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Google To Publishers: Programmatic And Direct Sales Can Cohabitate

Google executives have been banging the drum on “premium programmatic” for months now, calling out the false dichotomy between automated media buys and traditional direct selling.

In a discussion with Steve Sullivan, the Interactive Advertising Bureau’s VP of Ad Technology, Scott Spencer, director of Product Management at Google, offered outlines for the company’s approach, including assurances that publishers didn’t have to worry about cannibalizing their direct sales by turning to programmatic.

“We don’t look at programmatic as isolated from direct sales, we see the obvious need for an holistic approach,” Spencer said. “Programmatic can actually strengthen the direct sales channel. Publishers need the ability to block certain advertisers, certain domains. They need to be able to see how one channel is working against another. Historically, a publisher may have had the management of the SSP independent from the sales team. We’re starting to see blurring, as ad ops bring in more revenue than ever before [and are] being put into collaboration with sales. It’s no longer a case of channel conflict; it’s now merely a question of optimization, with publishers looking to direct and indirect sales tools to make more money.”

Sullivan and Spencer also discussed the meaning of “programmatic” and where the boundaries are in terms of what tools and methods are employed. “We define programmatic buying a little more narrowly than some,” Spencer said. In Google’s lexicon, programmatic begins when you have a situation that allows the media buyer  to define what pieces of inventory they’re going to purchase and use for targeting. Read more…

DataXu Raises $27M

DataXu has raised a $27 million round, a hefty chunk though somewhat less than other recent investments in similarly mature display ad tech companies. (AppNexus secured $75 million last month, Rocket Fuel took $50 million in June).

Thomvest Venture Capital led the round and gains a board seat, while current investors Atlas Venture, Flybridge Capital Partners and Menlo Ventures also participated.

We asked DataXu CEO Mike Baker about the company’s acquisition plans, and he had this to say: “We’ve acquired before (for geographic expansion) and are likely to do so again as we grow.  That said, DataXu has a strong engineering culture so a key element for this kind of expansion is bringing great technologists into the team.”

Acqui-hires aside, DataXu will likely use some of the money to support its growing marketing, sales, and business operations, as well as consulting services.

DataXu now employs 225 in 11 offices in eight countries globally — including the high-growth Brazilian market.. Brands active on the platform number 700 according to the company, and sales revenue from direct-to-enterprise platform sales (as opposed to managed services) is now a majority of revenue.

One of its acquisitions was that of European DSP Mexad a year ago. On the health of that business, Baker says, ”Mexad is doing well despite the uncertain EU economy… Through the Mexad acquisition we have been able to offer the local service and expertise global brands require.”

AOL Ad Network Growth First Revenue Gain in 8 Years

AOL grew revenue for the first time in eight years in the fourth quarter on strong third-party network and search revenue growth. Revenue rose 4% to about $600 million from $577 million in the same period last year, easily beating analysts’ estimates.

Davod Paul Morris/Bloomberg

The company earned 41 cents a share, which analysts were expecting, compared to 23 cents a share last year.

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AOL was up about 7% to $33.50 in pre-market trading.

AOL CEO Tim Armstrong said the company is at an “inflection point” and is now transitioning into an “early-stage growth company.”

AOL saw big gains in its third-party network business, which grew 31%, as well as in search revenue, which rose 17%. The growth in the third-party network business includes $9.2 million of new revenue from Ad.com Japan, whose revenue was not counted in the same period a year ago.

Still, the core revenue driver for AOL if it’s going to continue to call itself a media business first and foremost – display ad revenue — is not yet showing growth. Overall display revenue was flat year-over-year at about $170 million, and domestic display revenue dropped once again – this time, 3%. Subscription revenue dropped 10% year-over-year but grew quarter over quarter.

One area that didn’t live up to expectations in Q4: Patch. Patch did not hit $40 million in revenue in 2012; previously, the company said it was on track to reach between $40 million and $50 million in revenue. Mr. Armstrong blamed Hurricane Sandy’s effect on businesses in Patch towns as well as the company’s focus on bringing the network of local-news sites to profitability, which AOL says it will reach by Q4 of 2013.

Lastly, the board has approved another $100 million for a stock repurchase, AOL said.

