TechMeme’s Excellent (& Simple) New Blog Ads

27 09 2006

He takes feeds of the latest posts from sponsors’ blogs and puts that in an ad box on Techmeme. That’s their ad. It’s brilliantly simple: dynamic advertising controlled by the advertisers, who will make their ads - their content - relevant to the readers who see their feeds on Techmeme….

Gabe is charging $4,500, $3,500, and $3,000 respectively for the three month-long spots (I’ll save you the cipherin - that’s $132,000 per year). For the advertiser, that works out to a $5-8 CPM, which is good.

I definitely agree on the excellence of the idea… For years now, the advertising network folks, (including me while @ Miva) have been talking about how advertising is becoming the content, with this being the perfect pinnacle of that concept - 0 incremental maintenance on the advertiser side, and assistance in feeding the sucking content creation monster, while making money on the publisher side - what the heck’s not to like? :)

At some point down the road would definitely love to have something that does a contextual match between any given post on the publisher’s side, and X back on the advertiser’s side, to maximize both relevance of the content & CTR, but first things first, and definitely agree with Jeff Jarvis - would definitely be an ad unit that I would think about using myself! :)



MR: Internet Ad Revenue Up 37% to $7.9 Billion in First Half of 2006

27 09 2006

New York - Internet advertising revenue rose 37% in the first half of 2006, compared with the same period a year ago, to $7.9 billion, according to a report from the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers. Revenues for the second quarter of 2006 also eclipsed $4 billion for the first time — a 5.5% increase over the first quarter — and represented the seventh consecutive quarter of growth for the online ad market. While search ads sold by firms like Google maintained their 40% share of the market from last year, “displays” like banner ads and rich media ads dipped slightly from 34% to 31% of the market, and online classifieds were up a bit, from 18% in the first half of 2005, to 20% in the first six months of 2006. “While search advertising remains the largest format in terms of revenues, we expect to see new formats like video ads to continue to emerge as advertisers seek to leverage the branding opportunities afforded by the growing installed base of broadband users,” said David Silverman, a partner in the entertainment and media practice at PricewaterhouseCoopers.

More…



Branding to Convert PPC

8 06 2006

Some very good info as to the effects of brand terms, query phrase complexity, (i.e. how many words are in a query) and number of ad clicks on conversions, from PPC ad copy through on-site copy. Looking forward to reading the full report at some point. Some highlights:

  • The highest conversion rate (9.30%) resulted when the user’s first click and last click on a marketer’s paid search ad were both brand terms
  • When the first click is on a non-brand term and the last click is on a brand term, the conversion rate is almost as high (8.73%)….These conversion rates are seven times higher than when there are only non-brand terms.
  • Conversions also rise as consumers enter more unique keywords. Consumers entering multiple unique keywords accounted for 8.39% of the sample studied, but they accounted for 19.2 % of transactions
  • Searchers who clicked on two unique keyword ads are more than two times more likely to purchase than searchers with only one keyword exposure.


Yahoo debuts improved PPC

7 04 2006

Good for them for adding CTR as an element of PPC ranking, rather than just pure $. Interestingly enough, though I’m sure there are Yahoo ad sales guys choking right now, really should be a big gain all around:

1) For the high-paying advertiser, he’ll only pay now when his offering, (or at least his ad text) is actually relevant to the search occasion itself, thereby improving his odds on the conversion side,*1*

2) For the high-relevance advertiser, he won’t have to keep being held hostage by being outbid by a bunch of less relevant advertisers who just beat him out on bid price.

3) For Yahoo, CTR goes up, as more people find the ads more relevant, which means that their overall revenue goes up - remember, in the standard bid-price only sort, the high bidder gets position #1, but if position #1 is not strongly relevant to the actual search occasion, no one clicks on, and thus not only does Yahoo not get the $1 the poorly-relevant high bidder bid, but they also don’t get a chance to get the $.15 that the highly-relevant, but less-wealthy advertiser bid for the same phrase, so ends up getting nothing. By including CTR, (depending on the degree to which CTR is a contributor, of course) if the high bidder is also the most relevant, Yahoo gets the $1. If not, Yahoo at least gets the $.15, rather than the 0.

4) For the end-user, especially on economically-oriented queries, (mortgage, Viagra, “mesothelioma lawyer”) they get a second set of sources that now become much more valuable to them.

