CBS stations’ local ad network

It warms my cockles to see a local blog ad network start, especially from a company as big as CBS’ station group.

They just announced a new widget ad network in 13 of their local markets (the owned & operated stations with newsrooms). In a week and a half, they’ve put together 80 blogs in the network, many more to come. They are all local blogs around various content interests: news, politics, sports, real estate, entertainment. This is pretty much just an ad network rather than a curated ad-and-content network like Glam. CBS intends to send the blogs some traffic, but unlike Glam, it’s not aggregating and curating their content. They’re looking for decent blogs that are local and are updated regularly, but they’re not yet turning this into a contest where the best quality wins (that day will come, I hope). When I spoke with them, they did add that they’re delighted with the quality of the local blogs they’ve seen.

You can see an example of the ad unit here and here: a constant feed of content (video stills in most cases, text in others) over an ad unit. So far, they’ve sold AT&T, Liberty Mutual, and the Honda dealer group in Dallas. They will sell in both local and national ads; it’s too soon to know what that mix will be, but they anticipate about an even split.

This is a model I like and one I’ve been pushing with companies I know: You could look at this as an ad with content attached or as content with an ad attached. So the blogger gets an ad, revenue, a some small dollop of content, and an association with a major media brand (which some still value). The station gets to push its advertiser as well as its content and brand and gets an association with those cool bloggers and its gets new inventory and audience. The advertiser has a better idea of the environment because there’s content next to the ad and because the station picks the blogs. What’s not to love?

The CBS unit also carries the local station’s branding plus a link to a pitch to join the network. Here are examples of the units.

I spoke with Jonathan Leess, president and general manager of the CBS station digital group, and Aaron Radin, senior vp for their ad sales and biz dev. They understand that this is not just about driving traffic to CBS domains but about reaching audience they may not now serve in other places. That’s the attitude.

I had to pull numbers out of them like baby teeth. They’re telling the bloggers to expect an effective CPM of about 50 cents but they quickly acknowledge that they’re subsidizing and backfilling the network, which is brand new. That is, they’re not yet selling the high-value ads and they’re not selling out, so they are putting in lower-value advertising in some cases and throwing in a subsidy on top. So that’s the net-net bloggers can expect today. But that’s not the value they’re selling to advertisers. That, they said, is more like a $10 CPM (though all life is negotiable). Compare that with $8-20 CPMs on CBS domain banner ads and $16-25 on video inventory. If they can sell a CPM approaching a double digit for local blogs and sell through enough inventory, that could be healthy. In the end, I ask, what will the value of a network impression be relative to a CBS domain impression? Again, it’s too early to say, but Radin guesses one third to one half.

They hope to add 20 million incremental (that is, new) ad impressions per month per market, though they’re quick to add that their goal isn’t just ad impressions but also new audience. Amen. And note that they’re pushing not just web pages but also those high-value video views. Leess and Radin said they serve 20-25 million streams a month, about half of that from the stations’ sites and half from syndication to Yahoo.

By the way, Buzzmachine is not local so it won’t qualify. Drat. When will somebody start that media wonks’ network?

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  • http://adroll.com Jared

    Hi Jeff-

    > When will somebody start that media wonks’ network?

    Well, would you be willing to start a “Media wonks’ network” – especially if you had some help with the platform and sales? :)

    -Jared

  • http://www.stateoflocal.com Rick Ellis

    I’ve blogged a lot about the idea of local ad networks, and I think it’s a great idea in the abstract. This CBS plan is a small step, but I think the positive reaction it’s getting from the industry has more to do with the idea than the actual results.

    For one thing, the ad side of this is problematical for both the bloggers and the advertisers. For the bloggers, getting an effective CPM of about 50 cents isn’t a great deal, considering the amount of sidebar space that many of the sites are giving up in return.

    For advertisers, it’s not clear that these skyscraper ads (or other smaller ad units) are any more effective than they are on many of the traditional media sites. From an advertiser standpoint, it would make much more sense to offer up Adsense-style CPA text ads, which is done correctly can be much more engaging than a banner ad.

    My experience on my personal site with a similar offering from NBC’s “The Today Show” was that the effective CPM never broke the $1 mark. And if you’re running any kind of effective web site, you should be able to beat the with Google Ads or remaindered ad inventory.

    Rick Ellis
    StateOfLocal.com

  • http://www.methodsreporter.com Brad Flora

    I publish a hyperlocal Chicago news site, The Chicago Methods Reporter, and have been absolutely bombarded with invites to this ad network. I was intrigued until I learned that the banner takes up a lot of space and payouts are weak at this point. Until this gets up into the $5-6 I don’t see it providing much value to publishers like me. We’re certainly not going to run it. Like you said Rick, we do better off Adsense and even *couch* Adbrite at the moment.

    Brad Flora
    http://www.methodsreporter.com

  • http://coastsider.com Barry Parr

    I floated the idea of local ad networks at the Networked Journalism conference in NY. I’m very enthusiastic about the idea.

    But I don’t like this execution. The ad formats are too big and nonstandard. I’m using IAB standard ad units on Coastsider, but it looks like CBS is wrapping the (IAB standard) network ad in the local CBS identity and content widget.

    If Channel 5 would like an ad on my site, I’d be happy to sell them one. The CPM on my book rate is $20, but they can get a discount if with a longer contract.

  • http://darleeneisms.la darleene

    Hm. I wonder, being a CBS Local employee, if I’d be allowed to participate and get paid too.

  • http://www.Viralyticsmedia.com Mike Sutcliff

    The only ad network I have ever had success with was ViralyticsMedia.com. They are more of a site repping company, but if you can get in with them they are pretty solid. Customer support sucks, but they pay well.

    Mike
    StupidVideos.com

  • http://www.ranchocordovapost.com Geoff

    I would be intrigued to see if hyperlocal news publishers could band together and form a national local network to sell local advertising into?

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