Internet Reshapes Role of Media Buyers

WPP's Gotlieb Is Wary Over Proposal to Open Ad-Sales Marketplace

By SUZANNE VRANICA
February 28, 2007; Page B3

About 1,500 advertising and media executives are gathering in Las Vegas today for the ad industry's big annual conference of media buyers, the people who help marketers choose and purchase ad time and space on different media outlets. With the Internet and other new digital technology forcing the ad industry to rethink age-old ways of operating, this year's meeting promises plenty of intense debate.

Once a relatively pedestrian function on Madison Avenue compared with the glamorous creative jobs, media buying has become a critically important role since the Internet and other digital media have exploded the variety of media outlets available for marketers. But not all the changes flowing from digital technology are as welcome. A push by several advertisers for the creation of an online ad-sales marketplace, run by eBay, has proved controversial on Madison Avenue and is likely to be among issues discussed this week.

One of the most powerful media-buying executives in the industry is Irwin Gotlieb, chief executive of Group M, a unit of WPP Group that houses various media services firms including Mindshare and Mediaedge:CIA. Group M-owned firms account for about $40 billion in annual spending on ad time and space around the globe. Below, Mr. Gotlieb talks about developments in the industry.

Wall Street Journal: Much noise has been made about the eBay Media Marketplace, the online system that a group of advertisers hope could make ad sales more transparent. No network has agreed to participate, which casts some doubt on the plan. Why is there so much fear about the idea?

Mr. Gotlieb: A lot of media transactions are complex and don't lend themselves to the kinds of restrictions or constraints that exist when you try to do something through an exchange or auction. ... We very often deal with each vendor separately because each has different circumstances. What is feasible with one may not be with another. There may be a price adjustment that is factored into your negotiations. ... You can't line these deals up so they are identical.

The second element is that we are a business where personal relationships have real impact. Trust and reputation have a lot to do with these transactions. You have to sit down and look someone in the eye and agree. ... We are a business where we know each other and we live up to our deals, and very often one has to sit across from each other to get this done, and I am not sure I want to do that across the platform. Still, if I have to buy 100 spots in 150 of the smallest markets in the U.S. and it's just a volume thing, would I like an exchange to facilitate? Of course; there is a place for all these things.

WSJ: What's your opinion on the system being developed?

Mr. Gotlieb: I would welcome various automated models for this area where we do high-volume transactions. ... I would not welcome these platforms in these areas where we are retained by our clients to ensure they have an advantage and where these platforms level the playing field for all players. Frankly, I have no interest in playing on a level playing field.

WSJ: Last year's "upfront" negotiations were stalled because of the argument over how to value viewers who watch TV shows on digital video recorders. Did that standoff help media buyers get better pricing?

Mr. Gotlieb: What happened last year had little to do with marketplace standoffs, but it had everything to do with a need for a resetting of the marketplace. Historically, there has been a need for the upfront to be favorable to long-term players -- otherwise why make an early commitment that ties you up? If you can buy it later for less, why buy it now? There is an underlying implication that the upfront must be favorable.

In the prior two years, the marketplace had allowed that balance to go slightly the wrong way. It got precariously close to being near parity. So the marketplace needs an adjustment that provides benefit to the long-term players. ... Last year's demand didn't grow at rates that had been hoped for, and the industry took an opportunity to rebalance the relationship between long-term pricing and the short-term pricing.

WSJ: The drumbeat from ad firms about taking back planning duties from the media firms continues to percolate. What is your position on media planning duties and who should own them?

Mr. Gotlieb: I hate to stoop to this. I am reluctant to allow this to degenerate into a catfight. This is not about slugging it out over who does media. It is about how we collaborate and do the best possible work for our clients.

From a structural standpoint, clients made a decision to separate media implementation, what most call media buying, into [an] agency-of-record structure. They did that because by consolidating the volume, they get better deals. ... Any procurement guy will tell you that you are foolish if you do not consolidate that stuff. ... Martin [WPP Chief Executive Martin Sorrell] said a couple of years ago, "Stop talking about it, because the toothpaste is out of the tube, and we can't put it back."

Yahoo Ad-Ranking Tool Clicks With Online Users

By RIVA RICHMOND

February 28, 2007; Page B3D

Web surfers are clicking on Yahoo Inc. search-related advertisements with increasing frequency following the introduction of a new ad-ranking system, a boost to the Internet company's hopes of improving its lagging revenue growth.

According to a report from research firm comScore Networks Inc., Yahoo's Feb. 5 launch of a new method for ranking search ads -- a system like that used by rival Google Inc. that rewards ad quality in addition to the ad's price -- has drawn a quick and positive response from consumers.

ComScore said the rate at which consumers clicked on Yahoo search ads rose 5% in the week ended Feb. 11 and 9% the next week, compared with the week ended Feb. 4. The improvement is important because Yahoo only collects money on ads, the price of which are set in online keyword auctions, when a consumer clicks on the ad and visits the advertiser's Web site.

"They promised an increase, and we're definitely seeing it in the data," said James Lamberti, a senior vice president at comScore. "We're talking about a volume of click activity that's massive... . To move that needle even 5% or 10% is significant."

A spokeswoman for Yahoo, of Sunnyvale, Calif., said in an email that the company believes its new system, called Panama, is "creating a more relevant search experience for our users and more value for our advertisers and publishers. We're very pleased with the positive results and advertiser response we've experienced to date.

"However, we're still in the early stages and continue to learn and fine-tune our system and ranking model."

Because the average cost of Yahoo's clicks could have changed with the new system, the increased number of clicks might not mean more revenue for Yahoo immediately, Mr. Lamberti cautioned. Yahoo has predicted Panama won't help its financial performance until the second quarter, when advertisers will have had time to get comfortable with the new system and adjust their strategies.

Yahoo's new system determines ad placement based on an assessment of quality that includes the ad's click-through rates and other factors as well as its bid price, rather than bid price alone. Therefore, cheaper ads may move higher and attract more clicks and more expensive ads may drop and get fewer clicks, hurting Yahoo's average cost per click. Eventually, higher quality and click-through rates should attract higher bids and more advertiser spending, lifting Yahoo's revenue.

ComScore also said consumers are more often clicking on Yahoo ads instead of the "natural" results of their search, which are the standard, free results engines provide based on an assessment of relevancy alone. Ads accounted for 10.6% of total clicks in the week ended Feb. 11, up a half point from the period before the ranking-method change, and rose another half point in the week ended Feb. 18 to 11.1%, comScore said.

The figures suggest Yahoo is on the road to improved revenue per search, a metric that has been a focus for investors concerned about a widening gap with Google in the ability to harvest revenue and profit from Web search.

Panama involved first moving marketers onto a new and more sophisticated platform for managing their ad campaigns and then implementing the new ad-ranking algorithm.

Google has the search industry's highest click-through rates, both for ads and for standard search results, said Mr. Lamberti, but "Yahoo has definitely narrowed the gap." He declined to provide comparative click-through data for Yahoo and Google.

Google is consumers' favorite search engine and has been stretching its lead. It handled 47.5% of all queries in January, compared with 28.1% for Yahoo and 10.6% for Microsoft Corp.'s MSN, according to comScore.

The Attention Economy: Is the Marketing World Ready for a New Consumer Culture?

ADOTAS
February 28, 2007
By Joseph Matheney

I look forward to a world where consumer data is harvested with permission, where the consumer has the option of assigning permission levels to their day, habits and data segments and look forward to the fair practice of compensating consumers for their attention data. I look forward to Attention Data Exchanges, consumer groups (think mutual fund) and segments being traded under symbols such as: BMR, SWF, BMM, APF, etc. Why do I look forward to this? Because it removes so many barriers to solutions.

One of the biggest side effects to the ‘AlwaysOn’ effect is dataglut. Too much data, not enough bandwidth to triage it all, let alone sort it for relevance in real-time. What will alleviate this problem is behavioral, contextual, inference and relevance engines. The technology itself already exists in some rather sophisticated forms and even more elegant iterations are coming out of R & D as you read this.

The technology is not the hurdle now, perception is. Granted, consumer suspicion regarding intention, integrity and security of their data considering the shoddy track record that on-line data tracking has with consumer. To that point, the first order of business with data managers is winning back the trust of consumers. A good beginning towards that end can be found at www.attentiontrust.org. As this market matures, more standards committees and consortiums will be formed and best practices as well as policing agencies will emerge. These are all good things for both the industry and the consumer.

As trust and accountability increase, consumer comfort will increase, following that participation in AD programs will increase. As consumers discover that participation not only evolves their ‘interruption’ marketing experiences into ‘participation’ marketing experiences, but is a profitable paradigm as well. Ads that carry real-time relevance to a consumer’s life are no longer viewed as interruption, but rather views as information. This natural evolution will also enhance the relationship between producers and consumers, as well as diminishing the waste of scattershot approaches and volume messaging distribution.

As targeting gets better with time, a natural evolution, marketing and advertising itself will change fundamentally. Now, ads are offers that are delivered when invoked by the proper alignment of profiling information, time windowed behavioral statistics, contextual trails and situational relevance. No more ads produced and left at ‘strategic’ spots on a suspected trail. Now ads are built organically, dynamically, responsively (not reactively), and in real-time from a dynamic line up of assets, profiles, contexts and relevance scenarios. See why this ‘oh-so-near’ future makes me wriggle and pant?

