With "The New York Times" reporting that there are more than 200 ad networks operating in 2008, and other sources putting the number at twice that, it's clear that e-tailers have lots of options for marketing their Web shops in these channels, said Robert Tas, founder and CEO of Sportgenic, a network targeting sports enthusiasts. But, how do you figure out which ones will work best for your particular e-business?
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Tas, in an effort to educate Web shop owners new to the ad network game, wrote a white paper on the topic and spoke with E-Commerce-Guide.com about the highlights — exactly what ad networks are, what they can do for you and how to choose one.
Ad networks, put simply, aggregate online advertising inventory from a variety of sites and provide a single solution for the advertisers, said Tas, with business owners working with the network to buy advertising across some or all of the sites they represent.
Times Have Changed
When ad networks first appeared in the late 1990s, he said, they were not researched well, and therefore, not very popular. "By aggregating pages across a huge number of not-well-vetted sites, advertisers had little or no control over where their messages ran or if they appeared on inappropriate content. So, advertisers placed minimal value on networks as a whole, or were simply unwilling to run messages on them."
Now, all that has changed. Tas said the industry cleaned up its act by making significant improvements in the quality of sites offered and offering contextual and behavioral ad placement as well. As a result, currently advertisers use networks for the six following functions, as outlined by Tas:
- Behavioral targeting and re-targeting
- Easy-to-reach vertical targets, such as auto buyers, or women or sports enthusiasts
- One-stop advertising on long-tail sites
- Connections to the passionate, or those people demonstrating loyalty to a brand
- Large amounts of exposure on short notice
- Broad reach and heavy frequency beyond the reach of portals
Maturity Brings Specialization
In addition to improvements in the quality of ad networks, there are now different types. The general interest ones are called horizontal networks, such as ValueClick.
Vertical networks specialize in a particular type of content or audience, and represent only sites related to that topic. Tas cited the following as examples: Glam Media, representing sites targeting women 18 to 49, his own company, which focuses on both sports fans and participants, and Jumpstart Automotive, which aggregates auto impressions across auto sites and its network.
A third type of ad network and relative newcomer is called the platform network, designed to take advantage of emerging digital platforms, such as mobile and console gaming, Tas said. Examples include Ad Infuse, AdMob and Double Fusion.
"As the number of ad networks has increased, so too has the degree of specialization in the category," said Tas. "But the basic concept — aggregating impressions across sites so that marketers have an easier way to reach consumers, and take advantage of better targeting — has remained the same."
Hot Trend: Vertical Networks
Though there are three different types of ad networks, vertical networks are the ones that have been gaining popularity. He points to numbers from Lehman Brothers showing 43 percent growth in overall ad spending on vertical categories in 2007, compared to a 5 percent drop in spending at general portals.
"The Web is fragmenting, and to capitalize on that, you need a vertical ad network that has expertise in the specific area you want to reach, whether its travel, an ethnic group, say Hispanics, or sports, because they know where and how to reach these people without being intrusive," said Tas.
Finally, if you're wondering if ad networks are affordable for small Web shop owners, the answer is "yes." Tas said he has one client, he dubbed as, "the next Gatorade," that advertises with Sportgenic to target endurance athletes. "Lots of up-and-coming companies can afford ad networks because many work for all scales of businesses," he said.
He outlined the following benefits for advertisers as the reasons why verticals are taking off: quality content for ad serving, the targeting of extremely passionate viewers and the ability to have custom campaigns created.
Nine Questions to Ask When Choosing a Network
Tas also shared his checklist for choosing an ad network. Here are his nine tips:
- What are the site quality standards of the network? How do they decide whether a site is good enough to run my advertising? The network should have impeccable standards to ensure your ads run in brand-enhancing environments. Running next to the wrong kind of content can do damage to a brand.
- Is the network willing to share its site list, as well as the actual site list on which my ads will run? You have the right to know where you will be advertising. At a minimum, you should see the site list of your campaign.
- What is the reach of the network to my target audience? Reach isn't everything, but working with larger networks makes the job of buying, reporting and optimization easier.
- How robust are the targeting options? Can they pinpoint my audience? Can they segment my audience and offer tailored campaigns? Digital advertising is getting increasingly sophisticated, and the capability to offer these will become increasingly important over time.
- Does the network offer me opportunities to develop programs across digital platforms such as mobile, widgets, social media and gaming? Audiences are fragmenting across platforms. Having a network that can offer you platforms beyond PC-based Web pages will make it easier to migrate more and more of your advertising to follow your audience in the near future.
- Is the network growing? Are the sites within the network growing? The health of the network will give you a sense of the passion that the audience feels for the sites, and by extension, the advertisers.
- Does the network have exclusive representation agreements with its sites? Exclusive representation means you will be getting the best ad placements available.
- What are the reporting capabilities of the network? Can I see them before I buy? Can it be integrated into my current reporting platform? The network you choose should make these critical tasks easier, not harder.
- Is the sales rep I would be working with responsive? Do they strive to meet reasonable requests and deadlines? Personnel is critical; the staff should make your job of planning, buying, reporting and optimizing easier, as well as offer ideas for improving your campaign and ways to plan for the future.
(Editor's Note About Robert Tas: Prior to creating Sportgenic, Tas was senior vice president of media and technology for 24/7 Real Media. During his tenure, he closed deals with Marketwatch.com, USA Today, Discovery, 800Flowers and others. Previously, he also helped launch Tacoda Systems, a behavioral targeting software and network firm.)
Michelle Megna is managing editor of ECommerce-Guide.com.
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