Tuesday, July 31, 2007
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by Kristina Knight
Personal media network Slide saw traffic triple when widgets were offered. According to the data, daily unique visitors from the US grew from 312,000 to more than 1 million (a 265% increase). Social site HOTorNOT saw traffic double, increasing from 182,000 unique daily visitors to just over 350,000. Finally, widget creation and distribution site RockYou saw site traffic quadruple according to Quantcast. Unique daily visitors grew from 145,000 to more than 520,000, an increase of 228%.
It seems social networks grow more popular every week and with the creation of widgets advertisers actually have a bit more control over their ad dollars. By tracking site statistics through widgets, offering some content via widgets and allowing syndication through widbets advertisers have a clearer picture of how, when and why their content is being used. Widgets also make advertising a simpler thing for marketers.
"Niche social networks offer a tremendous opportunity for advertisers," said Konrad Feldman, CEO and co-founder of Quantcast. "If you have a product that is associated with that focus you have a ready-made audience. The trick is to find a combination of those niche audiences."
by Kristina Knight
More than 8,000 US booksellers sell through the AbeBooks interface.
Hannes Blum, CEO of AbeBooks.com said, “We’re seeing a commitment to put more used books for sale online – sellers already offer over 100 million books through AbeBooks so that could expand to 120 million by the end of 2008, which is great news for people who love buying used, rare and hard-to-find books.”
The study revealed that most of the booksellers working through AbeBooks left a white-collar job - teaching, sales and even some library work - to create their online store. Primarily time is spent actually cataloging inventory. Researchers also found that 21% plan to launch an e-commerce site in the near future, 25% plan to increase their book volume by 10% to 25% this year and about 60% operate only online.
Bravely offering much more than simply the current best-sellers, these used book hubs appeal to those looking for specific older, used and out of print titles. This also means their consumer base is willing to spend a bit more per title than those shopping at brick-and-mortar superstores.
In addition to selling books, the demographic of these booksellers are also voraciously reading books. Despite spending copious amounts of time running their online stores, they are reading between three and five books every week.
The summary notes that Shop.org and MarketingSherpa report usage of ratings and reviews nearly doubling in the US over the last year, while the Bazaarvoice and Vizu survey revealed that 44 percent of US shoppers consider ratings and reviews to be the most useful eCommerce site feature. Product comparison (15 percent), product navigation (12 percent), and privacy information (11 percent) followed in the distance.
by Gavin O'Malley, Tuesday, Jul 31, 2007 6:00 AM ET
MORE THAN DOUBLING IN SIZE overnight, the search-centric iCrossing has acquired Web development agency Proxicom for an undisclosed sum. Growing from 200 to 550 employees, the merger is in line with iCrossing's grand designs to become a top full-service digital agency.
"If you're going to be optimizing pages, you might as well build them," reasoned iCrossing President Don Scales. The two companies had been in talks for about three months prior to Monday's announcement, he said.
Making the deal possible, iCrossing just received $62 million in funding from Goldman, Sachs and existing investors Oak Investment Partners, RRE Ventures and StarVest Partners L.P.
Proxicom gives iCrossing access to an entirely new roster of clients--as there is virtually no overlap between the two companies, according to Scales. Of particular note is Proxicom's automotive vertical, which includes Chevron and Toyota. Dupont is another key Proxicom client.
The acquisition marks one of several recent growth initiatives since the addition of Scales, former CEO of Omnicom's Agency.com.
Monday, July 30, 2007
Home » Archives » 2007 » Jul » 26 » Ad Age Partners with Top 150 Marketing Blogs...
Ad Age Partners with Top 150 Marketing Blogs
Marketing blogs have made it big: Advertising Age is partnering with Todd And's Power 150, a 'Billboard Chart' for marketing bloggers.
According to influx, Todd announced that Ad Age will post the listing and perhaps start using the bloggers as sources for opinions and news."
Perhaps we, like Alice, peek
too readily into tomorrow
With Web 3.0, or the Semantic Web, fast on the heels of its collaboration-crazed older sister, the EU appears determined not to let a major strategic opportunity slip by, according to BusinessWeek.
The so-called 'Semantic Web' promises an internet that, based on behavioral input and advanced analytics, will be able to make more decisions on behalf of users, even arranging in advance what surfers are likely to buy.
Perhaps regretful about opportunities lost in MP3s (whose technology originated in Germany, BusinessWeek divulges) and Web 2.0, EU companies and policy-makers are underwriting hundreds of millions of euros for research into the online experience of tomorrow.
'The US and Europe are competing on funding something that could have an extraordinary strategic impact,' said research VP Whit Andrews of technology consultancy Gartner.
Among other ambitious connotations, the Semantic Web is expected to make the world's knowledge available online. Users will also be able to create new associations in previously unrelated data.
According to BusinessWeek, this could heavily impact fields ranging from the military, to medical research, to"
With summer in full swing, more users are logging to the Internet to research destinations. Research from Compete indicates that search engines are pushing more users toward travel aggregators. Which terms are leading users to these sites?
by Kristina Knight
In many cases it is the brand name. Travelocity, Orbitz and Priceline have become nearly household names and Compete's new search tool indicates that these names are three of the leading search keywords for travel information. Of the top five search terms, all five were actual website names. Travelocity (3% share), Expedia (2.6% share), Orbitz (2.1% share), Cheap Tickets (1.4% share) and Expedia (1.3% share) all ranked at the top of the list for search terms.
Other top search terms include airline tickets (1.1% share), cheap flights (.75% share) and cheap airline tickets (.69% share).
What is more interesting that these terms, however, is that users to input these terms are actually less likely to convert to sales once they are on the website. User who end at a travel aggregator because of a branded term like a brand name are about 40% less likely to buy a ticket or book a hotel stay.
This indicates that travel hubs need to be more careful about which search terms are us"
Sunday, July 29, 2007
Last Fall we entered into the affiliate marketing world and signed on with the big networks: Performics, Commission Junction and Linkshare. Our strategy was broad brush--sign up with as many merchants as we can to determine which ones drive the best search traffic, clicks and of course sales.
Now that we've been at it for a while, we've been able to focus in on what works for our business and how to get the most out of our affiliate partners. Here are a few of the things we've learned:
Learn to edit. There are many many merchants that likely don't apply to your site or customer that will clutter up your content. Focus on the few that you care about and make sure to merchandise their content well.