———

*1* Yes, it will mean that he’ll need to start paying more attention to his conversion strategies, rather than just simply firing large sums of money out, and relying as heavily on the laws of big numbers to help, but in the long run, that’s also good for them in terms of improving their ROI.



Yahoo Bans The Little Guy

15 03 2006

It’s been legal in both advertising and just about everywhere else pretty much for as long as anyone can remember, (so long as you tell the truth) but apparently as a result of Mazda actually being, oh intelligent, and bidding on comparisons between the Pontiac Solstice and its Miata, (i.e. “Pontiac vs. Mazda” or “Solstice vs. Miata” - thereby spending only thousands when Pontiac spent millions on product placements to get on The Apprentice last year to get similar results) as of March 1, Yahoo no longer allows companies to bid on their competitors’ trademarks for comparative purposes, even though such “Comparative advertising in itself is proper and legal…” according to Peter Raymond of the law firm Reed Smith in NY.

But don’t worry, if you’re a reseller of the trademarked item you’re good, or, if you’re a comparison site so long as you “provide substantial information about the trademark owner,” golden, just not if you’re one of the parties actually being compared. Hear that, Mr. Dreamer working on the next Great American Gadget? Hear that Mrs. Nutcase trying to offer that truly better, more personalized service when everyone else is cutting back on theirs? No compare with Big Boys for you - NEXT!!!!



2006 May See $292 Billion in Advertising Expenditures

4 01 2006

Hmm - didn’t know that Cable TV advertising was that hot. Other than that, certainly more confirmation of good news in the Internet sector.

The recent issue of the Universal McCann Insider’s Report presented highlights of Robert J. Coen’s 2006 advertising predictions delivered at the December UBS Global Media Conference. Coen prefaced his presentation by noting that in 2005 the U.S. economy expanded a little more than had been expected, but advertising growth has failed to outpace 2005’s nominal GDP growth of 6.3%.

In 2005, the article reports, national marketers continued to be overly cautious despite the relative improvement in economic conditions. Because company stock prices remained below previous highs all expenses, including those for advertising, were firmly controlled in 2005. Strong resentment of recent high media price increases was widespread and, as ad demand slowed in the year following the Summer Olympics and Presidential election. The pressure for measurable evidence of the return on advertising investments grew. These and other forces combined to interrupt the expected renewal of strong advertising competition and the expansion in advertising spending. The projection for total national advertising in 2005 is now $177,147,000,000 for a gain of 6.0% over 2004. When final Fourth Quarter revenue numbers for the broadcast TV Networks are in, it is expected that the full-year gain will be at best about one percent.

2005 Budgets Of National Advertisers

% Change

Over 2004

2005 Projections

($000,000)

4 Tv Networks

+1.0%

$16,880

Spot Tv

-7.5

10,517

Cable Tv

+ 15.0

18,888

Syndication Tv

+ 3.3

3,792

Radio

+ 1.5

4,441

Magazines

+ 5.0

12,859

Newspapers

+ 1.5

7,743

Consumer Media Sub-Total

+ 3.7

75,120

Direct Mail

+ 8.5

56,627

Yellow Pages

+ 1.5

2,142

Internet

+ 15.0

7,881

Other National Media

+ 5.6

35,377

Total National

+ 6.0%

$177,147

Source: Universal McCann, December 2005

The changes in national marketers’ advertising spending in many of the traditional mass media have been modest in 2005 but one exception has been mail advertising.

In the first half of calendar year 2005, the number of pieces of mail sent at the regular standard mail rate, used for most advertising, increased nearly 5%. This trend has been influenced by the telemarketing restrictions; but it is also another indication that marketers have, in recent years, focused their marketing resources on more immediate measurable short-term responses. Coen expects that many of these programs will be continued and even expanded in 2006 despite higher postal rates and higher paper, printing, and handling costs.

Trend In Mail Advertising Pieces

1st Half Of Year

Millions Of Pieces

%Change

Change In Pieces (000,000)

2000

36,800

+ 7.1

+ 2,400

2001

37,200

+ 1.1

+ 400

2002

35,300

-5.1

-1,900

2003

36,500

+ 3.5

+ 1,200

2004

39,600

+ 8.3

+ 3,100

2005

41,540

+ 4.9

+ 1,940

Source: Universal McCann, December 2005

Total National Advertising in 2006 is expected to increase at a slightly faster pace than it did in 2005. The rate of gain in spending by National Marketers for broadcast network television ads next year will be helped by the Winter Olympics and easy comparisons with 2005. Heavy Spot TV advertising gains are anticipated next year because of the intense political contests that are due to occur in 2006.

