Monday, March 24, 2008

Looking Glass # 1: ESPN Turns Off Ad Nets to Protect Brand, Content

(Read original article here)

Top Web publishers are planning a revolt. Even as more prominent sites experiment with selling remnant inventory through online ad networks, and in some cases ad exchanges, is saying thanks, but no thanks.

The site recently cut ties with Specific Media and several other unnamed ad networks, and is taking the bold stand that ad selling that relies heavily on arbitrage and algorithms is not for them.

“We’re heading down a path where it no longer suits our business needs to work with ad networks,” said Eric Johnson executive vp, multimedia sales, ESPN Customer Marketing and Sales. Sources say that ESPN would like to rally support from other publishers behind this move, and ultimately tamp down ad networks’ growth. Turner’s digital ad sales wing is rumored to be considering a similar move, though officials said no decisions are imminent.

ESPN’s decision crystallizes a philosophical debate in the online ad sales industry that has intensified since the Interactive Advertising Bureau’s annual meeting last month, when during a keynote address Martha Stewart Living Omnimedia media president Wenda Harris Millard gave her now famous warning against selling Web inventory like “pork bellies.”

Two sides have formed—those who want to protect traditional, direct selling of premium content brands, and the math-loving crowd which favors automation and data. The math lovers make the traditional sellers nervous.

-----Through my looking glass-----

5 years ago, We (Webshastra - India's first ad-network) created a model where marketers were offered "Audiences" rather than impressions. We never implemented it, but the need for something like this is apparent now.

As long as networks sell impressions and clicks, the above debate will continue. The moment they move to offering audiences to marketers, the differentiator sets in. Networks can leverage their reach across sites to create more accurate demographic profiles. (Cannot be done by individual sites). And create a marketing model where the point of touch (any site in the network) is compensated by the degree of influence it has on its audiences. So, while an ESPN can be very influential in reaching out to a sports lover, a site on literature may be more effective to reach out to a book lover. Compensation to the site can be based on this.

This also helps publishers monetize their content & relationship (with the visitor) in a better way. It moves away from a impression based metric to an audience based metric.

Publishers should focus on providing quality content that engages its visitors. Audience brokers should sell the ads!

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