Make a personal connection. We were resistent to reach out to our affiliate partners because we were new to the space and weren't driving huge sales. We took a risk and attended the linkshare conference and built relationships with all of their top merchants who now have Judy's Book on their radar and are willing to work with us to help jump start sales
Don't be afraid to ask. We figured that exclusive deals and higher commissions were reserved for affiliate sites that were reporting the biggest sales. In just a few conversations at the Linkshare conference it became clear that affiliate partners were very willing to extend special offers or help with custom data feeds and in general enter into a conversation to make the relationship successful
Find a way to stand out. Affiliate partners partners have positively reacted to the Judy's Book value prop, especially the local focus but they also liked our deal editor program which assigns an editor to each of the brands we care about giving the merchant trust that their content will be merchandised and manually reviewed ultimately resulting in what we believe is a higher quality deal site.
We've still got a long way to go but we've made good progress over the past few months and will driving hard to make the affiliate channel work for JB.
July 23, 2007 Permalink
Technorati Tags: affiliate marketing, Affiliate network, Commission Junction, Judy's Book, Linkshare, Performics, Search
Friday, July 27, 2007
|by Eric Obeck, Thursday, Jul 26, 2007 3:30 PM ET|
| IT HAS BEEN A LONG time coming, but 2007 is seeing the explosion (in a bad way) of third-party hosted lead generation. I predict, however, that later this year and in 2008 we will see an explosion (in a good way) of this type of lead generation. Hopefully, marketers won't be so snake-bit by a previous bad experience that they avoid jumping back into the market when the best opportunities in hosted lead generation begin to avail themselves shortly down the road. I define "hosted lead generation" as the practice of marketers positioning lead forms on third party Web sites wherein the consumer completes the form, submits it and his or her data is transferred to the marketer. Leads from co-registrations and lead aggregators would fall into this category. |
Many marketers had bad experiences with these types of leads in the past because some third-party Web sites that host such leads took measures to gather the leads, which ultimately compromised the true intent of the consumer and therefore the quality of the leads generated. For example, offering incentives, prizes, gifts, or "points" to fill in lead forms generally does not improve the quality of the leads you receive. While there are exceptions to this statement, things recently got a bit out-of-hand with this practice. In many cases, because the lead forms were not hosted by the advertiser, the advertiser did not know the context in which someone filled in the form.
As I write this, there are brilliant minds working in far-off corners of the Internet to expose the bad practices and clean things up. These minds work for publishers, advertisers, ad agencies, government agencies, trade groups, etc... The smoke from the bad "explosion" is now clearing and, from what I've seen, best practices are emerging.
Several initiatives are already in place to promote a positive shift in hosted lead generation. OLGA (the Online Lead Generation Association) and I are working together to prepare a series of sessions for the upcoming OMMA East conference dedicated to lead-generation best-practices. Also, I have been pleased to participate in drafting sessions for a Lead Generation Best Practices document that the Interactive Advertising Bureau will likely publish in the next few weeks.
I'm most excited to be a part of two projects involving highly credible Fortune 500 companies that are developing hosted lead generation capabilities on their Web sites. Both receive highly targeted and valuable traffic - in fact, well over 10 million unique visitors a month. Both will absolutely deploy best practices when it comes to hosted lead generation.
I can't help but think that other big initiatives I don't know about are taking place behind the scenes, all of which are going to lead to a significant and positive explosion in online hosted lead generation in the very near future. Get ready!
JULY 27, 2007
David Hallerman, Senior Analyst
Continued from Part One.
How much advertising people are willing to endure to watch video content for free remains unresolved.
While many people seem to appreciate the long-standing concept of free content in exchange for viewing advertising, several factors unique to the Internet turn free content on its head. That includes not only user-generated video content competing with the professionally created kind (at least for the audience's attention, if not always by quality), but also the wealth of the Web choices, video or not, that an individual can click away to in an instant if an ad annoys.
Still, 54% of the US online video viewers surveyed by the Online Publishers Association called advertising a fair way for Web sites to provide free professionally produced videos. However, implied on the flip side of that data is that 46% of respondents do not believe that advertising in exchange for free content is a fair deal. A further flip side implication in the data: 48% of respondents would rather pay to see their favorite online videos than watch an ad.
The length of online video ads has become a key pivot in determining how best to use the format. For example, NBC Universal recently announced that it would not accept online video ads longer than 15 seconds, at least to go along with short-form content (but it would continue to allow 30-second spots during full-length TV shows).
When Piper Jaffray specifically asked US adult Internet users if they are willing to watch advertising before a free online video, the responses split nearly equally into three groups: the 30% who are not willing, the 31% who said it depends on the content and the 39% (combined) who are willing (with 25% only willing depending on the length of the ad).
With near-even splits like that for the fee-free question and for ad-length concerns (see Part One of this article), it's clear that for both online video advertising and content, the debate on how best to use video for Internet advertising remains up in the air.
JULY 26, 2007
David Hallerman, Senior Analyst
Even with US online video advertising spending projected to surpass $1 billion next year, $2 billion in 2009 and $3 billion in 2010, according to eMarketer, several factors hold back growth of TV-like proportions.
One crucial concern comes from uncertainties about the audience's limits, with questions about its willingness even to watch video ads online and how long the ads would play if they run. Audience reactions to online video advertising will ultimately shape how marketers and Web publishers use this medium.
Some research indicates that most people think Internet video advertising is highly irritating. According to the "Online Video Advertising" report from online advertising company Burst Media, 77.5% of those who watch video online find video ads intrusive, while 62.2% say they disrupt their Web surfing experience.
And despite the relative novelty of video on the Web, the problem of too many video ads was the least-liked aspect of online video mentioned by the most Internet users in a Synovate study commissioned by video search company Clipblast!
Yet even for long-form, professionally produced content such as TV shows or movies, 79% of Internet users polled by Piper Jaffray said they are not willing to pay. Is the implication, then, that they would accept video ads in exchange for free content?
Read the conclusion of this extended article tomorrow in Part Two.
By Martin LaMonica
Story last modified Thu Jul 26 12:13:02 PDT 2007
Hefty investments in online services and consumer electronics will let Microsoft maintain its historically rapid growth rate, CEO Steve Ballmer told financial analysts on Thursday.
The largest software company is hosting its Financial Analysts Day at its Redmond, Wash., headquarters, where Ballmer described Microsoft's strategy as making several big bets on emerging businesses while drawing more revenue from its mature desktop and server software franchises.