My only concern is that bigger and better solutions always bring with them bigger and bolder opportunities for abuse. Unfortunately, the human race has both a light and a shadow side. The hacker in me says that abuses will only cause us to think of better and more secure means of conducting business in this brave new world, and that side of me is right, but that doesn’t ease the pain of people that become collateral damage in the infowars. We must always remain mindful that ‘consumers’ and ‘users’ are people and that in our zeal to deliver better solutions, that we don’t confuse ‘better’ technically for ‘better’ in a quality-of-life enhancing way. Because quality of life is what it’s all about.

Until next time, happy networking.

Mobile Social Networking Opens The Door For Advertisers

by Cory Treffiletti, Wednesday, Feb 28, 2007 4:00 PM ET
http://publications.mediapost.com/?fuseaction=Articles.showArticle&art_aid=56293

MOBILE SOCIAL NETWORKING -- I have to admit that this one takes me a little by surprise, but only because I hadn't thought of the implications and the ways that it could be used. It hit me while I was flying this week to Orlando for a series of meetings and catching up on the reading I let pile up while I was busy the previous week. Time magazine, my continued source for the establishment of mainstream thinking, wrote an article concerning mobile social networking and some of the tools being developed to allow customers to keep tabs on their friends using mobile GPS devices and software integrated into their cell phones.
The part of the article that woke me up was the part about the guy who checked in on his roommate, saw that she was at Wendy's, so he called her up and asked her to pick up some 99-cent chicken sandwiches. That single sentence launched a plethora of epiphanies in my head and probably the heads of many other entrepreneurial advertising execs. There was finally a concept that resonated in the mind of the consumer with an obvious marketing extension.
To date mobile has been a category all about promise. There is the impending promise that carriers are seeking out ways to monetize their customer base further -- and with decreasing sales for new handsets, the only options they have are increased data services or advertising. While data services are certainly important, they will undoubtedly become cheaper in the coming years because no one (myself included) wants to spend $200 per month on their cell phone.
Advertising is certainly inevitable in the mobile environment, but it's a pickle to figure out how and where. Users don't like the intrusive nature of push ads displayed on their phones, plus they cost money to receive, which can be a nightmare of consumer backlash. These mobile social networking opportunities finally present something that can be used for marketers to tap into a customer's mindset.
The obvious opportunities are those where consumers can identify some of their favorite brands -- and their phones could alert them whenever they are in proximity to those brands. For example, are you a BMW fan? If so, the phone could alert you whenever you're near the BMW dealer with the new 6-series. Are you a Burger King guy? If you are near a BK, say within ½ a mile, your phone could ping you to let you know! Are you a mom with kids eight to 10 years old? Then your phone could ping you to let you know that there's a Chuck E Cheese just around the corner, and they have a special today!
The slightly more advanced opportunities would be for the phone to become a true "smartphone," where it learns the people you call, keeps track of these people, and applies this information to your GPS map. For example, if you regularly call your friend at 555-1234, then the phone may let you know that your friend is at Safeway or is around the corner from you. If you typically call the doctor because you're a hypochondriac, then maybe the phone will alert you the fact that Safeway is having a sale on vitamins. Of course, you would have to initiate these types of services, unless the carrier just decided these would become standard with your service, for a reduced monthly charge, of course.
For these ideas to truly become commonplace, the next generation of phones will still need to step up. The interface still needs to improve and the delivery speeds for data services will still need to accelerate. That will happen, certainly by next year, and possibly by June when the Apple iPhone finally comes out -- provided it's not nearly as buggy as some people are saying.

Advertisers to get more control over contextual ad campaigns

Advertisers to get more control over contextual ad campaigns
Brand advertisers are to get a boost with the advent of new contextual advertising models.
by Helen Leggatt

Google will soon enable their advertisers to bid on contextual ads on pre-selected websites. The new function will give advertisers more control over the quality of websites on which their brands will appear, the current AdSense model does not allow for this level of refinement and nor does Microsoft's AdCenter or Yahoo's Search Marketing.
But Quigo, a New York-based start up, is already taking contextual advertising up a notch. Not only can they provide brand advertisers with the assurance of being seen where they dictate by bidding for placements on specific sites, they can also filter out undesirable websites and receive reports on the effectiveness of individual placements.
Another attraction for advertisers is that Quigo's branding doesn't appear on any of the ads it serves.
It’s about time that Google and Yahoo had some stiff competition. Whilst Quigo controls less than 10 percent of the contextual ad market, it has been attracting some big names. Over the last eighteen months, companies such as ESPN, Cox Newspapers, FoxNews, CareerBuilder.com and, most recently, Forbes.com have moved their business to Quigo. Jim Spanfeller, Forbes.com’s chief executive, said that leaving Google for Quigo was “a dollar-and-cent thing.”
Google appear unruffled. Kim Malone, director of online sales and operations for AdSense, said they have “a large number of publishers who have tried out other solutions, and they have always come back.”

Forrester: Clients Believe Shops 'Unprepared'

February 27, 2007
By Kathleen Sampey

NEW YORK Clients view traditional ad agencies as being particularly unprepared to understand the changing ways consumers use media and technology, according to a new survey conducted by Forrester Research.

Still, of the agency executives surveyed, 93 percent of them thought their efforts "drive their clients' marketing success," while just 63 percent of the marketing executives contacted agreed, the survey revealed.

The company surveyed 141 executives on the agency and client sides to gauge perceptions on various aspects of the relationship.

The findings revealed divergent points of view between the two parties, with agencies overestimating their value in helping clients achieve their business goals.

The gap in perception was most pronounced when each side was asked how equipped the ad agencies were in dealing with changes in Internet advertising and consumer behavior. About 95 percent of agencies thought that they were well positioned to adapt to changes in Internet advertising while only 45 percent of clients agreed.

Less than 60 percent of clients thought agencies could help them deal with changes in consumer behavior while 80 percent of agencies thought they were well prepared to do so.

The report also cited a role reversal of sorts between so-called "traditional" agencies and digital shops. The latter saw a spike in demand during the dot-com bubble from 1999-2001 as clients scrambled to develop Web sites for their brands.

They have since seen resurgence as clients are shifting more dollars towards digital shops, with some, such as Agency.com and AKQA, doing TV ads for Ikea and Yell.com, respectively.

Interactive and digital advertising was the area for which most clients sought specialty agencies, the report said. Social media and ethnic marketing were the areas in which outside specialists were least sought by clients.

Of the survey participants, only 15 percent said their agency compensation was tied to business results. When those who did not have such an arrangement were asked why, 43 percent said they never considered it while 36 percent reported it would be too difficult to truly measure the results.

The results were summarized in a report titled, "Help Wanted: 21st Century Agency."

Forrester: Clients Believe Shops 'Unprepared'

Forrester: Clients Believe Shops 'Unprepared': "Forrester: Clients Believe Shops 'Unprepared'
February 27, 2007
By Kathleen Sampey


NEW YORK Clients view traditional ad agencies as being particularly unprepared to understand the changing ways consumers use media and technology, according to a new survey conducted by Forrester Research."

Vantage Media Corp. has raised a mammoth $70 million Series A funding.

In the largest first round financing in nearly two years, search-engine marketing company Vantage Media Corp. has raised a mammoth $70 million Series A funding.

Montgomery & Co. led the round with $25 million, said Montgomery Chief Executive James Montgomery, who added that while the funding is technically a Series A round, he considers the investment more of a private equity play. Montgomery acquired a majority stake in Vantage, though the firm would not disclose specifics.

Other investors are Scale Venture Partners, Tudor Ventures and Integral Capital Partners.

"It will easily be a $200 million company in revenue in the next couple of years," said Steve Jillings, who was named chief executive in the funding announcement.

Founder and President Mark DiPaolo said Vantage, which performs customized, search-based marketing leads and search campaigns for educational institutions, has been profitable from its start in 2002 and said the company, with 50 employees, brings in revenue of roughly $1 million per working head

Measuring the Invisible

FEBRUARY 28, 2007
Q: What is the ROI of advertising?

A: Stop advertising and find out.

Marketers know that they have to advertise, but many are dissatisfied with advertising's return on investment (ROI) — even though most of them do not measure it anyway, according to a new study by Forrester Research.

Marketers were asked how likely they were to recommend a particular product or service. The aggregate rating for ad agencies was 21%, meaning that very few clients would recommend their agencies' services to others.

The flip side is that 76% of marketers had no way to determine their ROI from their lead agencies, and 69% said ROI is too difficult to measure.

"There's always an undercurrent of discontent with agencies," said Peter Kim of Forrester. "They're dissatisfied, yet on what basis? It's not because the agency didn't help them drive sales or meet some other business outcome. It's a vague disenchantment, or disappointment; it's a feeling that there isn't data to back up."

Marketers aren't the only ones pining for more data. A new joint survey by NSON Opinion Research and the Audit Bureau of Circulations of online ad planners and buyers revealed a strong desire for independent verification of new media ad metrics.

