsom, new media analyst at British Market Research Bureau (BMRB), believes that for brands to invest in in-game advertising, games publishers and networks should provide three broad types of research information . They should offer a count of unique users, which is likely to be provided by web-based metrics similar to ABC Electronic’s unique-user measure for website traffic.
Demographic profiling of the game’s audience will also be essential for the advertiser to incorporate interactive entertainment into a campaign. Decision-making on any media channel , including online games, must also be enhanced with the addition of lifestyle information. ‘It remains to be seen how this type of information will be delivered, but it could be provided by a global audience panel, or by survey research,’ says Milsom.
Impact on brand perceptions
Researchers examined three in-game campaigns, for Nike 6.0, Samsung Mobile and Sure for Men. ‘We carried out pre- and post-evaluation as we would on other platforms,’ says Griffiths. ‘Brand awareness had not risen in the post-campaign analysis, but we did see changes in the perception of the brands, indicating that the in-game platform works well when coupled with existing campaigns.’
Griffiths believes the study marks the beginning of research in this field. ‘I don’t believe there are many agencies in the world that are any further down the line with this, because until now the industry has not been ready. The time is now right for the market- research world to pay attention to this medium and start looking at innovative ways in which we can track it.’
TNS believes that when analysis of players’ activity within a game is combined with external research on media consumption, attitude to the brand, propensity to purchase and actual purchasing behaviour data, the research industry will be able to prove the effectiveness of the advertising.
Jean-Paul Edwards, head of OMD Media Futures at Manning Gottlieb OMD, says it is not hard to see why brands like in-game advertising. ‘What is interesting is that it demands the consumer’s attention, because if they are not concentrating on the game, they will die, crash, lose or whatever. In this media-fragmented world, where it is hard to capture people’s attention, that is not something that is easily sniffed at,’ he says.
However, while there is no doubt that in-game advertising has become more sophisticated, many believe the techniques employed to measure its effectiveness have failed to keep pace. The sector still does not have an independent, thirdparty auditing system in place.
IGA was one of the first companies to see the potential of dynamic in-game advertising. The company currently has more than 15m unique users in its network, and, according to Ed Bartlett, cofounder and vice president, publisher relations, this number is growing rapidly.
He agrees that the sector is now mature enough for independent auditing, but rejects any suggestions that dynamic in-game advertising is not accountable enough to justify the hype surrounding it. ‘The measurement that clients get from us is a lot more robust than they receive from a lot of above-theline media,’ says Bartlett. ‘It offers something with levels of accountability similar to those of below-the line activity.’
IGA’s system measures the time, size and angle of exposure to in-game advertising. Users have to see ads at a given size and angle for 10 seconds for it to register an impression. Ads are then billed on a CPM (cost per 1000 impressions) basis. Other ingame ad specialists, including Double Fusion and Microsoft’s Massive, take a different approach.
They also require a user to have seen an ad for 10 seconds, but allow this period to be made up of half-second units, meaning that an impression can be registered when a gamer sees an ad on one occasion for 10 seconds, or glimpses it on 20 occasions for only half a second each time.
‘Research confirms that to read and recognise a billboard or a texture usually takes a third of a second , so we have set it at half a second to allow plenty of time,’ says Frank Sagnier, Double Fusion’s senior vice president, business development.
According to Sagnier, interest in dynamic ingame advertising has grown significantly over the past two years. ‘We are seeing a number of global brands adopting it and investing more in it,’ he says, adding that sports, automotive, lifestyle and entertainment brands are particularly enthusiastic.
As brands increase their investment, accountability will become more of an issue, but the technology to measure click-through is already there. ‘The issue is that most publishers would be reluctant to let people click away from the game and disrupt the experience,’ says Sagnier. ‘Perhaps it would work for causal games, but not for something like Grand Theft Auto.’
Meanwhile, Bartlett claims that in-game ad networks already have a huge volume of research at their disposal from the games publishers themselves. ‘When a publisher is spending £10m on a game, it collects a wealth of data on the users, so it can say to advertisers, “These are the types of people we are targeting and here are the impressions we deliver” .’
According to Dave Hompe, group media director at digital network Isobar, the issue with in-game ad measurement is the same one that affects all online advertising. ‘In the TV market, everything is compared to the relevant impact of a 30-second spot. We do not have those multipliers for impressions, either for gaming or for standard online advertising. That kind of insight just isn’t available,’ he says.
Hompe adds that a lot of brands and companies are starting to see this as a challenge. ‘The first stage is when clients say, “Let’s assess relative efficiency for $1 invested in TV versus online versus in-game advertising.” This is the ultimate prize. We are probably not at the point yet where can make that assessment, but we can see there is an absolute value in using multiple channels for campaigns. The tricky part is finding the right balance,’ he says.