Microsoft is transforming its product development and business models around "software plus services," or software complemented with online services, he said. The company has been criticized by financial analysts for being slow to capitalize on advertising revenue as search giant Google has done.
"We are hell-bent and determined to allocate the talent, the resources, the money, the innovation to absolutely become a powerhouse in the ad business," Ballmer said.
Company founder Bill Gates, who made a presentation before Ballmer, announced that Microsoft is opening a dedicated center to research online advertising and search called the Internet Services Research Center. Headed by Harry Shum, the center's research will focus on search relevance, spam prevention and searching scanned images, such as book pages.
Ballmer said that the company is tackling disruptive technology changes head-on, namely the shift to advertising-supported Web services. Its commitment to online services and consumer devices are necessary because they provide avenues for the company's software.
He defended continued investments in two unprofitable divisions: Online Services and its Entertainment and Devices division. Microsoft's multiyear commitment in server software for corporate data centers diversified the company and created a multibillion dollar revenue engine.
"We're bringing the same kind of vision and tenacity that is in our DNA that drove us into the enterprise business into consumer devices and online services," Ballmer said. "We are going to be an advertising company, and we are going to be a devices company."
Even coming off a strong fiscal 2007 performance, Ballmer said he has "never been more optimistic" about Microsoft's prospects, outlining areas for more revenue. Those included stepped-up sales of Windows through PC manufacturers, Xbox game consoles, Windows Mobile phone software, increased market share of server software, office worker productivity software for small and medium-size businesses and advertising from online services.
Giving some upbeat reports on its mature business, Microsoft said it has sold 60 million copies of Windows Vista since its launch earlier this year and that its SharePoint Web portal business has grown to $800 million. Ballmer said that by the end of its fiscal year 2008, there will be over 1 billion copies of Windows installed on PCs.
Furthering its strategy to court Web developers and designers, Microsoft said that by the end of the week it will
During Gates' presentation, he described Microsoft's vision for improving users' computing experience with online services; better user interface technology, such as speech and cameras; and a smooth transition among handheld devices, PCs and other devices.
He said that broadband is allowing Microsoft engineers to reconsider the computing paradigm, where resources typically confined to a single machine, like storage, can be done in the Internet "cloud."
Microsoft is building a platform for that new computing paradigm with Chief Software Architect Ray Ozzie "driving the revolutionary new platform that is service centric," Gates said.
By Brian Morrissey ADWEEK
The acquisition brings Microsoft a stock market-like exchange in which ad networks bid for publisher inventory. The real-time auction system is meant to be a more efficient, transparent way to allocate ad space rather than publishers selling their extra ad space directly to networks.
Financial terms of the transaction were not disclosed. AdECN, based in Santa Barbara, Calif., has about 30 employees, the company said.
The move looks to set up ad exchanges at the top three Web ad sellers. Yahoo! earlier this month closed its $650 million acquisition of Right Media, which operates a similar exchange to AdECN. Google's $3.1 billion deal to acquire DoubleClick, which is building an ad exchange, is still pending approval.
AdECN attempts to create a more efficient mechanism for online ad networks to buy and sell ad space. Often, ad networks use redirects and other methods to complete campaigns because they lack the necessary inventory, while other networks have extra impressions, said Bill Urschel, CEO of AdECN.
"The industry has just matured and gotten to the point these independent deals are just too unwieldy and there were too many middlemen," he said.
Microsoft has made several moves to expand its presence in the online ad industry, where it has badly trailed Google in the key search market. In May, it inked a $6 billion deal to acquire aQuantive, which will bring it an ad server, ad network and interactive agency. It has moved to expand the reach of its adCenter platform by adding mobile ad network ScreenTonic. Yesterday, Microsoft also announced it would begin selling ads on Digg, a popular and fast-growing social media site.
"What it does is round out the rest of our platform and provide that central clearinghouse or exchange for our own ad networks to participate and other ad networks to participate," said Joe Doran, general manager of Microsoft's Digital Advertising Solutions unit.
Microsoft said it expects the transaction to close by the end of the year.
Thursday, July 26, 2007
AdECN is the only real-time, auction-based, neutral exchange for online display advertising.
It works much like a stock exchange. A member of the AdECN exchange buys on the exchange for its advertisers and sells on the exchange for its publishers.
The member's advertisers specify in advance how much they are willing to pay based on the visitor's profile, or the visitor's past behavior, or the page content, or other factors. Advertisers can bid on a CPM, CPC, CPA, or CPL basis.
When a visitor lands on a website page, an auction is held among all the advertisers — in less than 12 milliseconds, for every single ad impression. The highest bid wins, and that ad is shown.
- the interface for the member's advertisers and publishers, branded with the member's name and artwork;
- the real-time, per-impression auction;
- the targeting, metering, frequency capping, reporting, ad serving, and all related technology;
- the accounting and money transfer between members;
- all of the servers and bandwidth necessary to run the Exchange.
Members can place all, some, or even none of their traffic on the exchange. They can specify that the auction favor a match between their own publishers and advertisers, unless the profit of using traffic from the Exchange exceeds a certain threshold.
This guarantees members the best possible liquidity — fewer campaigns go unfilled, less inventory goes unsold, and members make the highest profit, always.
July 27, 2007
Microsoft Corp. is acquiring a small broker of ad space on Web sites, part of a broader Internet industry exploration of how electronic exchanges can make the market for online advertising more efficient.
The Redmond, Wash., software maker said it has purchased AdECN Inc. of Santa Barbara, Calif., a 30-person start-up that runs a network linking buyers and sellers of Internet ad space. Terms of the agreement weren't disclosed.
The acquisition follows the purchases by Microsoft's lead online competitors of companies building similar exchanges. Google Inc. this year announced a $3.1 billion deal to buy DoubleClick Inc., which is building an ad exchange. Yahoo Inc. in April paid $680 million for the remaining 80% of Right Media Inc., following a 20% stake it bought in October.
In each case, the Internet companies want to be the first to build a large-scale, dynamic market for the ad industry. Each hopes its exchange can inject efficiencies in trading ad space in much the same way the Nasdaq electronic market did for stocks.
Microsoft executives said they will include their ad inventory from the company's own nascent ad networks and a network it acquired through its $6 billion deal in May to buy online-ad specialist aQuantive Inc.
Microsoft will run AdECN as a stand-alone company in an effort to create a neutral venue for trading.