 

A Brief History of Online Advertising

From Advertise.com

We’ve come a long way

From the original AT&T and Zima banner ads featured on Hotwired.com in 1998 to the behavior-based targeted advertising slyly blended in with web content people digest daily, the world of Internet advertising has changed the marketing game and way businesses think about connecting with consumers. The Internet itself was established as an information database; a way of efficiently sharing messages and communicating. Advertising inside the messages was an idea that marketers laughed at originally. It is now obvious who got the last laugh. Today, marketers barely remember what it was like to do print ads, traditional press releases, and TV/radio spots. Internet advertising took stale and generic ads and turned them into dynamic, extremely targeted messages.

Before banner ads and AdWords caught on like wildfire, the Internet as an information database transitioned into a full-blown marketplace. The most notable example of an industry leader that caused a paradigm shift for businesses was eBay.com. All of a sudden, brick-and-mortar establishments seemed too involved when consumers could simply do their shopping and selling from home. People could run their businesses from the comforts of a clunky desktop computer with the help of a dial-up modem, free AOL trial, scanner, and half-decent camera (film, probably). Buying and selling merchandise across the web got the world’s attention and people began to realize the potential of the World Wide Web. Then, in walks the behemoth with a mission to catalog every piece of data in the world and make a pretty penny through search advertising: Google.

Once people became comfortable with shopping on the Internet, there was a rush of companies that wanted a piece of the market and they all began building websites and advertising online. The dot com boom got people thinking they struck gold. Marketers scrambled to adapt during the first dot com boom only to quickly be shocked with the proceeding bust. The dust settled, lessons were learned, and Google started taking over the world with their advertising model. Since they were cataloging all of the world’s information, why not charge advertisers to present relevant ads alongside that data they were providing for free?

Internet Advertising Timeline

1994 – Pay per click (PPC) was created to allow advertisers to pay only for the ads that users actually interacted with. This was the beginning of modern marketing techniques: paying only for performance rather than pushing ads out to millions of people without any guarantee.

1994/1996 – CDNow.com launched the first affiliate marketing model and later Amazon.com perfected the model and still depends on affiliates for driving revenue today.

1998 – Google had indexed 60 million pages with their search algorithm and began ranking them based on back links and keywords.

Standardization of Banner Ad sizes Read more…

BrightRoll Takes on Google in $7.6 Billion Video Market

From Bloomberg

ImageGoogle Inc. (GOOG), the world’s biggest seller of Web-search advertising, is getting one-upped in the surging $7.6 billion market for online-video ads from a six- year-old startup one-tenth its size.

BrightRoll Inc., a San Francisco-based company that helps marketers place video ads on websites, has surpassed Google when ranked by number of online video ads in two of the last three months, according to researcher ComScore Inc. (SCOR)

Google makes money from selling slots for commercials that run before users view clips on YouTube, which it owns and operates. BrightRoll matches marketers to competing websites, and takes a cut. That has helped it to siphon advertisers away from Google in a market that, according to AccuStream Research, jumped 52 percent last year as more people watch television and movie programming online.

“BrightRoll and Google are neck-and-neck,” said Dan Piech, a senior product manager at ComScore. “BrightRoll has been doing an amazing job in growing their business.”

Like an old-fashioned ad agency, BrightRoll acts as an intermediary between marketers and content providers. Instead of buying ad space during a television show on behalf of clients, BrightRoll finds websites and companies seeking to run video ads, gets them together, and then takes a cut when they make a deal. While Google concentrates mainly on selling ads on YouTube, the biggest Web-video site, it also competes with BrightRoll with a similar agency-style service.

BrightRoll has kept up the pressure by offering advertisers a network of more than 6,000 mobile applications and websites to target a wider audience, and also offers tools to help them measure the effectiveness of their campaigns. Read more…

PPC Advertising for the New Year

Many advertisers will continue into the new year with the same approach to PPC they used last year. The key is to use what is working, but to look ahead at approaches that can help reach your goals and take you to the next level. Here is a simple way to kick off planning without getting buried in grids, charts, and endless PowerPoint documents.

First, take a look at your goals. Start with the organizational top-down approach to determine how goals at each level can be accomplished through PPC.

Next, determine the best strategy, or combination, to reach your goals. This could range from branding efforts to detailed sales or lead acquisition approaches. Note the timing for each.

basic-goals

In the above hypothetical example, we’ve been able to very simply gather our main goals, define them, and prioritize them by date. We have efforts to focus on in January, March, and June. Next, we want to consider the best PPC tactics to implement for each. We can consider: Read more…

Company Spotlight: Oversee.net

From Crunchbase:

downloadOversee.net operates a global online performance marketing traffic network that generates pre-qualified consumer leads for online advertisers.