Three-fourths of North American ad professionals said that they would be more likely to advertise on Web sites if the results were independently verified by a third party.

Less than half of advertisers and agency professionals said that they trusted online publisher metrics.

And more than two-thirds of respondents said that they preferred advertising on audited Web sites when possible.

There is good news for agencies. For one, they are still responsible for nearly 60% of ad spending. Plus, firms are always creating more data to meet demand. In traditional media, Nielsen//NetRatings recently started tracking TV viewing by college students. On the new media side, Podtrac just released a media planner for would-be podcast advertisers.

iLike Growing Quickly, Still Massively Trailing Last.fm

Later today music social network iLike will report that they’ve reached half a million registered users in the first four months since launching. What won’t be disclosed, but I’m hearing from insiders, is that around 20,000 new users are joining daily.

The company, along with MOG, will present at the Digital Music Forum East conference in New York tomorrow. Together the two companies are America’s best answer to the Last.fm viral machine, which sees 15 million unique visitors per month and dominates the social music space. Last.fm is headquartered in London.

The backbone of all three companies (iLike, MOG and Last.fm) is the gathering of meta data on users listening habits - all three have software that monitors what users listen to - and then integrating that data into their respective social networks. When I met with the Last.fm executive team last week in London, they told me they’ve collected over 500 million pieces of user data to date, which they call “scrobbels” (they are gathering something like 175 new scrobbels per second). Last.fm is the MySpace of the music based social networks.

ROI Is Social Media's New ROI

By Joe Marchese
Looking for ROI on your online marketing campaign? There is a 50% chance you are looking for the wrong thing. That's because ROI is out -- the new thing for increasing sales and building brands in social media is ROI. What I am saying is that before you can really discern return on investment, you need to understand how you are going to achieve influence for investment and return on influence.
Social media is all about influence and, like it or not, everyone who participates is an influencer. Social media decides what's in and what's out. Social media allows brands to be amplified or destroyed in the blink of an eye. And social media is as fickle as a high school lunchroom. I am not just talking about MySpace and Facebook here -- although they do represent a sizable chunk of social media. Social media is all media developed by, incorporating or facilitating the formation of community for the purpose of self-actualization. This definition includes everything from major media's online video components to upstart video-sharing sites, from the MySpaces of the world to the fledging baby boomer social networks -- and everything in between. And what social media delivers for investment can't always be captured in clicks and actions. What social media delivers in return for investment is cultural and generational influence.

Positive return on investment is a great thing; however, just looking at traditional return on investment skips an important step. Advertisers and agencies need to be looking to maximize influence obtained through their investments, and return on that influence should be the end goal of the total investment. Important to remember is that investment to obtain influence can take a number of forms. The easiest way, obviously, is to look at dollars spent, but influence isn't always for sale (at least not in an efficient manner). The pivotal balance for maximizing influence obtained through investment is to balance investment in creative, which enhances the content in which it resides, with investment in purchasing distribution for said creative. There is any number of ways to optimize a particular combination of creative and distribution, once you find the right platforms. It's true that social media means more expense on the creative side, since it demands greater content pull, and explicit acceptance of messaging, than traditional media does. But social media does not eliminate the ability to purchase distribution, as there can be a number of advertisers able to produce creative relevant to a particular piece of social content.

The battle isn't over once social media decides to lend an advertiser its influence, since advertisers then need to capitalize on that influence. This means controlling the message, not to garner a single transaction, but rather to leverage the influence lent to the advertiser for its investment to build premium brands that command premium margins. I am still not sure why I buy Coke or Pepsi instead of the cheaper store brand, but I am pretty sure it has something to do with this factor. Maximizing return on influence is again a balance, a balance between investment in creative messaging (back to relevancy) and ensuring that online brand experience/messaging resolve in the real world. Making sure the experience resolves in the real world is 50% product quality and 50% product availability. Insuring premium product quality may be outside of marketing and advertising's control, but ensuring that the premium product is available (for its premium price) to social media influencers and those influenced (commonly one and the same in social media) is promotional marketing at its finest.

Return on influence takes into account the lifetime brand creation and/or lift delivered by brand advertising within social media. Now their devil is in the details; how do you calculate influence? How do you create an efficient market accessing influence? How do you measure the effectiveness of your social media campaign when the campaigns goals aren't to drive immediate actions (or if immediate actions only represent a portion of the total value)?

The takeaway is this: if all advertisers are looking at is immediate return on investment, there is a good chance they are missing the real potential for maximizing their investment in social media -- and probably spending way too much in the process. But it's not the advertiser's fault entirely; the platform hasn't been built that efficiently facilitates accessing the type of brand-building influence offered by social media ... yet.

Google to change AdWords formulas - Search Marketing - BizReport

Google to change AdWords formulas - Search Marketing - BizReport: "Google to change AdWords formulas
Online marketers will need to brace for a change next week, when Google changes their quality score algorithm. The search giant will also add a column for AdWords advertisers to see their own quality score for keywords.

by Kristina Knight

According to Marketing Pilgrim, Google is making the changes to improve transparency and also to make the quality score easier to understand, thereby making it easier to optimize online campaigns.

The quality score has always been a part of how Google ranks keywords, but in the past the quality score wasn't available to individual advertisers. Now the quality score will be listed in a special column on the AdWords advertiser page. The company is expecting some adverse effects from the algorithm change because the score for some keywords will drop. The majority of the keywords that drop will be because of poor past performance, but since advertisers haven't been privy to that information in the past it could come as a shock.

Because of the algorithm change, some advertisers will actually see their minimum bids drop. Some of the new quality score information will go live Friday, which should help advertisers get a grasp on how quality score works before the changes go live next week."

Customizing Cellphone Ads

Wall Street Journal Video - WSJ.com

Enterprise - WSJ.com

Enterprise - WSJ.com

Turning an Online Community Into a Business

Social Sites Started as Hobbies
Offer Alternative to Big Players
By Catering to Specific Interests

Semantic Networks and Social Networks ~ Stephen's Web ~ by Stephen Downes

Semantic Networks and Social NetworksBy Stephen Downes

October 10, 2005

This article surveys properties of social networks and the semantic web, suggests that social network analysis applies to semantic content, argues that semantic content is more searchable if social network metadata is merged with semantic web metadata.

The Learning Organization Journal, 12(5).

Abstract

Purpose: To illustrate the need for social network metadata within semantic metadata.

Design/methodology/approach: Surveys properties of social networks and the semantic web, suggests that social network analysis applies to semantic content, argues that semantic content is more searchable if social network metadata is merged with semantic web metadata.

Findings: The use of social network metadata will alter semantical searches from being random with respect to source to direct with respect to source, which will increase the accuracy of search results.

Research limitations/implications: Suggests that existing XML schemas for semantic web content be modified.

Practical implications: Introduction and overview of a new issue.

Originality/value: Foundational to the concept of the semantic social network; will be useful as an introduction to future work.

Keywords: Information networks, Internet, Social networks

Paper type: Conceptual paper

LINK: http://www.downes.ca/cgi-bin/page.cgi?post=31624

5 Things I Need as an Affiliate

from Affiliate Programs by Warren

Warren here, one of the guys behind AffiliatePrograms.com.

I've been an affiliate myself for about 6 years now and have been amazed at how things have changed over the years. Nothing can compare with the days of optimizing sites/pages and submitting them by the droves (and don't pretend you didn't) to engines like AltaVista through a rudimentary script...and then watch the top rankings roll in. I surely miss those days, but hey, the competition and growth in the industry has brought a ton of innovation and new ways to make money online (and beyond).

So, I wanted to start off my welcome to you all with something pretty basic, the top 5 things I personally need as an affiliate. Here goes:

1. An affiliate manager who knows what he/she is talking about.
   
   Listen up you online behemoths, don't expect me to send you traffic when you hire dimwits for me to interface with. I'm taking the risk and hoping you cut me a check at the end of the month, and your affiliate manager clearly reflects how well that will pan out.
   
   
2. Prompt payments
   
   One day an affiliate manager asked me what difference it makes whether they pay me on the 5th of the month or the 15th. Guess what? It's called reinvesting in domain names, PPC costs, new site designs, and back-end programming. How am I supposed to build my online real estate if my tenants don't pay me my rent?
   
   
3. Outside-the-box creatives
   
   I don't have a single 468x60 on any of my sites, so why the hell does every program offer a plethora of these creative types? Get creative and start offering your affiliates unique ways to market both online AND offline. Help us market to mobile consumers by investing in your own mobile short code, for example. Utilize AJAX to allow creatives to change on your affiliate's sites on the fly based on user activity. Come on, get with the times.
   
   
4. Geo-targeting & International help
   
   On some of my sites, the international traffic is upwards of 15%. How can I market to this audience effectively without the right marketing tools for these languages and countries? Merchants need to be much more prudent with the tools, creatives, landing pages, and payment options (both consumer and affiliate) offered to their international audience.
   
   
5. Better personal interaction with my peers
   
   Some of the best ideas I've ever implemented within my sites has been through the advice of other affiliates. I don't think the conferences out there do a good enough job of supporting such activity, nor do the affiliate directories and forums. I'm hoping to fix this problem via some new things we're incorporating here and I would LOVE any feedback on where you guys (meaning affiliates, not managers) think the mark can be raised. I really do want this site to be an extension of myself as an affiliate, so comments are welcome. Or, I can just do what I think is right and hope that everyone is pleased with the outcome.

