A Man With Two Heads for Two Hats…

16 July, 2008
Two Heads for Two Hats

Two Heads for Two Hats

Ah, yes, well it had to come up again… the whole branding v. direct response debate. At AdViking because we are four we often have different perspectives, but one of us is currently wearing two hats… you see he runs CarQuake which is both a publisher (and therefore earns ad revenue), as well as an advertiser for lead generation (and therefore runs direct response campaigns).

Wearing one hat he bemoans the reasonably inconsequential earnings he gets from advertising sold on the site (currently c. £0.70 CPM)… but wearing the other he demands performance from his advertisers who drive traffic to the site. He wants to see results.

And, there is the rub… because stepping back from the precipice and wearing a third hat he can see two things:

  1. CPM banner advertising is difficult to justify in terms of immediate results. The estimated exposure is good, but how many ‘viewers’ are really viewing? How many are reading his message? How many are being targeted not only as the right audience, but at the right point of the buying cycle?
  2. CPA lead generation is much easier to quantify, but he struggles to get the reward balance right to incentivise affiliates and partners without giving away all the margin.

The advice follows… for CPM, there needs to be more integration of message, greater exposure of offer / communication into the target audience, or it really isn’t worth that much. For CPA, there needs to be a smoother process – a better introduction of the viewer to the proposition and the neatest possible call to action, too many CPA systems are contrived to suit the tracking and not the customer (and, dare I say it, are prone to more ‘fraud’ too)!

Perhaps, later on, over a beer, he might tell you how brands can fully engage their audience without resorting to cheap flash games or clumsy sponsorship deals.

Apple iPhone Apps Launches Ad Networks

11 July, 2008

Apple iPhone Hype Creates New Ad Networks

While reading up on the iPhone 3G and App Store launch, AdViking came across the PR post on RRW about Medialets and then a Silicon Alley piece on Apple iPhone Apps With Ads: A Risky Bet that listed a couple of other networks AppLoop, Pinch Media and PurpleTalk.

AdViking can only see blood on the floor here.

Media buying is in opportunity overload and so with yet more channels being opened to a relatively small audience, AdViking doesn’t really see how any of these companies have a long term future.

The only real chance for success is for one of these companies to get in the commanding position by securing the top app developers and therefore audience quickly, otherwise it will be too late as the established networks come into their turf.

And as AdViking doesn’t believe the browser vs. application differentiator being put forward, as Venture Beat says:  Mobile ad company Admob is about to mint money.

Layoffs at 2nd Tier Networks – Miva, Vibrant Media

7 July, 2008

The AdViking scouts are hearing from unofficial but reliable sources in the field of battle that both Miva and Vibrant Media have made staff layoffs in Europe during Q2 2008. This is regrettable for the employees who are getting their pink slips (or P45s) and we hope that all good people find rewarding and fulfilling employment quickly. Alas, AdViking is not hiring for our latest adventure. At least it is summer and a good time for a bar-b-q and some strong ales.

We do want to note that we believe these layoffs are a sign of the general slow down due to the economy and perhaps the natural advertising cycle. However, we do not believe that the online ad spend is going down overall, only that the spend pattern will migrate to the bigger and better quality sites (like portals) or ad networks and rich media channels (ie, video) – all while we watch online advertising out pace TV advertising in the UK. And is predicted in general to grow around 20% or a bit less depending on what report you read. Those players further down the food chain and/or offering poor products (and traffic) will suffer. We fear that many established players as well as start-ups in the ad space or with ad funded models will be forced to trim back and some will perish. This is a time when it is going to be safer at the head of the long tail of advertising.

On a related note we were reading the UK NMA this week which is touting a story titled “Portals drop ad rates to fill space” (note: paid content, best save your money) and we don’t buy it yet – the idea that spend is shifting away from portals or that their is price pressure. The article goes on to imply that display (banners, brand advertising – which matters!) are being impacted first and that as spend tightens it is shifting to ROI or direct response products. AdViking thinks this is a poor strategy by media buyers as it will only drive up the cost of media or clicks on the likes of AdWords and that then pushes ROI down. Down a rat hole of DR chasing Google’s tail… All media buyers please re-think this strategy, try to get that right mix of spend and help prove the NMA story wrong. Anyway, digital is the king of advertising now. Long live The King!