It owns and operates lead generation websites in the travel, consumer finance and online shopping verticals that produce over 14 million consumer leads per month for advertising partners. Sites include LowFares.com, FareSpotter.net, AboutAirportParking.com, CreditCards.org, BadCreditOffers.com, ShopWiki.com and CouponFinder.com.

In 2002, its DomainSponsor business unit was the first to offer owners of undeveloped domain names the opportunity to monetize the direct navigation, organic traffic hitting their domains. Its self-learning technology platform displays highly relevant PPC ads on these undeveloped domains. The combination of strong direct navigation/organic user intent and highly relevant PPC ads produces favorable conversion rates for online advertisers. In January 2011, it announced a new technological development that expands beyond PPC to now include CPA and CPV monetization options for publishers. This new technology also allows advertisers to directly bid on and acquire the traffic on on the DomainSponsor platform.

Oversee.net was founded in 2000 and is headquartered in Los Angeles, California with additional offices in New York City and Frankfurt, Germany

Click Arbitrage

Orginally published back in 2007 on Yahoo Voices

…Almost everyone and their mother has heard of Google, because right now it’s quite possibly the most well-known Internet entity that there’s ever been. On the other hand, a lot of people don’t remember 2nd or 3rd tier search engines like Northern Lights, Ask.com, Lycos, or AltaVista. As a result, the prices to advertise on 2nd/3rd tier search engines is much lower than it is to advertise on 1st tier engines like Google or Yahoo. Differences in prices like this example is the foundation of how Click Arbitrage works — you simply buy traffic where it’s cheap and figure out a way to redirect it to people who will pay for the traffic.

Most things are easier said than done, and this is no exception, but it’s by far much easier and less risky than nearly any other money-making proposition on line I’ve ever heard of. The method most commonly used for this sort of thing is a model that goes something like this. First you need a website that is based on some niche. For the purposes of this article, we’ll say our website niche is clothing. Well to make money with this site with Click Arbitrage, I’ll need two things: 1. A way to buy traffic to send to the site, and 2. A way to sell traffic by ending send it from our site to another site.

For the first part, we can use some sort of paid advertising. MSN’s adCenter has been running campaigns lately giving away anywhere from $50 to $200 in free advertising credits, so that might be a good place to start looking. For the second part, we can use different services to host advertising on our pages, and set up our sites so that we are implicitly trying to get the visitors to investigate the offers the advertisements are describing. Usually this part is free, and I think currently Google Adsense is the most popular advertiser used. Read more…

Company Spotlight: Netseer

thI was checking out Netseer today. It’s a pretty interesting company with an impressive management team. CEO John Mracek has had long career in tech spanning from AdKnowledge, Adobe, Apple and Yahoo.

According to CrunchBase, “NetSeer has created concept-based advertising, a breakthrough product that matches search queries and Web page content to relevant ads, without relying on keywords alone; this allows placement of richer, more relevant, and more profitable ads for both high value keywords and those keywords with little or no value today.”

Netseer’s technology can give publishers a lift in monetization and make media buys much more effective when it comes to lead generation, clicks, or online engagement.

The company received funding from Mission Ventures and OnSet Ventures.

There’s not a lot in the news recently about Netseer but I did see that Kevin Downey, a former BD, just joined AdMant, another company in the contextual ad tech space that “offers a semantic, cookie-less solution to allow publishers, ad networks and exchanges, brand managers and agencies to develop more effective online advertising campaigns.”

~ Zorilla City

FM Acquires Lijit

lijit-logo

From Silicon Angle

San Francisco-based Federated Media Publishing, the powerhouse conversational marketing and media business, announced that they have acquired Boulder, Colorado-based Lijit Networks Inc., a leading provider of advertising services, audience analytics and reader engagement tools for online publishers of all sizes, for an undisclosed amount.