AOL Extends $900 Million DoubleTrader Bid

AOL has extended its $900 million takeover bid for Swedish marketing firm DoubleTrader until March 14th.

AOL is offering 215 Swedish crowns per share. Shares have been trading for more than that on the open market, says the Associated Press, because investors expect AOL to increase its offer. AOL says it does not intend to do so.

AOL first announced the buyout decision in January. DoubleTrader’s largest investor, Arctic Ventures and about 20% of the shareholders said they would be approving the deal.

AOL wants to integrate DoubleTrader into its Advertising.com business to enhance its online advertising services in the U.S. and Europe. AOL’s Swedish holding company, AOLS Holdings, has received government approval for the buyout.

Under the agreement between DoubleTrader and Time Warner-owned AOL, 90% of the shareholders must approve the deal. The DoubleTrader board has unanimously recommended that shareholders accept the offer, but many shareholders are still blocking, in the hopes that AOL will increase its offer.

“After carefully evaluating the Offer and considering the future prospects of TradeDoubler, it is the Board’s assessment that the transaction is in the shareholders’ best interest,” said DoubleTrader board chairman Kjell Duveblad in a statement in January. “TradeDoubler will get the opportunity to increase its strong growth by leveraging AOL’s popular Web destinations, Advertising.com’s comprehensive knowledge and experience in internet campaign advertisers as well as from the combination of full set of online advertising solutions of the combined businesses.”

AOL extended the current offer deadline to draw in the holdouts, and said that it wants the deal to go through by March 21st.

Vidavee Graffiti

Giving users video customization tools
Plus: Tila Tequila: musician

The ability to customize and personalize one’s blog, IM away message, and even online photo collections has long since been heralded as a web trend, and this power of manipulaton is now commonplace and expected. There are many tools on the Web that give users the power to alter, edit and mash together media to create something entirely new. Similar to how Bubbleshare lets one add music and text bubbles to photos and how Jumpcut provides basic editing tools for uploaded videos, avid YouTube watchers can customize videos much as they would personalize their Myspace profiles.

One such source of YouTube add-ons, Vidavee Graffiti allows users to add effects, animations, graphics, and text onto any video. To use this “legal form of artful vandalism,” the effects are dragged onto the video clip and the start and end time can be selected in a timeline. Once the video is customized, a new embedded tag/code is generated and can be posted and shared elsewhere on the Web. We do not see this demand for artistic freedom waning any time soon, and as more tools will be made available to video sharing sites, we could see a new wave of “Pop-Up Video.”

And by the way:
MySpace celebritiy Tila Tequila’s first single “I Love U” was released on iTunes today. Stay tuned to see how her cyberfame translates to the real world.

Amazon Invests in Shelfari

We’re hearing that Amazon has invested $1 million or so in Seattle based Shelfari, beating out at least one venture firm that competed for the deal.

Shelfari is a website where users input all of the books they own, and have an online visual representation of their library to share with others. Users can share their library through the Shelfari website or via a widget, and make money by linking to the books for sale at Amazon. They launched well after competitor LibraryThing, which was itself partially acquired last year by ABEbooks.

The company won’t comment on the financing, so this isn’t officially confirmed. We expect an announcement shortly, however

MediaPost Publications - Meeting In the Middle - 02/26/2007

MediaPost Publications - Meeting In the Middle - 02/26/2007: "Meeting In the Middle
by Jason Glickman, Monday, Feb 26, 2007 12:00 PM ET
There's an inventory drought! There's no inventory! It's too hard to get enough inventory in the long tail! I don't want that inventory! It's enough to drive any media planner back to running static gifs.
'There's no question there's a lot more inventory out there,' Yahoo's Chief Sales Officer, Wenda Harris Millard, told a UBS global media conference in December. 'And since the explosion of user-generated content, there's a lot of inventory.'
So which is it? Fortunately for media planners, Millard is correct. There is a lot of inventory available. However, we all face the same challenge of finding 'viable' video inventory for our media plans -- not just volume, but the type of video content that we want our brands associated with. Even more fortunate for media planners, this isn't a new problem. "

Blogger Help : What is BlogThis! ?

What is BlogThis! ?

BlogThis! is an easy way to make a blog post without visiting blogger.com. Once you add the BlogThis! link to your browser's toolbar, blogging will be a snap. Or rather, a click. Clicking BlogThis! creates a mini-interface to Blogger prepopulated with a link to the web page you are visiting, as well as any text you have highlighted on that page. Add additional text if you wish and then publish or post from within BlogThis!

There are two ways to use BlogThis!: if you use Windows and Internet Explorer, you can use BlogThis! straight from the Google Toolbar. If you're on another browser, just drag the link below to your browser's Link bar. Then, whenever the mood strikes, click BlogThis! to post to your blog:

BlogThis! <-- drag this link to your browser's Links bar

This is what BlogThis! looks like:

An Ad Upstart Forces Google to Open Up a Little

By LOUISE STORY

Google and Yahoo have been fighting it out over which company will dominate the online advertising business, with Google maintaining the upper hand so far.

But in the competition for contextual text ads — those small sponsored links that run adjacent to related articles online — both companies are facing a challenge from a tiny but growing adversary named Quigo Technologies, a New York-based ad service that bills itself as an alternative to the giants.

In the last year and a half, a trickle of large media sites like ESPN.com, FoxNews.com and Cox Newspapers’ 17 sites have stopped using Google and Yahoo and instead signed up with Quigo.

What Quigo offers is transparency and control in what can often be an opaque business: advertisers pay Yahoo and Google for contextual ad placement on a wide variety of Web pages, but get little say over where those ads run or even a list of sites where they do appear.

Quigo, by contrast, gives advertisers not only the list of specific sites where their ads have appeared but also the opportunity to buy only on specific Web sites or particular pages on those sites. It also allows media company sites like ESPN.com and FoxNews.com a chance to manage their own relationships with advertisers.

Although Quigo remains a small competitor, with less than 10 percent of the contextual ad business, its growing success has apparently persuaded Google, which is accustomed to calling the shots in all aspects of its business, that it has to change the way it sells the sponsored link ads in the future.

At stake is a growing portion of the online ad business, as traditional media companies try to monetize every corner of their Web sites. Contextual ads generated about $2 billion in revenue last year, or 13 percent of online ad spending, according to eMarketer, an Internet advertising research firm. About 60 percent of that money went to Google, David Hallerman, a senior analyst at eMarketer, said.

A central point in Quigo’s pitch to publishers is that it will let them keep control of their relationships with advertisers.

“We are gaining a lot of share,” said Michael Yavonditte, the chief executive of Quigo. “This has become a multibillion-dollar industry with no clear second-place company. There’s a lot of opportunity for other companies to put their own stamp on it.”

Here is how this contextual advertising has traditionally worked: Google and Yahoo post ads on hundreds of thousands of Web sites, but both operate as blind networks — they do not tell advertisers which sites their contextual ads run on. Instead, the advertisers buy keywords for ads across Google and Yahoo’s vast networks of Web sites, including the home pages of big media companies and the smallest of bloggers.

It would be akin to an advertiser buying space on 100 national television programs, but not being told when the ads ran. Google and Yahoo argue that because advertisers only pay when the ads are clicked on, that more specific information is irrelevant.

Nor has Google allowed advertisers to bid for keyword ads on specific Web sites — say, ESPN.com. Quigo says blind network buying lowers the prices that premier Web publishers receive because advertisers bid expecting an average site rather than a well-known, desirable one.

“Google, Yahoo and most other blind networks sit in the middle and own the advertiser relationships,” said Henry Vogel, the chief revenue officer of Quigo, which was founded in Israel in 2001. “By outsourcing their performance marketing programs to them, publishers get a check but little else. They don’t really build any longer-lasting strategic assets.”

Both Yahoo and Google play down Quigo’s inroads into the business. Emily Fox, a spokeswoman for Yahoo, said her company was not aware of losing any contextual text ad clients to Quigo other than ESPN. Kim Malone, director of online sales and operations for Google AdSense, said Google did not worry about Quigo.

“The David-and-Goliath story is always a great account,” Ms. Malone said, “but I think in this case, it’s just not accurate . We have a number of large publishers who have tried out other solutions, and they always come back.”

In response to further questions about Quigo, though, Google said it was prepared to make changes to its AdSense service that mimicked Quigo’s approach, an unusual step for a company accustomed to mapping the terrain in every aspect of its business.

In the next few months, Google’s advertiser reports will begin listing the sites where each ad runs, Ms. Malone said. She added that advertisers on the Google networks would soon be able to bid on contextual ads on particular Web sites rather than simply buying keywords that appeared across Google’s entire network.

Still, Ms. Malone said she did not see much of consequence coming from the changes. “We don’t expect a lot of demand for that placement targeting,” she said. “It’s the brand, the display advertisers who care where they run.”

But ad executives have another view.