The Outlook For 2006 National Advertising

% Change Over 2005

2006 Projections ($X000,000)

4 TV Networks

+ 6.5%

$17,977

Spot TV

+ 8.5

11,411

Cable TV

+ 7.0

20,210

Syndication TV

+ 4.5

3,963

Radio

+ 4.0

4,619

Magazines

+ 5.5

13,566

Newspapers

+ 3.5

8,014

Consumer Media

Sub-Total

+ 6.2

79,760

Direct Mail

+ 7.5

$60,874

Yellow Pages

+ 3.0

2,206

Internet

+ 10.0

8,669

Other National Media

+ 6.4

37,650

Total National

+ 6.8%

$189,159

Source: Universal McCann, December 2005

In 2006 National Advertising growth should again outpace general economic growth, but ad spending by Local Marketers is not expected to improve much in 2006. The extra demand due to political spending will put some extra pressure on local media prices next year.

The combined spending for advertising next year by National and Local Marketers is now projected for a total of $292.0 billion, a gain of 5.8% over 2005. Next year we expect U.S. advertising to approximately match the growth in the economy, but advertising as a percent of GDP will probably remain at the stalled 2005 levels.

The Outlook For Total Advertising 2006

% Change Over 2005

2006 Projections ($X000,000)

Local Newspapers

+ 3.0%

$41,360

Local TV

+ 4.5

14,705

Local Radio

+ 4.0

16,129

Local Yellow Pages

+ 3.0

12,494

Other Local Media

+ 6.8

18,158

Total Local

+ 4.0

102,846

Total National

+ 6.8

189,159

Grand Total

+ 5.8%

$292,005

Source: Universal McCann, December 2005

To read the complete article, including summary charts of 2005 estimates for various categories of advertisers, please visit the McCann report.



Internet advertising revenues surpass $3 billion for Q3; Run Rate for Full Year 2005 on Pace to Exceed $12 Billion

22 11 2005

New York, NY (November 21, 2005) – The Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC) today announced that Internet advertising revenues totaled a record $3.1 billion for the third quarter of 2005, making this the highest quarter reported and the first time that quarterly revenues surpassed $3 billion. The 2005 third-quarter revenues represent a 33.9 percent increase over 2004 third-quarter total of $2.3 billion and a 4.7percent increase over the 2005 second-quarter total of $2.9 billion. Based on historical data, the annual revenue run rate for 2005 could exceed $12 billion, well above last year’s record total of $9.6 billion.

More



Local Online Advertising A Hard Sell

17 10 2005

JUPITERRESEARCH FORECASTS LOCAL ONLINE AD SPENDING TO REACH $5.3 BILLION IN 2010; CLASSIFIEDS CONTINUE TO DOMINATE TOTAL

“….Pay-per-click doesn’t make a lot of sense if you don’t value your site as a source of leads. Pay-per-call technologies have promise, but face uncertain growth.

“A JupiterResearch/Virtus executive survey of advertisers who typically use Yellow Pages found that about 30% of the executives surveyed were interested in pay-per-call, but over 40% said they were ‘very uninterested.’”

——–

Very interesting… As most of the Search World is looking hard at trying to steal Yellow Pages business, Jupiter, of all companies - the “mad puffers to the stars,” (i.e. always take a Jupiter opinion and drop it by 4x to even approach what might be reality! ;) ) is suggesting some still fairly strong resistance to.

‘Course, won’t be the first time there’s been strong resistance to what’s been tried, but it will definitely be interesting to think about how to apply / modify / re-think the search business model around these smaller, largely non-web-based merchants, who are:

- Not used to having large marketing budgets

- Not used to doing a lot of work formally tracking and reviewing individual marketing campaigns

- Not looking to bring on additional staff to do this kind of thing, and don’t want to / can’t afford to allocate the time themselves to do*

- Are used to a fair degree of persistence to their marketing, (hey, the Yellow Pages may not generate a ton of leads, but it’s out there all year long, you pay once, and you’re done)

It’s certainly very interesting to think about how to pull off, as what this screams for is a) managed services, (i.e. offering outsourced campaign mgmt) as well as probably a much better tie in to direct sales, (i.e. CPA, rather than CPC / CPC-variant pricing).