Miva accounded they are doing a 15% staff cut, including killing it’s Italian Media Operation

Casual Gaming – interview with Mochi Media CEO

30 June, 2008

An interesting interview over on Fastcompany.tv with the CEO of casual gaming ad network company Mochi Media. AdViking is not sure we even know what ‘casual gaming’ is all about, but even though it may sound a bit rude 🙂 — its an interesting emerging area in the digital advertising ecosystem… Hey, we managed to get the words gaming, casual, emerging, ad network and ecosystem all into one short post. We would have included the video but wordpress is stripping out the embed code for some reason – so you can VIEW IT HERE.

Vertical Zoom – Traditional Publishers Announce B2B Ad Network

13 May, 2008

Zoom on Verticals

AdViking is having a month of zooming down on various verticals* and naturally a side effect has been the tracking of relevant items. Which is why AdViking just came across the news that another ad network has been launched.

BBN (Business-to-Business Network) is going to be run by WPP’s 24/7 Real Media on behalf of traditional B2B publishers: Cygnus Business Media, Nielsen Business Media, Reed Business Information and McGraw-Hill. Only numbers being touted is the network will have a reach of 10 million unique visitors a month.

Why it’s interesting:

  • It’s now safe to say that the indy ad network is the new black has jumped the shark but AdViking still believes there is more to come, e.g.: The major US leading verticals (i.e.: autotrader.com, careerbuilder.com and move.com) should band together to create something very powerful.
  • Like, quadrantONE, the ad network created by newspaper co’s: Gannett Co., Hearst Corp., the New York Times Co. and Tribune Co, this is cool because we’re finally seeing traditional publishers start making some serious moves to protect their futures.

What doesn’t seem to be so great:

It appears that the network will only be for display advertising, which doesn’t really lend itself to a typical B2B advertiser. It is stated though that the hope with the network is to grow B2B spend, not just move it around. This might be possible but as the network will really be about bulking out the inventory to provide appealing packages to Agencies, the real opportunity is going for a 3rd party to be to come along and optimise the distressed inventory.

*Vertical Zoom

AdViking gets to have the unique opportunity of being able to focus on different verticals through participation in various events:

  • B2B – Speaking on Vertical Search at Magazine 2008
  • Classifieds – Facilitation of a workshop on Monetising Search at the ICMA General Meeting in Brussels
  • Local – Participation in the Local Search Summit in Oslo

Adify Bought for $300 million

30 April, 2008

AdiFY logo

Cox Enterprises, a family run media company with reported $15 billion of revenue, has announced that they are going to purchase Adify, a niche ad network enabler, for $300 million.

Russ Fradin, Adify CEO, has posted some insights into the deal, the main take-away is that Russ and the rest of the management team are sticking around – very different from what happened with Quigo then!

On rumoured revenues of $7 million in 07 and on track for $35 millon in 08, the ticket price is an extreme multiple and one that a lot of attention will focus on. AdViking things actually the deal is very progressive by Cox (probably the benefits of being family run!).

The main reason that AdViking thinks this is that with the consolidation and domination by GYM, having preferred access to an advertising technology will ensure that as the continued growth of digital advertising occurs, Cox are in a great position to protect and extend their revenues.

AdViking is also very interested in the deal as it is further validation of the need for indy players in the value chain, also see the recent investment in Federated Media.

From looking at the recent comScore data on US ad networks, AdViking would put some money on Burst, ContextWeb and some of the others to go. It also does start to put a very interesting spin on what the opportunity for OpenX could be.

Must Read Posts

20 March, 2008

Two must read posts:

Need to digest these over a long holiday weekend… Lots to think about and I have say this should prove a great spark for a wider discussion on ad networks, branding and the next phase of online advertising and publishing.