Write to Robert A. Guth at email@example.com
Wednesday, July 25, 2007
One of the first things that stands out when looking at this overview are the battle lines that are currently being drawn between Google and Microsoft, both of which clearly intend to dominate the advertising market. With the assets they've been stockpiling recently, we can expect even more of a clash between these two giants over the next few years.
It's also interesting to note that the recent run of advertising acquisitions have almost all been for ad servers - DoubleClick, Atlas, RightMedia, Strategic Data Corp., and 24/7 Real Media. This may indicate that companies are looking to lock up as much inventory as possible, given that CPM rates are only expected to increase along with more demand and better optimization/targeting. Ad servers may also be a way to gain direct access to advertisers and their agency representatives.
Given how much startup activity there is in both of these spaces, I was surprised to see how little M&A activity there's been so far in the video and mobile advertising markets. It could be that most companies are choosing to simply build their own solutions, or in the case of mobile advertising perhaps perceive the market as still being too early (although I do feel we are fast approaching a tipping point with mobile advertising).
Looking at the gaps in the market, it's clear we can expect a lot more M&A activity in the online advertising space over the next few years. Who's next? Here's a list of some of the more likely candidates:
Arguably the leading mobile advertising company today, having already served over 3 billion mobile ad impressions since being founded by Omar Hamoui in 2006. Almost every mobile app I talk to is buying inventory from these guys. Check out some of the early entries on Omar's blog to get an idea of how fast this company took off.
Massively profitable online ad network serves over 10 billion ad impressions a month to over 100 million unique users. Able to deliver relevance through effective behavioral targeting and optimization technology. With ValueClick under investigation, BlueLithium has emerged as one of the leading remaining ad networks.
SpotRunner is interesting in that it represents both a new agency model for smaller advertisers, as well as the potential to apply online advertising targeting and optimization techniques to an off-line medium such as cable TV. The company has already raised $50 million from Index Ventures, and corporate investors including Interpubic, WPP and CBS. Will they add to Index's recent successes with TellMe and Last.fm?
The leading behavioral targeting company in the market, reaching over 120 million unique users a month. In addition to the ability to deliver increased relevance, behavioral targeting also allows advertisers to spend much less to reach the same prospective customer, which may help to explain why this segment of online advertising is projected to have double digit growth for the next several years.
With it's broad reach and 15 million + videos served each day, VideoEgg (a First Round company) is already one of the largest video-based ad networks in the market. Although video advertising is still in the very early stages, and online video ad spending remains a small fraction of overall online advertising revenue, the explosion in online video, as well as the opportunity to blend video's high brand engagement with the Internet's interactive, tracking and targeting capabilities is expected to drive 60%+ yearly growth in this segment for the next several years.
Only a handful think of technology as a concept, and just 16 percent use terms like "social networking," said two combined surveys covering 8- to 24-year-olds published on Tuesday by Microsoft and Viacom unit MTV Networks, which includes Nickelodeon.
"Talking to them about the role of technology in their lifestyle would be like talking to kids in the 1980s about the role the park swing or the telephone played in their social lives--it's invisible," Davidson said.
The surveys involved 18,000 young people in 16 countries, including the United Kingdom, the United States, China, Japan, Canada and Mexico.
Terms most frequently used by the young when talking about technology related to accessing content for free, notably "download and "burn."
The surveyors found that the average Chinese computer user has 37 online friends they have never met. Indian youth are most likely to see mobile phones as a status symbol, while a third of U.K. and U.S. teenagers say they cannot live without game consoles.
"The way each technology is adopted and adapted throughout the world depends as much on local cultural and social factors as on the technology itself," Davidson said.
For example, the key digital device for Japan's young is the mobile phone because of the privacy and portability it offers those who live in small homes with limited privacy.
The survey found that Japanese children ages 8 to 14 have only one online friend they have not met, compared to a global average of five. Some 93 percent of Chinese computer users in that age range have more than one friend online they have never met.
Davidson said this was encouraging those ages 8 to 14 in China to select online content over television--a trend not seen in any other market in that age group.
The changes in how the youth market engages with technology is keenly followed by advertisers and content providers. For parents worried about what their children are getting up to amid the wave of gadgets, little has changed in a generation.
The surveyors found that the most popular activities among those in the 8-to-14 bracket are watching TV, listening to music and being with friends. The rankings for those older was similar, though listening to music was top.
Story Copyright © 2007 Reuters Limited
Tuesday, July 24, 2007
The survey, conducted by CSO Insights, questioned marketers about their tactics. More than 70% of B2C marketers said direct mail brought them a high ROI, while more than 45% said e-mail did (respondents were allowed multiple responses).
Do direct mail and e-mail truly bring the best ROI? Was direct mail judged as having a high ROI only because it's relatively easy to track?
Bill Goldberg of Harte-Hanks pointed out, "As companies invest more in multiple channels in a bid to acquire customers, and to retain their loyalty, it appears businesses continue to grapple with data management and data insight — and just what the metrics are saying."
With other methods, such as consumer-generated media, ROI is openly questioned.
eMarketer has also noted that lack of data can make measuring ad ROI tough. But with the Harte-Hanks study, even having the data doesn't mean the case is closed.
A Pitney-Bowes study cited in an April 2007 press release also found mail and e-mail effective for communicating new product information, which could be construed as an indicator of high ROI.
eMarketer Senior Analyst David Hallerman said, "Trackable direct response marketing methods typically have a higher ROI just because of that direct step, when it works, from marketing to conversion."
"On the other hand, newspaper/print ads and TV ads show much lower ROI, not only because they're more difficult to track but also because the primary intent is typically different... the brand's mindshare, not the direct conversion."
eMarketer Senior Analyst Lisa E. Phillips added, "It depends on the product being marketed. Direct mail works very well for financial services, especially credit cards, investments and insurance. CPG companies do well if they send coupons."
Learn how search marketers measure results. Read the eMarketer Search Marketing: Counting Dollars and Clicks report.
Tue Jul 24, 2007 8:55AM EDT
NEW YORK (Reuters) - Time Warner Inc.'s AOL unit said on Tuesday it has agreed to buy Tacoda, an online advertising company that uses behavioral targeting techniques to track Web user habits.
The deal is the latest acquisition by AOL to bolster its online advertising tools following its decision to move away from its Internet access business and instead offer consumers free services supported by ads.
