Why the world needs branded expert networks

It's been a dramatic few weeks in the online advertising world. News Corp. bought the Wall Street Journal http://online.wsj.com/article/SB118463978304868582.html. AOL bought Tacoda http://news.zdnet.com/2100-9588_22-6198613.html. Adify announced that over 35 branded expert ad networks have launched in under six months http://www.adify.com/Pr7_30_07_35Networks.htm.


OK, so the Adify news wasn't in the same league as AOL or News Corp./Wall Street Journal. But interestingly, Adify and our offering were often mentioned in stories about these transactions. Is the world (at least the online advertising world) recognizing the need for branded expert advertising networks?


First - examine Tacoda. Tacoda offers better targeting within remnant inventory. AOL recognized that Ad.com sells a great deal of remnant inventory by broad (or not so broad) category and saw that higher rates could complement these sales with Tacoda. AOL has always been a direct marketing powerhouse and this fits their core competency. And AOL is offering brand advertisers premium position and integrated sponsorships throughout the AOL properties. AOL could aggregate more audience for those brand audiences by creating expert (i.e. an edited, selected, premium collection) ad networks where advertisers have the visibility and control they like with AOL premium and the reach Advertisers like with Ad.com and Tacoda.


Sramana Mitra, on SramanaMitra.com wrote a compelling analysis of the Wall Street Journal deal and followed up with an answer to the question - What Next, Wall Street Journal? http://sramanamitra.com/2007/07/31/murdoch-gets-dow-jones-now-what/ and her advice - leverage your compelling brand and ad sales prowess to create expert branded ad networks. This would enable the Wall Street Journal to bring more of the valuable audience their advertisers crave without sacrificing the control and visibility their advertisers demand.


The web is expanding. Jeremy Liew, a partner at Lightspeed Venture Partners, captured this dynamic in his analysis of why it good to be quality content and build expert ad networks. http://venturebeat.com/2007/07/24/ad-networks-why-it%e2%80%99s-better-than-ever-to-be-a-targeted-content-site/. Advertisers want to reach their audiences in premium settings where the audience is engaged and the content is compelling. Media companies (and entrepreneurs) are recognizing the opportunity to leverage their editorial expertise and advertising relationships (and brands) to transform this expansion into an opportunity to build next generation networks - where content is not necessarily owned, but is high quality and attracting an audience. Adify is working with many media companies and entrepreneurs who are seizing this opportunity - and it's been exciting to see the deals that reinforce the role of branded expert networks in the next evolution of the Internet and advertising. What's the most exciting new branded expert network you've discovered?

Adify and Ad Servers

What’s the difference between Adify and an ad server? Adify offers a world-class ad server AND Adify has layered significant network management, advertising optimization and payments technology into our ad server. The difference is that without Adify, network builders would have to create or integrate those technologies to build, manage, and maximize a vertical ad network.


Initially, setting up a vertical ad network seems easy -- sign up a few publishers, get some advertisers, traffic some ads, and you’re off and running. But, like most things in the online advertising world, the reality is not quite that simple. The problems crop up from selling advertising on sites you do not control and ensuring advertisers and publishers each have control over their destiny.


First, take the challenge of signing up publishers. Some networks start with "owned and operated" sites, which the network controls completely. However, the benefit of an expert vertical ad network is delivering advertising to the sites where the audience actually is– not just on the properties you control.


Consider the complexity of your relationship with these independent publishers that you are now inviting to your network. What types of sites will you accept into your network? How will you review them? Adify has an interface that allows you to do just this. What content standards must they adhere to? Adify enables you to publish the requirements for your network. Who will review their content to ensure it’s compliant with your standards, and how often will that happen? How will you split your advertising revenues with the sites and ensure they’re paid on a timely basis -- even if your advertisers don’t pay their bills on time? Adify calculates all the payments and is an outsourced payments processor.


Next, consider selling advertising. In a world with "promiscuous" sites that sample every ad network out there, what will keep the sites sticky to your network while you’re busy launching it? Adify Media sells advertising across all networks powered by Adify who want it. What ads will run while you’re waiting for your sales team to bring in some campaigns? Adify Media, again. How will you promote the sites in your network? An Adify Network Storefront Widget on your homepage can do this. How will you publicize your network and attract new publishers and advertisers. Adify’s Featured Networks (link) and Adify marketing services can help.


Finally, as you entice advertisers to buy on your network, you will need to traffic their ads onto the sites in your network. How do you distribute and optimize a campaign across an arbitrary collection of sites that might change over time and which may have different commission structures and contractual agreements with your network? Adify has an interface just for that – you can use it, or you can have Adify do the trafficking for you. As your network evolves, how much inventory will be available for the new campaigns as you bring them on? Adify provides analysis for inventory planning and management. Will you be able to traffic and optimize Flash, Pointroll, and other innovative formats that advertisers demand these days? Adify does.


Adify focuses solely on enabling successful expert vertical ad networks, so we have faced all these challenges time and time again, and we are continuously refining our processes and product to help network operators leap over these startup hurdles and focus on the business and marketing challenges of scaling their networks. In particular, in our product management team, we are hard at work at improving our tools to enable network operators around the globe define a new ad network, add sites to it, and traffic complicated insertion orders in minutes.


Adify has a world-class ad server and considerable network building technology on top of it. Adify’s platform infrastructure and integrated services allow literally anyone with a vision for building and managing an ad network to do so from their desktops, empowering experts at small and large companies alike. Our team has successfully launched 35+ networks to date and through that we’ve collected the hard-won experience to deliver the products and services that enable you to extract the greatest value from bringing together advertisers and their desired audience through an expert vertical ad network.

Media Planning Matters

TiVo announced this week that the most popular TiVo Stop|Watched advertisements were from Cort Furniture Rental, Domincan Republic Travel Bureau and Bowflex (http://www.businessweek.com/brandnewday/). According to BusinessWeek, these ads were very clearly selling a product and often with an 800 number as well. And the reason they succeeded was they were placed exactly with the content that attracted their audience. Media planning and campaign message were perfectly aligned to get results.


Adify sees the same trend as TiVo playing out on our expert vertical ad networks – ads that are built for a specific audience and placed on a vertical ad network that specifically caters to that audience easily outperform industry averages.


For example, one advertiser is running a specialty dog food campaign on a vertical ad network for passionate dog lovers, breeders and their vets. The creative speaks to the dog professional and the media planning leveraged the expertise of one of Adify’s Network Builders – a dog expert. The CTR is more than 3x the industry average. Another advertiser is running a more generic campaign that they placed in a custom-aggregated back to school channel that leverages multiple Adify networks. That campaign is performing because of the expert vertical ad networks – it would soar with creative that matched the audience.


Research announced this week challenged the focus on clicks and emphasized that brand advertisers need to measure the advertisement's effectiveness by measuring the impression it made on the viewer. Andrew Shrock captures this discussion on Technology Review. For an advertisement to make an impression - it must clearly have a compelling message for the audience congregating on the media where it run.

The continued fragmentation of the audience presents a challenge to advertisers –advertisers (and their agencies) have to offer creative that speaks to narrower audience interests while buying media to access that specific audience. The ads don’t have to be dynamically generated – knowing and talking to your audience is key in a fragmented media universe. Fragmentation forces media companies and advertisers to take our game to the next level with compelling creative and innovative media planning since the days of the audience aggregating on 3 TV channels or 4-6 web sites are long past.