Jason Clement, associate director of search engine management at Carat Fusion, an agency in the Aegis Group that buys online ads for large advertisers, says the lack of transparency has kept some large advertisers from spending heavily on contextual ads.

In a contextual advertising test on Yahoo and Google, some clients report bad experiences with their ads’ showing up in odd places. For example, Mr. Clement said a large client of his saw an ad run late last year alongside an article that said soy milk might be linked to homosexuality.

Mr. Clement said he frequently received calls from clients about odd placements, and, he said, they worried about click fraud — a practice in which people click on ads solely to make money for the sites that carry them.

“Last year was really the year of testing these contextual networks,” Mr. Clement said. “We had essentially pulled all of those big advertisers off of the ad networks by the end of the year.”

ESPN switched to Quigo from Yahoo last fall, in part, because of Quigo’s transparency, said Ed Erhardt, the network’s president of customer marketing and sales.

“When it’s blind advertising, you know, it’s just a different kind of buy,” Mr. Erhardt said.

Advertisers will often pay more for ads on sites like ESPN.com than they will for ads on little-known blogs, executives said. Quigo’s transparency about where ads run encourages advertisers to spend more for each click than they would on Google or Yahoo, said Jason Klein, co-chief executive of Special Ops Media, an interactive ad agency.

“Because traditional networks are blind, I’ve always assumed that many of the places where your ads come up are on B- and C-level sites,” Mr. Klein said. “With Quigo, you know it’s on ESPN.com, not Joe Schmo’s sports blog. It’s a premium site, and you’re willing to spend more money.”

For the big media companies, Quigo offers another advantage: it allows them to sell their own contextual ads and run the ads under their own brands rather than Quigo’s. In many cases, ads placed by Google run under a header that says “Ads By Google.” More important than the label, though, is that media companies can sell their advertisers Quigo contextual ads, whereas Google handles all of the sales for its publishers. That lets media companies, where advertiser relationships have long been important, keep control over those ties.

Cox Newspapers used Google AdSense for about two years, but in July, all Cox sites were shifted to Quigo for the text ads.

Cox wanted to sell its own contextual ads and have its brand, rather than Google’s, be the one advertisers see, said Tonya Echols, director of business intelligence at COXnet, the Internet division of Cox Newspapers, a part of Cox Enterprises.

“We’re already talking to advertisers,” Ms. Echols said. “We already have those relationships. We’ve been in our markets for decades.”

While Quigo sells the ads for some media companies, like the Martha Stewart Weddings site, others are selling their own ads. Newsday.com, which began working exclusively with Quigo in 2004, has brought more than 600 advertisers into the Quigo system, Mr. Vogel said.

The contextual ad business is still a small part of large publishers’ revenue from their Web sites. Display and video ads tend to be more lucrative, but this does not mean that media companies ignore the contextual business.

Mr. Vogel said he was not worried about Google’s coming changes to make its system more transparent. He said Quigo would remain distinct because of the priority it placed on giving publishers control and information about advertiser budgets, and its proprietary formulas that select the best ad placement and designs.

Forbes.com, which is Quigo’s most recent convert, was an early participant in Google’s AdSense program, and then switched to another third-party provider called IndustryBrains before coming to Quigo this month. Jim Spanfeller, chief executive of Forbes.com, said switching from Google was “a dollar-and-cent thing.”

“We could make more money with somebody else,” he said.

At the newspaper chain McClatchy, contextual ads are just shy of 2 percent of the company’s online sales, said Christian Hendricks, the vice president for interactive media.

McClatchy is currently testing Quigo’s ads at four of its papers, including The Fresno Bee, to compare it with Yahoo and Google. Mr. Hendricks said McClatchy was attracted to Quigo because it sells ads specifically for the individual newspapers, rather than using a blind network.

“What we’re trying to do is maximize revenues,” Mr. Hendricks said. “At this point, it looks like Quigo is performing better, but it doesn’t mean it will stay that way. All the other networks have to do is start selling our brands.”

MediaTrust Expands Executive Management Team

New York City (PRWeb) February 26, 2007 -- MediaTrust, Inc., an online marketing services company, today announced the addition of two key executives to further build out its management team. Trip Foster has joined as Chief Marketing Officer, responsible for the development and execution of MediaTrust's marketing efforts. Will Chen has joined as Chief Information Officer, responsible for driving the operations, development and internal IT teams for MediaTrust.

"I am thrilled to welcome these two industry veterans to MediaTrust in a very exciting phase of our company's growth," said Peter Bordes, CEO, MediaTrust. "Both Mr. Foster and Mr. Chen will be critical in helping MediaTrust deliver cutting-edge innovative solutions to our fast-growing partner and customer base. Our team is now better prepared to build on our momentum and drive home our reputation as the most trusted, technically innovative and results oriented company in online media."

Mr. Foster, a veteran marketer of software and technology, joins MediaTrust with more than a decade of experience in both media and technology. Most recently, Mr. Foster served as vice president, Marketing and Client Services at Intellibank, an online Customer Relationship Management software provider. Mr. Foster has also served as vice president of Marketing at Net Exchange, a pioneer of marketplace optimization software used by Schneider Logistics, Sears Logistics, State Street Bank, and the Department of Defense. Additionally, Mr. Foster was one of the original entrepreneurs at CheMatch, an online chemicals marketplace. Mr. Foster has also prior worked for agencies such as McCann-Erickson, and The Ad Store, serving clients including: Sony, Visa, Coca-Cola, Salomon North America and Vail Resorts.

"The online media market presents a huge opportunity," said Foster. "MediaTrust's technology and long-term approach to client success really sets them apart. My goal is to extend the company's leadership by ensuring that our technology and solutions continually meet or exceed the market's needs."

With more than 20 years of IT experience, Mr. Chen has worked for many fast growing technology companies including Lynda.com, Openwave and Software.com. He has held various management-level positions where he was responsible for implementing enterprise scale IT systems, managing outsourced resources and services, building and managing global data centers, network and IP infrastructures, managing merger and acquisition integration and developing and optimizing user support programs. At Software.com, Mr. Chen was instrumental in planning, building, and managing the global IT infrastructure and operations that enabled the company's transition from startup to being publicly traded. Prior to Software.com, Mr. Chen founded Global Shopping Network and created a service that attracted more than 500 advertisers for the recreational marine industries.

"MediaTrust's designs technology to make ads non-interruptive and the online experience richer for the end user," said Chen. "It's a great honor to join this team. I am looking forward to helping MediaTrust continue to break new ground in the online media space."

About MediaTrust
MediaTrust (www.mediatrust.com) is an online marketing services company comprised of AdValiant, an affiliate performance network, and AdVario, a proprietary ad-serving technology. MediaTrust offers a 'one-stop-shop' for technology and services across all online marketing channels including: affiliate and search marketing, contextual and display advertising, lead generation, e-mail marketing, proprietary ad-serving technology, mobile marketing, data management, Web publishing, list management, and RSS and podcasting marketing. MediaTrust's experienced marketing services organization ensures that each media campaign is uniquely customized for each advertiser and publisher.

MediaTrust's properties work seamlessly together to deliver real-time, relevant, and intelligent performance-based online marketing campaigns that create awareness, generate leads, drive sales, and retain customers.

Hispanic Ad Growth to Outpace General Market

According to a new study from Kagan Research, Hispanic advertising growth is expected to outpace that of the general market, reaching $5.5 billion in gross advertising revenue by 2010. The study forecasts bigger revenue growth curves for cable nets in the next several years, with projected growth of 32% from 2002 to 2010, versus 12.5% for broadcast networks.

Deana Myers, senior analyst for Kagan Research, says "The rapid rise in population and purchasing power has made the Hispanic TV and radio audience a highly desirable market for networks, content owners and advertisers..."

Some of the key findings of the report include:

Although the Hispanic demo has lower multichannel penetration than the general population, the services are expected to gain ground in the coming decade. Multichannel penetration of Hispanic TVHH is projected to grow to 71.7% in 2010.
TV station players can expect solid revenue growth rates, while radio stations are projected to outpace their English Language peers between 2006 and 2010.
Programming is a potential growth area for all distribution outlets. Cable networks will increase program expenses most quickly, while broadcast networks are likely to have slower growth.

Yahoo Publisher Network’s Trojan Horse

Google has a hefty lead in getting small publishers to put Google-powered ads on their websites. There is no negotiated deal - advertisers agree to take whatever Google decides to give them. Revenue share terms are not disclosed to these small publishers. The publisher simply places a piece of JavaScript code in the code of their website, the ads appear, and a check comes in the mail. For some, this is easy — for most, they don’t know the first thing about getting code into other code; so they likely hire someone to do this for them, then just leave it alone.

So there’s a large base of small (and some not so small) websites out there that now use Google AdSense to make some money. Plus, Google has a stranglehold on the pay-per-click (PPC) text ad market (just look at their earnings), which means increased advertiser competition, which drives cost-per-click (CPC) up on ads, which provides publishers with maximum revenue potential — well, assuming the rev-share % Google provides is the same as Yahoo!, Microsoft, or AdBrite. But no one really knows how much Google provides (99% of) the publishers using Google AdSense, which is really kind of a shocker — we’re all just trusting that Google is compensating us well, when really they could be taking 70% of the ad revenue and only giving publishers 30%. Google doesn’t disclose the rev-share to publishers.