Financial terms of the deal were not disclosed by the companies. A person familiar with the situation said AOL was paying $275 million in cash for Tacoda.
Tacoda's technology allows brand advertisers to target messages to specific audience segments based on the kinds of sites they have visited on the Web.
The capability aims to help Web publishers capture one of the next big waves of growth for Internet advertising, which is drawing marketing dollars from other media outlets.
Industry tracking firm eMarketer has forecast the market for behaviorally targeted advertising will increase to $3.8 billion in 2011 from $350 million last year.
New York-based Tacoda employs about 100 people.
Web media and technology companies have created a lively auction for online ad firms, including Google Inc's proposed purchase of DoubleClick for $3.1 billion and Microsoft Corp's planned acquisition of aQuantive for $6 billion.
AOL has made smaller purchases of ad firms, including mobile ad network Third Screen Media and online video ad company Lightingcast.
Monday, July 23, 2007
Mike Shields JULY 23, 2007 -
Online ad networks, long the domain of direct marketers looking to blast their “act now” offers to large audiences across the Web, are being invaded by brand advertisers. And, some say, those traditional, image-focused marketers are shoving aside their direct-marketing cousins that, as it happens, helped carry the Internet ad business through its darkest days early this decade.
There’s little doubt that the robust market for online advertising—particularly among traditional brands—has benefitted from leading networks like Advertising.com, ValueClick and Blue Lithium. Those players, many of which date back to the mid-1990s, aggregate ad space across numerous sites, ranging from remnant inventory on larger sites to ad space on thousands of smaller sites.
Several of the networks boast reach that rivals that of the portals. For example, AOL-owned Advertising.com, which was built as a network focused purely on direct response, says it reaches a whopping 158 million unique users, or 88 percent of the Internet. “For us, brands are the fastest growing part of our business,” said Advertising.com president Lynda Clarizio.
As major marketers like Ford Motor Co. and Procter & Gamble increase their online budgets, “they’re left with the issue of needing to spend money beyond the portals,” said Brian Fitzgerald, president of Gorilla Nation Media, an online rep firm working with more than 500 publishers. “So they are saying, ‘Let’s start spending it on the mid-tail’”—exactly where the ad networks have strength.
Ad categories that have embraced networks in a big way over the past year include autos, consumer electronics, pharmaceuticals and packaged goods, and big spenders in those categories often look to make a splash, said David Yovanno, general manager of ValueClick Media. “The trend is that we are getting more whales [big brands that take over all inventory] than we used to.”
Some say those “whales” are causing a problem for marketers like LowerMyBills.com and University of Phoenix, the ubiquitous online brands that are the equivalent of late-night infomercials. A few years ago, those players blanketed the Web with their messages by buying bulk inventory at low prices. Now, insiders say, they’re getting squeezed to the fringes.
“I definitely think that is happening on the quality [Web] inventory,” said Will Margiloff, CEO of Innovation Interactive, parent of search agency 360i. “DR advertisers are being pushed aside to less desirable inventory.”
Yovanno said that while ValueClick’s bread and butter is still DR spenders, he’s seen some bargain-basement advertisers get marginalized. “There used to be brands like Casino.net that dropped a million dollars a month,” he said. “They haven’t really evolved since then. They always grinded everybody down on price.” Once bigger brands came along, he added, “It was so easy to squeeze them out.”
Some in the network business say it’s only going to get tougher—even for more established brands like Vonage that rely on tonnage to sign up customers—as online video becomes more prominent, since it doesn’t necessarily lend itself to driving immediate response. If that holds true, it could change Web-marketing for good. After all, could a Netflix or Orbitz build names for themselves the way they did a few years ago?
“Many great brands were built because online media was so inexpensive,” said Michael Cassidy, CEO of Undertone Networks. “They were able to leverage a buyer’s market to brand online while only paying for direct response.”
Adam Kasper, senior vp, director of digital media at Media Contacts, which handles Vonage, believes direct marketers will soon shift away from networks and toward ad exchanges that better suit their needs.
Recently, he’s noticed, networks are catering more to mainstream brands. “Ad networks in general are starting to become less of a clearinghouse for impressions and are starting to become more full service,” he said. That means offering more assistance with creative and ad-serving.
Scott Hagedorn, OMD Digital’s director of innovation, said his agency still spends millions with networks on behalf of DR-oriented clients. And the surge of brand spending, coupled with more savvy clients, has forced networks to be more accountable, he added, offering brands more buying control and transparency while agreeing to more stringent terms and conditions on insertion orders.
Besides cleaning up their operations, both Hagedorn and Kasper said, networks are getting more sophisticated when it comes to behavioral targeting, appealing to both to DR and brand advertisers. Yovanno said 20 percent of RFPs ValueClick receives ask for behavioral targeting, versus just 5 percent a year ago.
That’s essential, as competition grows more fierce, said Jay Sears, senior vp, strategic products and business development at ContextWeb, which recently launched ADSDAQ, an online ad exchange focused on premium inventory. “You are going to see consolidation [in the space]. Unless you have a unique targeting ability, you are not going to be around for a while.”
But some doubt that ad networks will ever be able to service big brands to a large degree, simply because large publishers will never be inclined to let others sell their best inventory.
“That’s always going to be a barrier,” said Ben Crain, vp, media at Rapt, which consults publishers on the pricing of online ad inventory. “I don’t know if there will ever be a critical mass of brand advertisers on networks. I don’t think the University of Phoenix has anything to worry about.”
Internet Brands has kept us busy lately documenting all of its buyout deals. Now it has filed for a $100M Nasdaq IPO. We like Internet Brands but the timing seems bad for an IPO given its current slow down in revenue growth. Orbitz IPO was hurt over the same issue and it would have seemed prudent to wait a quarter or two to come out with some momentum.
Internet Brands was founded in 1998 as CarsDirect.com and added the new parent company name of Internet Brands in May 2005. Internet Brands was funded by Idealab. Idealab held 37.52% of the company's shares before the offering. William Gross also held 37.52%.
Internet Brands is strong in real estate, cars, and travel - all sectors that advertisers prize. It recently bought the top bulletin board platform vBulliten and has started buying sites that are built on vBulletin, so long as they are in the core categories.
Internet Brands had ad revenues of $85M in 2006. Its Q107 revenues declined to $19.1M, compared to $21.9M in Q106. The company blames a slow down in revenue, particularly from its auto category.