On the first, there are plenty of folks who will counter-scream “Scalability! Services are inherently not a scalable business model,” (to which they’re certainly semi-right, at least - interestingly enough, since no one’s willing to pay for services on the Web, no one actually wants to render them rather than the absolute minimus required to generate eComm / Ad Rev cash with whatever flavor additions there are for the given site).

On the second, would suggest that a to a CPA model would be a much easier sell, which really should be little other than a pricing model switch to translate CPC to CPA @ parity cost / revenue, but that does cause problems on the B2B side with most sites that display search-related ads, in that many tend to have already extant algorithms in place to choose and display ads @ query time from particular vendors based on how much those ads will pay on a Net Bid Value basis, (a composite of multiple CPC’s) which puts some solid friction in place.

‘Course, if you have your own B2C site…. (will regale you with tales of early FAST / Alltheweb.com and the B2B vs. B2C debates - one of which led to $100M in value, the other multi-billions - some other time…. )

———–

* Hey, I’m in the process of starting up my next business, and even with a strong Online Marketing portion to my background, you know what? _I_ don’t have time to allocate to running PPC campaigns, and I know precisely how to do it, and do it well - and if someone who has lived and breathed online marketing, and knows all the great things it can do, won’t allocate the time for now to include in my start up, (i.e. I need my time to do other things for now to just get the business to live) what do you think are the odds that someone who isn’t as clear / convinced as to the value of will allocate his highly finite time to do? - BTW, for anyone who is interested, there are a couple of companies that I’ve come across that do a nice job to outsource this to where you can just give them an idea of what your product is, and they’ll figure out keywords, which ad networks to use, etc. to optimize - not cheap, but if you’re a small shop, could be a good thing to start with, and then if you do really well, and want to drop cost by bringing it inhouse, etc., you can do it then - they are Inceptor here in MA, and Adapt out on the Left Coast) .



Another Hope for Real Search?

3 08 2005

Ok, so what’s actually managed to get me out of a 10-month hiatus to actually put up another blog post? Really, podcasting, (which I’ve been falling in love with over the last 1.5-2 mths) but that’s fodder for another post, (or 2 or 12). But at this precise moment, it’s an article in the Channel Register that’s talking about Yahoo re-assembling some of the old IBM Clever guys again, with speculation toward reviving at least some portion of IBM’s old Clever project.

Why’s this so inspiring? Several reasons. I first actually read about Clever in Scientific American back in ‘98 or so. At the time, even though officially I was (and am) a business guy, I was (and am) a total tech geek, and the beauty of the system that they described was so amazingly apparent in comparison to what was out there at the time, (yes, even our friend Google, who I remember thinking was a “cheap copy” of Clever at the time - ok, “more pragmatic” copy would probably be more appropriate - Clever could take 11 mins at query time, which was, of course, ludicrous, but from deep geekdom, it was like seeing the Mona Lisa and then thinking about a poster of some other girl - the latter was much more practical, but nowhere near as breathtaking - see, told you - was and will always be, first and foremost a math geek, so I very much to this day see beauty in elegance rather than bludgeon) that I literally fell as close to in love with a search technology as one could.

Actually, not too long before the time that that article came out, I had been working on a business plan for a new kind of search engine for the business plan competition as part of my evening MBA with Babson, (back then, winning Babson’s business plan contest was an excellent way of getting real funding and being able to actually make a real company, so we all worked mighty hard on pulling it off). In essence, it was a better version of Direct Hit, before Direct Hit launched, using user clicks as the prime mechanism to improve relevance sorts, but with the addition of a strong user profiling component, so that it only would use the clicks of folks “like you” to define your sort for a given query, and of those people like someone else when they issued the same query.

Knew the marketing side of the business would be much easier, (to Direct Hit’s absolute credit, to this day there is no company’s tagline that I love better than what theirs was - “One Site, Millions of Minds” - perfection - simple, totally got the concept across - wondrous! :) ) so spent 6 months figuring out the tech side, i.e.:

- How much could you know about someone the first time they came to you - what things would be the best to use and to what degree - IP resolution, (removing all entries from Vienna, VA, of course; all the AOL folks) associating the person with the user group for which his search term was most populous, etc., etc.