Yahoo! was slow to the contextual ad game, but they are here now. They finally rolled out Yahoo Publisher Network (YPN), but it’s still in beta — you can’t actually get an account immediately, but rather only be considered for the program. Publishers have been using Google AdSense — why would they switch? Plus, publishers don’t want to mess with their code — removing Google and replacing with Yahoo code.

One way Yahoo can compete is on price and transparency. Simply giving publishers a higher percentage of the total pie, and actually disclosing what that percentage is, would convince many publishers to switch. But not all - the fact is that Google’s AdSense code is embedded on many websites and the switching costs are enough that they just won’t change to Yahoo.

Enter MyBlogLog

However, many publishers are finding the value in MyBlogLog — a distributed social networking platform that allows readers of blogs to learn more about each other and communicate with each other. Publishers — mostly bloggers — have been adding this code to their websites. Once you can get a publisher to add code to their website for your widget, they typically aren’t going to take it down.

I’m sure Yahoo! has plans for taking advantage of having this MyBlogLog widget code on many websites, to somehow edge their YPN code on to these websites — or simply integrate YPN into the MyBlogLog widget that already exists, so that publishers wouldn’t have to touch a thing. Coincidentally, MyBlogLog (Yahoo) is also tracking information on Google AdSense — how many clicks Google AdSense ads are receiving (on webpages that have both MyBlogLog and AdSense installed), the ad unit size, and what webpage those clicks occurred. Yahoo doesn’t know the CPC for each of Google’s ads, but they do know the click-through rate (CTR) — and can specifically target high CTR publishers first, with their YPN offering.

But even with the MyBlogLog widget access, publishers are looking for more money at the end of the day — the YPN offering would have to practically guarantee much more money to the publisher, in order to spur adoption and convert AdSense customers. Considering Yahoo doesn’t have as many advertisers as Google does, I imagine that 9 times out of 10, Google is able to compensate publishers more per click (once again, depending on the rev-share percentage back to the publisher).

In-text advertiser Kontera has introduced a new advertising platform

In-text advertiser Kontera has introduced a new advertising platform that aims to make text advertising dance, if you will.
The new ContentLink Rich Media system lets publishers embed video and animation-based ads into the text of a web page. Kontera’s system scans a participating web page, revealing keywords which can then be replaced with relevant advertising that appears when a user hovers their mouse cursor over them.

With the new system, Kontera is adding several new ad formats including the 300 x 250 ContentLing Flex size that includes video and Flash interactivity that can be used to get input from customers. The added interactivity was designed for use in lead generation campaigns.

“We are launching ContentLink Rich Media in response to the increasing demand we have received from our customers who want to combine brand-building creative with the contextual relevancy,” said Bryan Everett, Kontera’s SVP of sales, in a statement. “ContentLink Rich Media creates an online advertising vehicle that is the best of both worlds.”

The new platform is available immediately for Kontera in-text advertisers.

World's Biggest Media Buyer Gets Even Bigger, WPP's Billings Grow 13% To $56 Billion

by Joe Mandese, Friday, Feb 23, 2007 8:33 AM ET
WPP, THE WORLD'S LARGEST BUYER of media, is getting even bigger. The parent of MindShare, Mediaedge:cia, MediaCom and Maxus this morning reported that its media billings grew 13% during 2006 to $55.6 billion. Based on estimates from WPP's own GroupM unit, that would give the U.K.-based agency holding company a 14.1% share of the $395.1 billion global media marketplace during 2006. Media services such as planning and buying, in fact, continued to show the greatest growth of all of WPP's service sectors during 2006, and digital and interactive media are playing an increasingly larger role within that. Direct and digital-related services now account for more than 20% of WPP's total revenues, which are running at the rate of more than $11 billion per year, the company said in a report on its preliminary 2006 results released early this morning.
"Media investment management and information, insight & consultancy combined, grew by 10% in the year on a like-for-like basis, well ahead of independent competitors," the company said.

GroupM's units were especially strong contributors, generating an estimated $4.361 billion in net new billings during 2006.

Podvertising

FEBRUARY 23, 2007

'Meet you on the download, dude.'

As a rule, most widely consumed podcasts still have less than 50,000 downloaders, and most have far fewer, but podcast distribution and viewing mechanisms are proliferating and podcast advertising has marketers buzzing.

No wonder.

Even though podcast advertising spending was a mere $3.1 million in 2005, it rose to $80 million in 2006, and eMarketer forecasts that it will grow fivefold in the next five years.

"Despite an incessant buzz about the medium, regular podcast users are still rare. As such, podcasting is a niche marketing channel; it may be the right niche for some marketers, but it's still a niche," says James Belcher, eMarketer senior analyst and the author of the new Podcast Advertising report. "The fact that podcasts are supplemental ad channels for most marketers is not for lack of choice, however. Downloadable serialized short content format is increasingly available, and iPod sales are seemingly unstoppable."

In fact, it is the sheer number of podcasts — nearly 90,000, according to podcast search engine PodNova — that makes it difficult even for interested marketers to choose the right programs to showcase their brands.

"Podcast sponsorship uses the medium's strengths: self-selected subscribers, host endorsements and low-waste ad impressions," says Mr. Belcher. "Yet the time and effort required to develop an effective sponsorship will keep podcasting from cannibalizing ad dollars in other channels anytime soon."

As of now, only a minority of US Internet users listen to podcasts, but according to the "Podcast Downloading" report from the Pew Internet & American Life Project, roughly 12% of Internet users say they have downloaded a podcast to listen to or view at a later time.

The audience of people who have been exposed to podcasts is growing. That number compares to 7% of Internet users who reported downloading a podcast in Pew's February-April 2006 survey.

Mary Madden of Pew, the author of the report, estimated in a podcast interview that 17 million people had downloaded podcasts for use on their computers or iPods.

"The bad news is that in surveys only 1% of respondents reported downloading a podcast on a typical day," says Mr. Belcher. "In other words, the frequency level remains very low."

The question for podcasters is: Can they deliver the right, well-targeted niche audiences at comparative — or at least competitive — ad rates?

"In spite of efforts by podcast networks and measurement firms to give it mass marketing appeal," says Mr. Belcher, "podcasting will remain a niche medium for the foreseeable future."

Go beyond the buzz, get a realistic assessment of the opportunities, and pitfalls, awaiting marketers who podvertise — download eMarketer's new Podcast Advertising report today.

Kontera Infuses Rich Media into In-Text Ads

In-text advertiser Kontera has introduced a new advertising platform that aims to make text advertising dance, if you will.

The new ContentLink Rich Media system lets publishers embed video and animation-based ads into the text of a web page. Kontera’s system scans a participating web page, revealing keywords which can then be replaced with relevant advertising that appears when a user hovers their mouse cursor over them.

With the new system, Kontera is adding several new ad formats including the 300 x 250 ContentLing Flex size that includes video and Flash interactivity that can be used to get input from customers. The added interactivity was designed for use in lead generation campaigns.

“We are launching ContentLink Rich Media in response to the increasing demand we have received from our customers who want to combine brand-building creative with the contextual relevancy,” said Bryan Everett, Kontera’s SVP of sales, in a statement. “ContentLink Rich Media creates an online advertising vehicle that is the best of both worlds.”

The new platform is available immediately for Kontera in-text advertisers.

GOOG marketshare

Internet market share – data out from comScore – GOOG gains again in domestic share, but growth decelerates; GOOG posted a solid 20bp gain in market share in Jan ’07 vs. Dec ’06; GOOG grew search queries 44% in Jan, sig. better than industry ღ%, but a sig. deceleration from the ჾ% in Dec ’06. We note this is the first time GOOG’s Y/Y search growth rate dropped <50% since Apr ’06. YHOO posted 40bp shr loss M/M. MSN and AOL posted moderate gains. Overall online search market remains strong.

2007 Ad Network Predictions

This will be one of the most active years for the ad network industry as it goes through a much needed transition thanks to new, exciting ad inventory opportunities. As a matter of fact, ad inventory will dictate new ad network models as each ad network begins to concentrate around its core strength.

As the profit margin for general interest (horizontal) ad networks gets smaller, I predict they will move to an Ad Exchange model that will play to their strength and expertise in remnant inventory. As 2006 proved to the industry, ad exchanges are no longer sketchy business models and can provide a significant value for publishers selling remnant or second or third-tier inventory.

But the ad exchange model presents general interest ad networks with a chicken and egg dilemma: how they can get the most number of publishers and advertisers to use their exchange (which one is more important the publisher or the advertiser) and how to create the best common ground for the two. It would come as no surprise to me if established traditional exchange giants such as eBay join the ad exchange game.

Online video will present contextual ad networks with the opportunity to move beyond textual content and take on the challenging task of understanding and monetizing video content. It will be a rat race with a big prize of becoming the “AdSense for Video.” Though Google is the prime candidate to win the race, it is by no means a trivial task with a set winner.