Alexa drives me nuts. It uses a broken methodology to measure the internet and is, for reasons unclear to anyone, regarded as somehow definitive simply because it allows you to compare two sites with a single simple number. Its sampling methodology is flawed and the numbers it produces are meaningless. And if you want to help me prove this, please install their toolbar. Of course since most of you are Slashdot readers, most of you won't and that only helps prove my point. Read on for what I mean by all of this, and why it matters.
As the defacto 'Guy in Charge' of a reasonably large web site, I am routinely asked questions by a variety of people that lead inevitably to Alexa. It might be a question from my Boss at SourceForge about traffic. Or it might be a sales guy asked by a possible advertiser why some other random website is bigger or smaller than Slashdot. Most often it's a random reporter doing background for a story that has nothing to do with Slashdot. Why I'm considered an expert is very confusing, but why they always regard Alexa rankings as meaningful is even more so. (READ)
Instead of Talking Around It, Give the Client a Push
By Marc Brownstein
Published: July 18, 2007
After speaking with some of my agency CEO peers, as well as clients, I'm convinced there's confusion regarding roles. Are agencies responsible for meeting goals or actually providing the validation? It used to be that clients had a quarterly ad-tracking study to measure success; now agencies have to provide the vehicles for measurement as well as the metrics. There's also confusion regarding buy-in on metrics.
If the CMO is on board with how you are going to measure success, is that enough? Or does the CEO need to be on board, too? We had an experience recently where we agreed with our client about how success would be measured. What we hadn't counted on is that the chairman of the company had a different idea about how it should be done. We learned about it after the campaign ran.
I am sure some agency-client relationships are doing a nice job of applying ROI. However, most are just talking about it. Tripping over it. Glossing over it. Not being fully committed to it. Hoping the client won't bring it up. Afraid to have the frank discussions about it at the beginning of a relationship, or during it. Or all of the above. As a result, there is too much gray area, and both sides are growing frustrated.
So I think agencies ought to take the lead. Bring up measurement with your clients. Agree on what success is, how it will be tracked, and who will be responsible for reporting it. If you wait for clients to take the initiative, you could get your agency in trouble. Today, it is irresponsible to launch a marketing campaign without defined goals and metrics. Do that, and you'll increase your odds that you'll get fired soon -- because no one will know if your campaign worked, even if you think it did. Just one caution: if sales is the metric, be sure that your client has excellent methods of tracking. And if the product is a complex sale, you had better be 100% confident that your client has a sales team in place that knows how to close. Or else, the blame game will be pointed at you.
Good luck. And may the ROI be with you.
Saturday, July 21, 2007
Known world wide as the ultimate spot for networking, MySpace is increasing it's already dominant power if that's possible, by adding the IPTV market to it's bag of tricks.
Friday, July 20, 2007
|by Per Pettersen, Thursday, Jul 19, 2007 3:30 PM ET|
| THE ONLINE EXCHANGE, A POPULAR concept of late, brings buyers and sellers of any product together in the most efficient way possible -- both get what they're looking for, at a price that's acceptable to each, and the middleman is no longer in the equation. While many have explored the benefits this model brings to advertisers and publishers, a beneficiary not yet discussed is the affiliate marketer. Affiliate marketers have long discussed the possibilities that could be opened up by being able to access offline ad budgets. Using a lead generation exchange, affiliate marketers can use any number of techniques to capture leads from any medium -- print, radio, TV or online -- and sell those leads to the highest bidder. Some exchanges even give the affiliate marketers the tools to make this happen. Marketers can now drive consumers to an optimized online lead capture Web site hosted and optimized by the exchange but owned by the marketer, or drive the consumer to call an 800 number. These are the tools needed to drive profitable arbitrage in any direct response media. |
To give you a example of how this works, let's take a look at a radio ad for debt consolidation (which happens to be one of the most successful categories for direct response radio ads). Let's say a single advertiser spends $5,000 on a radio ad that generates 100 phone calls. That means he's paying $50 per lead, no matter the quality of the lead. The calls will be sent to his sales reps, who will then work to close each lead. It's likely that many of those calls were for information, or from consumers that just don't qualify for his loans. If his success rate were 25 percent, he'd really be paying $200 per good solid lead.
Using the same example, the affiliate marketer could purchase a radio ad using a generic or his own business name and a phone number that connects directly with a customer service rep to get the loan application process started. Now that he's captured the intent of the caller and has a good idea of the level of quality (how big is the loan request, what is the consumer's credit like, etc.), he can sell those leads to the highest bidding lender and make a profit on his initial expenditure. The higher quality leads will sell for the most, while the lower quality leads will generate lower prices. Although he's likely to have generated a mix of leads, his potential customer base spans the entire industry of debt consolidators. Some will pay $300 for a high quality lead, and some will pay $25 for a lower quality lead. Either way, the affiliate has maximized his revenues by opening up the bidding for those leads to the entire marketplace.
Radio is only one avenue. At the same time the affiliate marketer can be capturing online leads through his blog or Web site, through rented billboard space offline, or by running a print ad in a newspaper or magazine. He can manage all of these incoming leads, tracking which generate the most revenue by selling them to the highest bidder through a lead generation exchange. While other companies are buying up ad space in the hopes of generating a lead, the affiliate marketer can serve up just what that advertiser is looking for, often at a better cost for the advertiser but at a price that ensures the marketer earns a profit, too.
Similar to what happened online ten years ago when affiliate marketers jumped into the game, marketers no longer need any call center back-end or direct relationships to participate in the sector. This opens up a whole new world of possibilities for affiliate marketers. The offline direct response opportunity is now open to anybody who wants to try to market in a category, and is poised to create thousands of small businesses that specialize in creating customers out of offline inventory and marketing opportunities.
Says Addition of 1,548 New Staffers, Many in Marketing, Is Reason for Down Quarter
By Abbey Klaassen
Published: July 19, 2007
The stock price took a 7% to 8% tumble shortly after Google announced its second-quarter earnings, which excluding traffic-acquisition costs totaled $2.72 billion, up 62% from $1.675 billion in second quarter 2006. Profit was $925.1 million, or $2.93 per diluted share, in second quarter 2007. That's up from a profit of $721.1 million, or $2.33 per share, for the year-earlier period.
Good news for ad market
The good news for the internet-advertising market is that it didn't appear to be due to a weakness in ad spending but rather an overzealous quarter of hiring.