- How, and to what level, could you refine the user’s profile given his query and click patterns, frequencies, etc., other data that you might be able to infer from offline sources, based on the data you could pull, (most notably, via IP, allowing for the error that the IP is actually where your provider connects, not you, which can radically affect the usefulness of this variable).

- How would you know when the user’s behavior suggested a subclass of whatever class you had him currently a part of vs. when you should migrate him to another segment tree, etc., etc., (hey, I told you I was a geek at heart - the business side is how I try to make things actually come about! :) ).

Anyway, enough of the “Dylan’s Direct Hit before Direct Hit” story for now, (though I still find it interesting that I presented the concept in Wellesley, MA, and shortly thereafter a new company was founded in Wellesley, MA, but that’s something else…. I know, I know, and Kennedy was really killed by a hellish combination of Girl Scouts and escapees from Area 51… ;) ).

The second part of my interest (very short version) is that I was PM for Internet Search for Fast Search & Transfer from nigh unto the beginning in ‘99, (left in ‘01) which was bought out by Overture in ‘02, (I think) and thence by Yahoo, (4 mths thereafter) so if Yahoo is indeed working on bringing at least portions of Clever out of mothballs, and reunifying it with my Old Girl, that makes me happy on so many levels, (we actually did do a deal with IBM, and licensing some of Clever was discussed, but IBM decided they were going to figure out how to use by themselves, or nobody was). I truly miss the old discussions we used to have as to what defines relevance, to whom, what technologies / areas of R&D might improve, etc., etc. Awesome fun stuff to work on, and am working right now on figuring out how best to apply, (with no cash, of course - I have little-to-none, nor do I see a whole slew of VC’s dying to give me some! :) ).

And this time, when I want to do PFI or text P4P, (as I did in ‘00) or, much more importantly, the next thought on monetization, (since back then, I was in a good place to pull off - now, I’d have to be an idiot to go head-to-head vs. Google & Yahoo, but am sure there are plenty of holes around them) I won’t have to worry about speculation from others that doing so would isolate our B2B clients, (even after Google had done the same thing to Yahoo) even given that they had already pushed me from $4.00 per thousand queries down to $1.75 16 months later, (soon fully inverted to “I don’t pay you - you pay me $5.00 per thousand”).

$100M for the technology when Overture bought my Old Girl out, $1.5Bil when Yahoo bought Overture plus my technology 4 mths later, $23Bil+ Google IPO…. oh man, I could have been…. Stop… Not productive, except in once again reminding me that speculation belongs only as a way of educating tests in the actual open market, but it is the market, and not random speculation, that should determine what a company tries to do. And yes, I had Alltheweb.com, which we’d grown to 5.5M queries per day at that point, half of a Lycos, (when Lycos was actually impressive) so rather than costing me $1M a year in infrastructure costs to support, could have been…. Stop…. Again, would’ve, could’ve, should’ve - who cares - it’s done.

Ignore the still-sore spot, (obviously! :) ) read the Clever article. Hope that the guys can figure out how to use some of the better concepts from Clever such that it can respond in less than 11 mins, (i.e. beauty is certainly beauty, but it’s still better to actually make something a reality along a path and get better from there - if something only exists in a lab, it doesn’t exist) unify that with my Old Girl, (now also combined with AV & Inktomi) and bring something extraordinary about.

For me, gives me great hope - not just for Yahoo, (though, as you can tell, I still would love to see my Old Girl glow again - it’s been a bit, certainly now @ ATW.com, she’s barely even a shadow) but more importantly, in adding to the assertion that there indeed is still life in doing Search well. I have no cash, but I don’t care - at this moment, I am more pleased than I’ve been in a long time! :)

Now to figure out the hardest part of the solution that I’ve been trying to figure out for months, if not years - how the heck to work on, after work, while still putting the right amount of time into my wife and daughters, who are much more critical - if you find yourself lucky enough to be married to someone who was with you when you were (at least theoretically) worth a small fortune, and she stays with you when you’re once again worth nothing, without a moment of hesitation or recrimination, (other than the “don’t even talk to me about equity again!” ;) ) hold onto her for dear life - better than one in a million. And if you further are greeted every day when you come home, regardless of whatever happened, with smiles, loving hugs and excited squeals of “Daddy!!!” you’d be a flaming idiot, (and yes, this is preemptive for an elder me, just in case) to endanger that - for any reason - ever.