2006 saw the rise of a new breed of advertising network as vertical ad networks proved they can help brand marketers fill the large void left by general interest horizontal ad networks and present an attractive alternative to the brand-name web properties and large portal ad buys. In 2007 as the branding TV dollars continue the shift to online, vertical ad networks could capture the lion’s share of it by focusing on their core strengths of brand protection, brand engagement, transparency and helping brand marketers connect with their high composition audiences. The key for vertical ad networks in 2007 is to continue demonstrate to marketers that they attract highly targeted, affluent audiences as well if not better than the free standing brand-name sites and portals.

With the enormous pressure behind social networking sites to monetize their reach, behavioral ad networks have a great opportunity to prove their value proposition by segmenting these trendy target audiences into ad packages that both sales reps and media buyers can understand and feel safe with. The key battle will remain the same and that is who can cookie the most sites through strategic partnerships.

With the latest addition of Verizon Wireless to the mobile bandwagon, 2007 is shaping up to be a make or break year for a number of new and existing mobile ad network start ups. With the release of Windows Mobile and the continued adaptation by mainstream users, this will be the year when there will be sufficient mobile ad inventory for the medium to have a chance to prove its value. There will be lots of test mobile ad buys but whether they will translate into value for marketers will depend on how consumer’s react to ads on their mobile devices and if providers can deliver enough reach to become real competition to other proven ad media.

As online ad inventory continues to move from textual and web space to all forms of the digital medium, ad networks will continue to play an ever more significant role in our industry and as each newly established platforms go through their maturing process and new and better ways of monetizing them is discovered, we will continue to see both the evolution of ad networks as well as the birth of new ad networks that present real value for online marketers.

Pheedo Powers New Ad Platform

With the launch of its FeedPowered Ad platform, Pheedo is now allowing its marketing clientele to send text and video content via RSS to customers. Now, Pheedo’s advertisers can engage large amounts of customers with content, and levels of engagement can also be tracked with the new platform.

FeedPowered Ads will provide updated information in the form of a text, audio, or video format from any RSS feed within an on-site advertisement. Consumers can then subscribe to the RSS feed or choose options like Digg, Del.icio.us, Reddit and others to provide feedback.

With FeedPowered Ads, publishers are no longer waiting for subscribers, as the latter group can be targeted through other outlets, and even spread the RSS information themselves. Through FeedPowered Ads, program ads are automatically updated as RSS feeds change.

In a press statement, Bill Flitter, founder and VP of marketing of Pheedo, says, “Marketers are always asking us how they can do more with RSS once they have created feeds, and FeedPowered Ads are the answer. FeedPowered Ads change the way marketers communicate with potential customers by putting consumers in control of how they want to interact with content.” Flitter continues, “We are in a world of fragmented media where customers demand control, and marketing products and strategies, such as FeedPowered Ads, that embrace this concept will prove to be the most successful. FeedPowered Ads give marketers and publishers a way to extend the reach of their content and leverage the power of RSS to move content easily around the web to engage new audiences and customers.”

Yahoo Organization Email

From: Sue Decker
Sent: Wednesday, February 14, 2007 9:01 AM
Subject: Update on APG Organization

Yahoos,

In December, Yahoo! announced the formation of the Advertiser & Publisher Group (APG), and today I am excited to provide more details with you about how we will be structured and the talented team that will lead APG.

The mission of the Advertiser & Publisher Group is to lead the transformation of how advertisers connect with their target consumers and businesses across the Internet, thereby driving more value for more advertisers and more publishers than any other company. We believe we have the right combination of assets to capitalize on the market opportunity and drive long-term strategic growth for Yahoo!. Our primary objectives in designing this organization are driving customer-centricity, maximizing accountability and facilitating fast, smart decision-making. To that end, we have organized APG around three key critical functions:


* Demand Channels: focused on providing marketing solutions to our advertising customers
* Supply Channels: focused on strategically selecting and serving our publishing customers
* Marketing Products: focused on matching every advertising offer from our demand channels to the best piece of advertising inventory from our supply channels, whether that is on Yahoo! or on one of our publishing partners' sites.

Marketing Solutions (Demand Channels). Consistent with Yahoo!'s organizational focus on being customer-centric, we have chosen to organize our demand channels around two primary sets of advertisers: those who interact with us through a direct sales relationship (Direct Sales Channel) and those that interact with us primarily through a self-service online model (Online Channel).

The Direct Sales Channel will be led by Greg Coleman, EVP Global Sales, who will continue to manage our industry-leading direct Internet sales organization focused on delivering the most effective marketing solutions to our larger customers. Wenda Harris Millard and David Karnstedt will continue to report to Greg and lead Yahoo!'s direct sales organizations. Greg and his team will also continue to drive our international sales growth, working in tandem with the sales leadership in local markets. The sales operations team will largely remain in Greg's organization as well, while we will be moving yield management and inventory optimization to a new group on which I'll elaborate below.

The Online Channel will be led by Rich Riley, who has been promoted to SVP Online Channel & Small Business Services. Rich will lead this team in enhancing and delivering value to those businesses that interact with Yahoo! primarily through a self-service online model, whether they are looking for marketing solutions, publisher products or merchant solutions.

Yahoo! Publisher Network (Supply Channels). Our publishing customers are a critical component of the ad network ecosystem, and we are committed to driving and expanding monetization opportunities for this important customer segment. I have asked Hilary Schneider to lead the Yahoo! Publisher Network (YPN) organization. I also want to thank David Karnstedt, who stepped in to lead this group while also leading direct search sales, and enhancing the overall connection and strategy of this group to be more aligned with advertising customer objectives. This team will be instrumental in developing and executing our global strategy of becoming the leading search, display and listings-based ad network by securing ad inventory on off-Yahoo! publisher sites. This off-Yahoo! inventory will complement the Yahoo! network inventory and enable our demand channels to offer our advertising customers not only the broadest array of marketing products but also the most robust and high quality audiences as well. As part of his responsibilities for the online channel, Rich Riley will drive the strategy around customer acquisition and retention of small publishers, supporting Hilary in this capacity.

Marketing Products Division (MPD). The Marketing Products Division is the "magic in the middle" that connects the two customer-centric functions described above. This division is responsible for developing the marketing products and ad marketplaces that will drive the greatest effectiveness for our advertising customers and the highest monetization for our publishing customers. MPD will achieve this by optimally connecting the marketing offers generated by the demand channels with the ad inventory generated by the Yahoo! network and YPN with speed and scale. We are currently searching for the head of this division. MPD is comprised of the following:

Search and Listings Marketplaces: Tim Cadogan has been promoted to SVP, Search and Listings Marketplaces and will be responsible for business and product strategy, marketplace design and matching, business operations and policy for several marketing products, including sponsored search, domain match and the submit family of listings products.

Display Marketplaces: Todd Teresi has been promoted to SVP, Display Marketplaces and will be responsible for business and product strategy, marketplace design and matching, business operations and policy for several marketing products, including display and content match. As the mission of MPD is to optimally connect offers to inventory, yield management and inventory optimization will move from Sales Ops into this team.

As we move toward a more centralized model for product management in order to drive our key objectives, two key organizations will support these two ad marketplaces teams:

Product Management: Mark Morrissey has been promoted to SVP of APG Product Management and will have global responsibility for the product requirements and prioritization of all advertiser and publisher marketing products, including sponsored search, domain match, content match, display advertising, advertiser applications, publisher applications, and mobile monetization. In the past, our products have been largely managed separately – search vs. display vs. listings, advertiser apps vs. publisher apps, small biz vs. YPNO. To align around super-serving our customers by creating more seamless experiences with our products and leveraging the breadth of our ad products, we are moving toward a much more centralized product management structure by adding display advertising, content match, and publisher applications to Mark's current responsibilities.

Engineering: Qi Lu, EVP, Engineering will lead all engineering efforts for APG and will partner with Mark Morrissey in Product Management to ensure development and delivery of leading edge products. Qi continues to report to Zod with a dotted line into APG. In his new role leading the SDS-APG solutions team, Dev Patel heads the group that will continue its key role as the data solutions provider to APG, working with both engineering and product management.

Steve Mitgang and Lisa Morita have decided to leave the company to pursue new challenges. Steve's existing product management and marketing teams and Lisa's existing Customer and Content Solutions team have become part of key groups in the new APG organization. With Steve's departure, all of product management (formerly under Steve) will now report to Mark Morrissey . Product marketing in Steve's org will be organized with product strategy reporting to Tim and Todd in their respective product areas and channel marketing reporting to the demand/supply channels. With Lisa's departure, Customer Solutions will report to Rich Riley and Tim Cadogan will lead Content and Product Policy, Product Quality and Analysis, Content Solutions and International CCS, on an interim basis. Steve and Lisa have been tremendous assets to the company, and I sincerely wish them both well in future endeavors.

In addition to the Demand and Supply channels and the Marketing Products division, APG includes the Local Markets & Commerce Division and Strategic Marketing and Major Initiatives.

Local Markets & Commerce Division (LMC, formerly Marketplaces). Hilary Schneider has been promoted to EVP of LMC and the publisher network. She will continue to run the Marketplaces businesses (Shopping, Travel, Autos, Real Estate, Local, Hot Jobs, Personals), which are being re-branded Local Markets & Commerce and, as discussed above, she will also oversee our publisher strategy. Hilary has extensive experience managing the operations of large publishing companies in both digital and print media, including Knight Ridder and Red Herring, and I am confident in her ability to lead and grow both the YPN and LMC organizations.