As levels of broadband penetration and connection speeds increase, and tech-savvy kids grow into tech-savvy young adults, it is hard to see online gaming’s fortunes going any way but up. Provided the market research industry, games publishers and in-game advertising networks can work together to develop the channel, it seems the in-game medium
is destined to follow suit.
Paul Milsom, new media analyst at British Market Research Bureau (BMRB), believes that for brands to invest in in-game advertising, games publishers and networks should provide three broad types of research information . They should offer a count of unique users, which is likely to be provided by web-based metrics similar to ABC Electronic’s unique-user measure for website traffic.
Demographic profiling of the game’s audience will also be essential for the advertiser to incorporate interactive entertainment into a campaign. Decision-making on any media channel , including online games, must also be enhanced with the addition of lifestyle information. ‘It remains to be seen how this type of information will be delivered, but it could be provided by a global audience panel, or by survey research,’ says Milsom.
Impact on brand perceptions
Researchers examined three in-game campaigns, for Nike 6.0, Samsung Mobile and Sure for Men. ‘We carried out pre- and post-evaluation as we would on other platforms,’ says Griffiths. ‘Brand awareness had not risen in the post-campaign analysis, but we did see changes in the perception of the brands, indicating that the in-game platform works well when coupled with existing campaigns.’
Griffiths believes the study marks the beginning of research in this field. ‘I don’t believe there are many agencies in the world that are any further down the line with this, because until now the industry has not been ready. The time is now right for the market- research world to pay attention to this medium and start looking at innovative ways in which we can track it.’
TNS believes that when analysis of players’ activity within a game is combined with external research on media consumption, attitude to the brand, propensity to purchase and actual purchasing behaviour data, the research industry will be able to prove the effectiveness of the advertising.
What Gandhi can teach us about advertising
Most people picture Mahatma Gandhi as some gentle, fragile man who people followed because he was just so peaceful. Gandhi wasn'''t an idle peacenik; he was a perceptive communicator who would have been right at home in today's ad industry.
But the truth is he wasn’t just some sappy dude who sat around all day smiling. He was a sharp lawyer who had a mind for smart communication. He was non-violent, but not passive. He devastated an empire by taking residence in people’s minds. He knew how the media worked and how to get attention. He spread his message by causing peaceful civil disobedience that got talked about in international press and word of mouth. That’s the power of a story worth discussing.
His famous salt march was done explicitly to get noticed. He made a small batch of salt, which was illegal for him to do under British rule. The salt he made wasn’t worth much, but the press couldn’t help but write about his defiance.
In less noble ways perhaps, advertising does the same thing for brands. It finds the inner story of the product and causes some civil disobedience (guerilla marketing, breakthrough thinking, press-worthy work), for the betterment of the brands. Calling out the tyranny of competitors and marking their own righteous deeds. Anything that gets people talking, the news writing or the schoolyard buzzing.
3M spent next to nothing installing a bus shelter with thousands of dollars locked under security glass, free to anyone who could get it. By inviting the public to attack the shelter they received incredible attention.
Most good advertisers know this. The advertising agency Crispin Porter + Bogusky even writes ideas in the form of what the press release might say.
Others need to be reminded. If you don’t create a stir with your adverts, you’re not really doing much. And if clients aren’t prepared to be shocked on occasion, they’re setting themselves up to be overthrown by some small witty brand in modest cloth.
But the truth is he wasn’t just some sappy dude who sat around all day smiling. He was a sharp lawyer who had a mind for smart communication. He was non-violent, but not passive. He devastated an empire by taking residence in people’s minds. He knew how the media worked and how to get attention. He spread his message by causing peaceful civil disobedience that got talked about in international press and word of mouth. That’s the power of a story worth discussing.
His famous salt march was done explicitly to get noticed. He made a small batch of salt, which was illegal for him to do under British rule. The salt he made wasn’t worth much, but the press couldn’t help but write about his defiance.
In less noble ways perhaps, advertising does the same thing for brands. It finds the inner story of the product and causes some civil disobedience (guerilla marketing, breakthrough thinking, press-worthy work), for the betterment of the brands. Calling out the tyranny of competitors and marking their own righteous deeds. Anything that gets people talking, the news writing or the schoolyard buzzing.
3M spent next to nothing installing a bus shelter with thousands of dollars locked under security glass, free to anyone who could get it. By inviting the public to attack the shelter they received incredible attention.
Most good advertisers know this. The advertising agency Crispin Porter + Bogusky even writes ideas in the form of what the press release might say.
Others need to be reminded. If you don’t create a stir with your adverts, you’re not really doing much. And if clients aren’t prepared to be shocked on occasion, they’re setting themselves up to be overthrown by some small witty brand in modest cloth.
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