Google blamed increased operating expenses, including a larger-than-expected headcount increase. Google CEO Eric Schmidt noted on the call that the company exceeded its "expense plan" on headcount as second quarter saw the company add 1,548 employees, the majority in sales, marketing and engineering positions, bringing the total Google workforce to 13,706.
The irony is that Google's intensive hiring has been well documented and the company's executives have lamented about the difficulty of filling their staff during the current hiring spree.
'Happy we did this'
"We overspent against our own plan in the area of headcount," Mr. Schmidt said. "We hired a little faster than we planned. Was this a mistake or not? It was not a mistake, the kind of people we brought in are so good we're happy we did this. ... We'll watch it, adjust, be opportunistic, but we'll be careful about that."
On the revenue side, Google continued to see great growth, especially within its Google-owned sites, which accounted for 64% of revenue and grew at a 74% clip. Its partner sites, meanwhile, accounted for 35% of revenue, growing at a slower 36% clip over the year ago period.
Sergey Brin, president-technology, highlighted the company's introduction of universal search, which means Google now not only presents results from the web but also shows results from video, books, images, news and maps. He also highlighted cross-language information retrieval -- more popular outside the U.S. -- in which queries search the web in multiple languages and iGoogle, the personalized Google home page.
The company didn't give any sense of how its offline sales of ads in print, TV and radio were doing, other than to say that they're a "great success."
"It's too early to see a material impact given the scales of the other side of the business," said Omid Kordestani. "We really need to first prove this model for both advertisers and publishers before we scale it. Hopefully in the next few quarters we can shed more light on this. We are seeing great success and hope to scale this."
He said the company had reorganized its sales force in the U.S. so that they can present all the products. "Every sales group is going through a lot of training," he said.
Viruses via Web Ads
By EMILY STEEL
July 19, 2007; Page B1
Web ads are becoming a delivery system of choice for hackers seeking to distribute viruses over the Internet.
In a development that could threaten the explosive growth of online advertising, hackers have started to exploit security holes in the online-advertising chain to slip viruses into ads. Just going to a site that shows such an ad can infect a user's computer.
In May, a virus in a banner ad on tomshardware.com automatically switched visitors to a Web site that downloaded 'malware' -- malicious software designed to attack a computer -- onto the visitor's computer. ScanSafe Inc., one of the first security firms to discover the virus, estimates the banner ad was on the site for at least 24 hours and infected 50,000 to 100,000 computers before Tom's Hardware removed it." more
Thursday, July 19, 2007
Dynamic Logic's Data Offers Tips For Online Brand Builders
By Abbey Klaassen
Published: July 16, 2007
According to Dynamic Logic, Kraft had four of the most effective brand campaigns, with creative and media for Oreo and Kraft Singles scoring high marks in both awareness and persuasiveness.
Those are some of the common strategies behind eight campaigns Dynamic Logic found to be the most effective online branding efforts out of all the campaigns the company measured in 2006.
Kraft had four of the most effective brand campaigns, with creative and media for Oreo, Honey Bunches of Oats, Kraft Singles and Crystal Light On the Go scoring high marks in both awareness and persuasiveness. Other marketers bestowed with most-effective honors include Unilever, BMW, McDonald's and Luxottica Group for its Ray-Ban brand.
The winners share several traits, said Michelle Eule, VP-research at Dynamic Logic, which is part of WPP's Millward Brown. For starters, they kept the ads simple, with great visual elements and little text.
"These ads are competing with a lot of other elements to grab the user's attention," Ms. Eule said. "If the messaging is too complex or esoteric, people will not pay attention at all or not get the messaging in its entirety."
These eight are not an absolute measure of the best online campaigns of 2006 as the results were culled from only the 600-plus campaigns for more than 400 brands Dynamic Logic was tapped to measure last year. The study didn't include campaigns that have never been measured or were measured by another firm, such as Insight Express. Kraft, for example, is a big Dynamic Logic client and may have had more campaigns among those measured than another advertiser.
While the online space is considered a performance marketer's dream, thanks to the ability to measure effectiveness based on actions such as clicks or conversions, those metrics don't always mesh with brand marketers' goals, which include measures such as awareness, recall and likelihood to purchase, which is what Dynamic Logic aims to capture through controlled exposure studies.
In this particular list, Dynamic Logic first considered awareness, with the top-performing campaigns garnering between 18% to 43% gains, and then looked at persuasiveness, with the eight campaigns listed here all falling into the top quintile in terms of that metric. They also all had positive brand impact, the firm said. Ms. Eule said it's difficult for an online campaign to successfully capture all of those things and credited the prominence of the branding and the products in the ad as being major drivers of awareness.
One key to success in the interactive space is, naturally, interactivity. (While that seems obvious, it's still common to see marketers that fail to take advantage of this attribute.) The McDonald's campaign, from Tribal DDB, Chicago and OMD Chicago, for its Asian salad allowed users to mouse over the ingredients to see exactly what each one was. Kraft's campaign for Crystal Light On the Go, from Modem Media, let users shake a water bottle after the powdery mix had been added -- to virtually mix the drink.
Importance of video
Many of the top campaigns also incorporated video. And it wasn't limited to pre-roll and interstitial ads but also made use of technologies such as running video within banner or display ads. Kraft did a particularly good job of this, Ms. Eule said, with its Oreo ad, from Modem Media, featuring three ballerinas dunking cookies into milk -- a 15-second re-edited version of a TV ad.
And that example pointed to another trait the top campaigns shared: consistency with offline ads.
"Video units consistent with TV likely helped," said Ms. Eule, who suggested Dove's Super Bowl ad about its Self-Esteem Fund, from MindShare, New York and Ogilvy and Ryan Interactive, helped give the online campaign a jumpstart.
The right ingredients for online adsWhat the top campaigns had in common:
- Keep it visually simple. Stick to little text and beautiful product shots. Online ads "are competing with a lot of other elements," said Michelle Eule, VP-research at Dynamic Logic.
- Put the brand front and center.
- Align online and offline campaigns. What's happening in other media can reinforce the online message and vice versa.
- Incorporate video and rich media: McDonald's salad spun. Oreo cookies dunked. And try out various video units—pre-roll, full-page interstitials, in-banner video.