Second, I will look to hire a leader for Strategic Marketing & Major Initiatives. This person will work closely with various groups to pull together APG's customer and market segmentation understanding, competitive benchmarks, and marketing and communications strategies. He or she will manage a small APG incubation team to generate ideas and implement plans for new segment-specific offerings.

Primary Support Functions

There are several key roles and teams that will serve in support functions to extend my capacity to manage this new and dynamic organization. I am happy to announce Jeff McCombs has been promoted to chief of staff for APG. Jeff and I have worked closely for almost two years on a variety of projects at Yahoo!, including most recently in his capacity as the finance lead for the eBay deal, Yahoo!'s initial foray into the graphical ad network business and he is already well-versed in the new APG organization and many of its priorities.

I'm also pleased to announce a new addition to Yahoo!, Mark Rubash, who will join Yahoo's finance team as SVP of Operations Finance for APG. Mark will report to me until we identify and hire our new CFO and will partner with Rachel Glaser to cover all of the operating groups in the new structure (see separate email). David Windley is leading the HR function for APG. David joined us recently from Microsoft where he was the HR executive supporting the Chief Operating Officer. Mary Grant will head up the talented legal team supporting APG, and Mary's experience during her tenure at YSM will be invaluable to this group.

As with any changes of this scale, we are evolving the organization over time. For example, we are still evaluating how we will organize for global delivery, including our U.S. based employees that help us deliver our products internationally. Additionally, to strengthen accountability and streamline decision-making, the UED team will transfer its reporting into one of the executives in the Marketing Products Division. Until the leader of this group is named, the team will continue to report through Larry Tesler.

Moving forward we are focused on finding the best ways to achieve our mission with speed and scale to deliver the best experience for all of our customers. Your leadership team will be facilitating the transition of the organizational changes outlined in this email in the coming weeks.

Please plan to join the APG all-hands today at 2 p.m. We invite all Burbank employees to attend in person at the Burbank Marriott. For those in other offices, you can access the live webcast from the front page of Backyard. If you would like to submit a question to be answered at this all-hands, please email question@yahoo-inc.com: .

We have structured APG with the singular focus of driving more value for more advertisers and more publishers than any other company. I am incredibly excited by the opportunity ahead of us, the amazing assets we have to build upon, the ability of the APG leaders and their tremendously talented teams. Now, it's game time! I look forward to all that we will accomplish together in 2007 and beyond.

Sue

More Email Marketing Planned in 2007

A new survey of 1,500 marketing professionals by Datran Media reports that, while sixty percent of consumers who make immediate purchases from email messages did so because messages contained products they were already considering, only one-third of promotional email marketers said relevance was one of their top-three goals.
The study quotes Jupiter Research Vice President and Lead Analyst David Daniels, as saying, in the Jupiter report ROI of Relevance, "Despite additional campaign costs, relevant campaigns increase net profits by an average of 18 times more than do broadcast mailings."
Focusing on marketers' plans to employ email marketing, the survey found that 72 percent of the marketers surveyed indicated that they plan to employ email marketing more in 2007. Specifically indicating email marketing's importance as a CRM and acquisition channel:
70.5 percent reported plans to increase spending on email acquisition
63 percent on retention campaigns
Among the leading brand marketers who participated in the survey, Art.com Director of CRM, Kelsey Lowitz, said "Email marketing is a powerful communication and revenue channel that allows us to engage in real-time, relevant conversations with repeat and new buyers alike. To date, we've seen our email marketing programs result in increasingly satisfied and loyal customers who return and refer us to friends as well as a corresponding increase in new customer registrations."
In addition to boosting email marketing programs, the survey also found that:
More than half of the respondents outsourced email marketing
Email optimization techniques, including landing pages, subject line testing and triggered messaging, were unanimously ranked as "very important."
83 percent of respondents indicated they were confident that email ROI will increase during the new year
You may view the original press release as a PDF document, or see the complete study results here.

Dialing for Small-Biz Dollars

Pay-per-call ads are luring to the Web service-oriented businesses that don't have Web sites and prefer calls over clicks to rack up sales

by Jeffrey Gangemi

Three-year-old Rhode Island-based roofing company AS Enterprises had a big, albeit common, problem: not enough customers. Owner Ann Marie Appleton had tried offering free estimates in local circulars and flyers, but her competitors were doing the same, and the resulting leads were lukewarm at best. She considered an ad in the SuperPages yellow pages, a division of Verizon (VZ) spin-off Idearc Media (IAR), because of its large distribution and solid reputation, but the next edition wouldn't be delivered to homes for eight months.

Eventually, Appleton's sales representative sold her on the idea of a monthly agreement for the company's new Pay For Call service, where businesses pay for each call made to their business via SuperPages' online local search results.

Appleton couldn't be happier with her choice. The service costs around $600 a month, depending on how many times her ad is served and how many calls she gets. AS Enterprises totaled more than $240,000 in sales in 2006, up from just $60,000 the year before, and Appleton says a good 70% of that business came directly from her pay-per-call advertising.

Calls Over Clicks

People used to call just for the free estimate, says Appleton, but those who call from SuperPages are ready to do business. Her closing rate on calls went from 25% to between 60% and 70%, and her call volume has tripled. Since the service requires that she bid against other businesses, each call costs about $25, but Appleton says she'd gladly pay twice that. "It pays for itself with just one job, and I get between four and eight good jobs a month," she says.

Princeton (N.J.)-based research firm The Kelsey Group estimates that the pay-per-call market will more than double each year for the next five years, with revenues reaching $3.7 billion by 2010. "Call tracking will live side-by-side with pay-per-click, e-mail tracking, coupon prints, and other measurable consumer actions. For off-line businesses in the service sector (painters, roofers, etc.), calls will have a higher importance than clicks," says Matthew Booth, senior vice-president and program director for interactive local media at Kelsey.

Small-business customers like Appleton say it offers a better return on investment than pay-per-click advertising and suits the needs of businesses that often can't close a sale via the Web only (see BusinessWeek.com, 1/29/07, "Small-Biz Ads: The Year of the Web").

Dropping the Dime

Still, the acceptance of pay-per-call by no means signals the end of pay-per-click; in fact, that market continues to grow. But some small-business advertisers are getting outpriced by their larger counterparts (see BusinessWeek.com, 1/22/07, "The Small Fry Sour on Search Ads"), leading them to look for alternatives.

Most pay-per-call advertising services work like this: First, companies bid for placement on keyword searches. Then their ad is served to the user based on location, and the company is charged each time a user calls; the ad itself is placed for free. When companies register with most providers, their site is assigned a unique phone number that appears in the ad, so that the company can track how many calls actually come through the pay-per-call advertising system. Businesses only pay when someone searching for their product or service picks up the phone and calls them.

Some companies think that the local nature of the product will bring in loads of new advertisers. Ingenio, a San Francisco-based local search advertising company with 110 employees and more than $100 million in annual revenue, is one that's betting that the torrid growth rates of pay-per-click advertising can't continue forever. "Everyone focuses on the 500,000 U.S. businesses targeted by pay-per-click, when there are 13 million businesses not engaged online at all, and 70% of them don't have Web sites," says Ingenio Chief Marketing Officer Marc Barach.

Serious Callers

Therein lies an untapped demand that's making companies like Ingenio salivate. Through their bidding system, Ingenio, like SuperPages.com, has created a virtual market that dictates its own pricing, much like the pay-per-click model. Barach says prices vary across different industries and for different services. Legal-service ads draw higher prices than those from hair salons, for example. And when tax time is peaking, Barach says the price of placing tax-service ads on portals such as AOL (AOL) and MSN (MSFT) goes through the roof.

Barach thinks the advertiser's return on investment more than makes up for the higher initial price of pay-per-call vs. pay-per-click. He says the average conversion rate on a pay-per-call ad is three to five times more successful than a pay-per-click ad in a field like legal services, and that rate grows to eight times for smaller purchases like flower shops. "The reason is that people who are clicking to read Web sites are in the research phase, and people who are calling the merchant aren't doing it for entertainment. Hence, these things convert more."

Get Them Talking

Google (GOOG) is currently at work on its own pay-per-call service, which already works as a part of Google Maps but hasn't yet been offered to U.S. small businesses. In that system, users click on an icon for a restaurant, enter their numbers, and an outside provider connects the user and the establishment. The company has already launched a formal pay-per-call product in India, says Rohit Dahawan, a product manager for Google that oversees the click-to-call and pay-per-call products. And they're working on more such products, to be launched in the next several months in the U.S. They've also started tracking calls as part of their updated small-business AdWords service.

When deciding with whom to advertise, small businesses try to keep in mind the eventual placement of their ads and the amount of traffic that will see it. SuperPages.com had 2.8 billion searches in 2006; Ingenio's network of AOL and MSN reached more than 1.1 billion searches. Says Robyn Rose, vice-president of Internet marketing for Idearc Media, "Having a heritage in the yellow-pages business, we know that about 70% of companies are service-based. Most want to conduct business over the phone."