Posts about Ad

Open ad marketplace, continued

Pat McCarthy replies to Chas Edwards’ questions about value in an open ad marketplace:

Just because an open ad marketplace is “frictionless”, doesn’t mean these same advertisers couldn’t find these same high quality publishers and advertise on their inventory. The value of an auction is that it bids the value of inventory up. If Fred Wilson’s blog advertising was available in an open marketplace, he could still get a premium for his inventory, and only accept advertisers he wanted to work with.

:LATER: Zach Coelius, who’s starting an ad network and technology company, also responds. Note that Triggit, his company, now has an ad relationship with LiveJournal.

Open ads

More discussion about the notion of open ad networks: Here‘s the response of Chas Edwards of Federated Media to my post and column and here’s my reply.

The value of us

The Center for Media Research reveals that ad spending on citizens’ media (aka user-generated content, ugh) is doing the hockey-stick:

…[A]dvertising spending on user-generated online media – blogs, podcasts and RSS – did not begin until 2002, but this combined spending has grown to $20.4 million by the end or 2005, a 198.4% increase over the 2004 level. Spending on blog, podcast and RSS advertising is projected to climb another 144.9% in 2006 to $49.8 million. Some of the key growth drivers are continued audience fragmentation, the perceived ineffectiveness of traditional advertising, and the desire to reach the elusive 18- to 34 year-old demographic.

Some key findings:

* User-generated media remains primarily national in scope with 98.1%, or $20.0 million, of all advertising spending coming from the broader market in 2005.

I predict that the next phase will have local and nicheier content growing as the infrastructure for advertising on them gets easier and as smaller advertisers discover and learn about the opportunty.

* Blog advertising accounted for 81.4%, or $16.6 million, of total spending on user-generated online media in 2005, but blog ads will comprise only 39.7%, or $300.4 million, of overall spending in 2010

… as other citizens’ media — podcasts, vlogs, wiki products, and things not yet invented — grow. Witness:

* Podcast advertising totaled only $3.1 million in 2005, but is projected to reach $327.0 million in 2010, when it will account for 43.2% of all user-generated media advertising
* Spending on RSS (Really Simple Syndication) advertising totaled $650,000 in 2005 and will grow to $129.6 million in 2010
* Total spending on user-generated online media is forecast to grow at a compound annual rate of 106.1% from 2005 to 2010, reaching $757.0 million in 2010
* Technology was the largest single category at $4.0 million in 2005, due primarily to the technology-savvy early adopters of user-generated media
* Auto was the second largest marketing category, generating $3.9 million in 2005, as car manufacturers utilized user-generated media to market their higher-end models to the “influential” demographic…

[via MIT Advertising Lab]

Here’s my latest Guardian column pushing the idea of an open ad marketplace to support and explode citizens’ media. Much more on this later.

Fred and Barney meet

Two groups of media’s moneymen held their confabs this week and they each spent some time self-flaggellating, as well they should.

The Times reports from the American Association of Advertising Agencies:

“I think our industry would be better if agencies were as comfortable with change as we like to tell clients they should be,” said Ron Berger, chief executive and chief creative officer for the New York and San Francisco offices of Euro RSCG Worldwide, part of Havas.

“I think our industry would be better if all of the people who speak at industry functions and say ‘It’s all about big ideas’ actually had a few” …

And Jon Fine reports in Business Week on the meeting of the Newspaper Association of America:

This year’s opening event was at the magnificent Field Museum, on a large open floor bookended by two massive dinosaur skeletons. Many attendees joked about this. To the executive to whom I said such an obvious metaphor would never, ever, appear in this column: I lied….

At the podium, Jay R. Smith, Cox Newspapers’ president and outgoing NAA chairman, gives a valedictory with the broad theme of “stop whining.” It begins with and repeatedly uses the phrase, “It wasn’t supposed to turn out like this.” He also says: “The world changed a lot. Newspapers changed a little.” …

And Washington Post Publisher Donald Graham tells the group when discussing newspaper strategy that “the only honest answer is we don’t know how our future will work out.”

OK, let the flaggellating end. Let the overdue strategizing finally begin. The time for mourning the past is long over. The time for shrugging at the future is over, too. You no longer get points for admitting that you’re in a mess. You only get points for taking brave action to get out of it.

Who needs media?

This is an advertiser’s wet dream: to create media so you don’t have to buy time or space on it. Bacardi is launching a 24-hour music channel.

B-Live – a 24-hour, online music station – is planned as a long-term project that will eventually enable listeners to supply content.

The service is the latest example of a brand attempting to bypass more traditional forms of advertising and appeal to consumers directly….