- Add interactivity. Kraft let users virtually mix its Crystal Light On the Go product into a bottle of water.
|by Joe Mandese, Tuesday, Jul 17, 2007 9:01 AM ET|
| MEDIA INDUSTRY M&A DEALS SET a new record during the first half of 2007, fetching $76 billion in transaction value, up 78% from $43 billion during the first half of 2006, according to the latest figures compiled by investment banker Jordan Edmiston Group. The number of media companies that went into play also rose, jumping to 399 during the first half of 2007, up 12% from 355 during the first half of 2006. Online marketing and media services continue to be the major catalyst of M+A market activity, tallying $32 billion in transactions, or 42% of the overall value of media industry mergers during the first half. |
Major online deals announced during the half included Microsoft's acquisition of aQuantive ($5.7 billion), Google's acquisition of DoubleClick ($3.1 billion), and WPP's acquisition of 24/7 Real Media ($649 million).
In all, the top 10 online media and marketing services transactions in the first half of 2007 totaled over $24 billion, accounting for 77% of total deal value for the sector.
The report attributed the surge in online media M+As to the "extraordinary growth" in online advertising, especially the jump in online video advertising sales, which is projected to grow more than 60% through 2010 to nearly $3 billion from less than $1 billion this year, according to figures from eMarketer.
"The story behind the story is the pressing need for greater efficiency of digital advertising delivery," reads the report. "There is a tremendous demand for nuts and bolts companies that improve the deployment, performance, and cost effectiveness of online advertising. This in turn drives M+A, as larger companies assemble end-to-end digital ad management solutions by acquiring smaller outfits, much as DoubleClick and aQuantive had done before being acquired by Google and Microsoft, respectively."
But are some ads sending the wrong message?
Only one-third of US adults find mortgage ads and marketing credible, according to a Harris Interactive online poll conducted in May 2007.
That means that two-thirds of the 2,383 online adults polled thought mortgage ads were incredible — and not in a good way. One in five respondents actually thought that mortgage ads were "not at all credible."
Sanford Brumley of Harris said, "Given the large proportion of consumers who are riding the fence, now more than ever would be a good time for these institutions to examine their mortgage product advertising and marketing messages."
Although most respondents had a low opinion of mortgages in general, 71% were favorably inclined toward fixed-rate mortgages. More than half of respondents also thought highly of home equity loans.
Consumers generally had high levels of awareness and knowledge about mortgage options, but product ownership rates were low. Over half of consumers did not have mortgages at all, while a third had traditional fixed-rate mortgages and 16% had home equity loans. The ownership rate of all other product types was under 10%.
The dearth of mortgage product ownership is not for lack of online ad spending.
The top 25 mortgage companies ranked by advertising spending are throwing money at display ads. Online display advertising grew 66.9% in 2006, to $222 million, compared with $133.1 million in 2005, according to TNS Global data provided to American Banker. At the same time, overall ad spending by this group increased just 7.6%, to $732 million in 2006.
Mortgage applications typically are complex and time-consuming. This explains why online mortgage application growth has largely been stagnant over the past several years, according to eBrain Market Research's "2005/2006 National Technology Readiness Survey."
Even consumers who are willing to go through page after page of questions online still must trust the mortgage provider's security measures.
eMarketer Senior Analyst Lisa E. Phillips said, "Advertising builds awareness, but in this market it doesn't translate into credibility necessarily."
Find out more about marketing online financial services. Read the eMarketer Banking and Bill Paying Online: Chasing Those Digital Dollars report.
by Les Luchter, Thursday, Jul 19, 2007 6:00 AM ET
STEPPING UP ITS EFFORTS IN a delivery platform also being eyed by Google, Microsoft has selected mobile ad network JiWire to deliver ads to municipal WiFi networks in Portland, OR and Oakland County, MI.
For these and other municipal networks, Microsoft will provide local content, including a customized MSN landing page and search capabilities, and also share in the ad revenues.
The Oakland network, run by MichTel Communications, is said to be the nation's largest planned WiFi deployment, covering 910 square miles and 1.2 million people. MetroFi operates the Portland system.
Users will get free service in exchange for viewing full-screen ads from Ultramercial before they hit the MSN landing page. JiWire said it will also provide other ad formats.
JiWire said its hotspot registry allows it to target ads by location.
The company plans to charge CPMs between $35 and $150, according to reports on Computerworld.com and news.com.
Google has teamed up with the WiFi network planned for San Francisco, where JiWire is based. "
Wednesday, July 18, 2007
Microsoft and Ask have joined together in a partnership to offer small business owners using Microsoft Office Live keyword advertising access to not only Microsoft's own MSN and Live Search vehicles, but Ask Sponsored Listings from the Ask.com search engine as well.
The Ask listings will be included as part of an Office Live adManager beta search advertising service, which is a management system to allow small businesses to purchase and manage search engine-based keyword advertising, according to Michael Schultz, U.S. business and marketing lead for Microsoft Office Live.
"This is one of the first times you've had search engines joining together to meet the needs for small businesses," said Schultz. "What's significant about Ask.com getting together with Microsoft Office Live, is we're actually making it simple and easy for small business to understand and take advantage of search marketing. To be able to do things like contextual targeting opens up another avenue to allow small businesses to get their message out."
Office Live users will be able to view and manage their keyword advertising accounts directly from an adManager interface within the product that will give them the option of purchasing ads on MSN, Live Search or Ask Sponsored Listings, he said. The Ask system allows marketers to purchase and manage pay-per-click and contextual advertising campaigns on Ask.com and its publisher network.
Although the deal between Ask and Microsoft comes 15 months after former Ask CEO Steve Berkowitz left the company to head MSN for Microsoft, the partnership was already being set in motion at that time and wasn't affected by his move.
Schultz also played down the importance of two separate search firms joining together to combine their services, saying "it's not a question about bringing in competition, it's about bringing in value. The Live and MSN properties are going to be able to stand on their own. All we're doing is bringing in additional capabilities."
However, some industry experts believe that despite the two well known companies of Microsoft and Ask joining together, their combined resources will still pale in comparison to the market share and reach of Google and Yahoo and the greater amount of advertising inventory they control.
"A partnership with Ask is a small deal. It does nothing to threaten Google or Yahoo," said Andrew Goodman, principal, Page Zero Media, a paid search marketing firm. Goodman said that giving small businesses access to both companies' networks will only "address 15 percent of searches, so you're still going to have to go use Google and Yahoo."
"The spend on ads ultimately derives from the overall search market share," Goodman added. "No distribution strategy for people wanting to spend ad dollars will increase your advertising inventory; you need inventory."