“The Lijit Networks team is just as passionate and committed to powering publishers as we are at Federated Media Publishing and that was a crucial element to this decision,” said Deanna Brown, chief executive officer, Federated Media Publishing. “Our combined relationships, proprietary tools and conversational marketing services will be invaluable to publishers and advertisers alike.” Read more…

The Social Sales Funnel

From Click Z

The traditional purchase funnel hasn’t changed much since its invention in 1898. Although there are many different versions of it, the basic “AIDA” model (awareness>interest>desire>action) remains the same:

  • Awareness. The traditional digital customer funnel starts at creating product awareness through impression-based display advertising and sponsorships.
  • Interest. The consumer continues down the purchase path when consumers demonstrate intent through behavioral and contextual signals. Those consumers can be targeted using a large variety of pre-packaged third-party segments.
  • Desire. Digital marketers capture a user’s desire, when they demonstrate affinity by clicking on an ad or visiting a product’s website. These consumers can be reached digitally through retargeting.
  • Action. Finally, the consumer purchases the product, at which point she “drops out of the funnel.” Read more…

Wired: Amazon Gets Serious

From Wired

Amazon is more serious about the ad business than previously believed: The e-commerce giant has reportedly just built a lightning-fast platform to deliver highly targeted ads to shoppers who leave Amazon’s virtual selection to peruse other sites.

Amazon has built its own “real-time bidding platform,” Ad Week says, meaning it has developed software to analyze your Amazon shopping patterns and then follow you around the web to non-Amazon sites with targeted ads – all in the blink of an eye. Better still for Amazon, it can make additional money acting as a middleman for other advertisers who want to use this technology, especially the companies that make products sold through Amazon.

It was already known that Amazon was dabbling in this field; as we reported in October, Amazon began offering real-time bidding to other advertisers earlier this year, contributing to the company’s estimated 2012 ad revenue of $500 million to $1 billion. But that offering was launched using technology supplied by other companies. Essentially Amazon provided a wrapper around services supplied by ad-bidding specialists like Triggit. While the business of targeting ads at users in real time is well established, involving exchanges run by familiar ad suppliers like Google and Facebook, the process of actually buying ads on those exchanges is complex and typically left to the likes of Triggit. Read more…

Amazon: The Next Big Media Company?

amazonFrom Wall St. Cheat Sheet

While Google (NASDAQ:GOOG) dominates the display ad market, Amazon (NASDAQ:AMZN) has all the tools necessary to build a successful advertising business of its own: it has already established its Amazon Advertising Platform, it commands a wealth of information on consumer shopping habits, and Amazon Web Services has developed connections with media companies’ platforms that could allow Amazon to run ads alongside their content.

Over the past year, the Internet retailer has harnessed these strengths to develop a proprietary real-time bidding platform that is expected to cause waves in the advertising industry, according to Adweek. As sources familiar with the company told the publication, the platform will be introduced as early as the first quarter of 2013.

Can Amazon Compete with Google?

“I think they could become one of the bigger media companies in the next five years or Read more…

Outbrain Adds Geo Targeting

Got this email today…

Hi there,

With our new geotargeting feature, you may recently have adjusted the geo-targeting settings on your campaign to US only.

This means while all of your traffic is now from the US, you may have experienced less clicks and traffic because you narrowed your selection down from Global.
We want to help you maximize this feature to your traffic advantage…

What’s Geotargeting? 
You can now geo-target your traffic by country and adjust the setting yourself.  If your campaign is currently set to global and you’d like to adjust it to one specific country, simply go to the Campaign Settings page and select “Edit” under Budget & Scheduling.

geo

Traffic Alert
As your reach is no longer as broad, we recommend you raise your CPC a few cents. eg from 10c to 15c  to build up your reach and exposure again in this new market setting.
It’s similar to when you first started your campaign. Our recommended starting CPC was a little higher at 15c to ensure you had enough reach across our publisher sites to get your content exposure and therefore, clicks. If you narrow your market selection (ie the number of eyeballs your content is exposed to!) and your CPC is too low, you may experience lower clicks and limited reach.  Read more…

AdBrite’s Exchange Focuses On Video And Mobile

logoAdBrite morphed into an ad exchange platform four years ago after shifting gears from its ad network beginnings, but the company was never recognized for making the full leap. Back in May, its board decided it was time for a change and brought in former Yahoo/Right Media executive Hardeep Bindra to make the evolution complete. He was joined by former Yahoo colleague and Oracle technologist Joaquin Delgado. Over the summer, the company added John Underwood to run business development. We spoke with Bindra about the progress the team has made and how video and mobile offerings are being positioned for 2013.

AdExchanger: You arrived at adBrite last spring. What led both you and the adBrite board to decide on bringing you in?

HARDEEP BINDRA: adBrite had been looking for a management team that could come in and recast the business for their initial review. Iggy Fanlo had been running the business over the last few years.  There’d been fits and starts in the adBrite exchange, so to speak. There was development on the marketplace side, on the revenue side, on the business side.  There wasn’t a clear direction in terms of what adBrite wanted to be as it grew up. Read more…