Amobee: Keeping Money With The Carrier

One of the big differences between the cell phone environment in the US versus Asia and Europe is the extent to which revenue and commerce have been controlled by the carriers versus other businesses. In the US, carriers have been more successful at retaining greater control over their customers’ purchases.

Now, talk to two people in the industry and you’ll likely find out that this is a good thing and a bad thing. Carrier lovers point to lower relative cell phone service costs in the US, while carrier haters will tell you that it stifles innovation.

Whatever you believe to be the truth in that debate, it’s clear that Amobee, a start-up based in the Valley, is an intriguing way for the carriers to capture a healthy chunk of ad revenues from their customer bases.

What Amobee offers is a telephone company quality ad serving and monetization platform that lets carriers offer a broad array of ad and sponsorship options to marketers. This can take a variety of forms, from standard CPM and CPC stuff to ways that marketers can cover or at least subsidize phone based services.

Let me give you an example: a travel web site could offer users free access to a cool new mapping functionality simply by asking users to interact with a branded experience. Another example: a company could give users free access to premium content, like a movie or TV show, in exchange for viewing/participating in a marketing experience.

The quality, security, and reliability of Amobee have to be high for them to create lasting relationships with carriers. Carriers are extremely protective of their users’ experiences because a good experience can drive loyalty while bad experiences will ratchet up churn. Advertisers that want to ensure a positive consumer experience may find that sort of reassurance a plus as they search for an ad platform.

A gillion studies have demonstrated the consumer appeal of such a model, and Amobee offers carriers a way to get in on the funds. Their rev share model enables carriers to benefit from marketing activity of their users while also giving them important access to user information that will help them better customize experiences in the future. Such knowledge will also be critical in helping to drive down churn, which is inarguably the biggest impediment to carrier sub and revenue growth today.

Thanks for reading, and don’t forget to write.

AdMob Gets Specific With iPhone Ad Opps

You all know I like the iPhone ad space, and I found an interesting set of demos for AdMob’s many offerings on their refreshed web site. I think lots of people are intrigued by this space, but find it difficult to understand all of the options available merely through text descriptions. That’s why I like their long list of iPhone ad example demos – in fact I like them so much I decided to republish them all here! Without further ado, here are some examples of what you can do with iPhones:

Connecting App Ads to the iPhone Store:

Promote your app and drive users to download it by directing users to Apple's App Store when they engage with your ad.



Map Ads

Users input their location to launch Google Maps. This functionality works particularly well to drive traffic to a retail location while users are on-the-go. Store locator functionality helps users find the closest retail location and get directions from their present location.



Video Referrals
By directing users to a YouTube video, you can maximize the video assets you've already created. This functionality allows you to build your brand and also has a viral component, as users can share videos they've watched with friends.



Refer to iTunes

Now users can purchase your music, games, or video files from iTunes. This functionality allows you to send users straight from your ad to the iTunes Store where they can preview and then buy your files. From promotion directly to purchase.



Click to Call

A mobile staple! With Action: Call, iPhone users can initiate a voice call immediately when they engage with your ad.



iPhone Optimized Sites

Many advertisers create mobile sites or branded landing pages where they can engage their users in multiple ways by offering downloads, galleries, videos, and more. Action: Web allows you to direct your users to your site for a rich brand interaction.



Audio File Ads

Drive users directly to audio files. Action: Audio opens a media player, allowing users to listen to your music, podcast, news, or other audio immediately.



Canvas

Create your own canvas that takes advantage of the new rich media possibilities of the new iPhone. Expanding to a screen-sized canvas with a signature animation, Action: Canvas allows you to engage users with any Action or combination of Actions you choose.



Pretty cool, hunh?

Thanks for reading, and don’t forget to write.

MTV Ad Network Takes a New Tack

Well, MTV, which already has a vertical network (natch) has reformatted that network into "tribes" built around their lead media properties. The idea is to get more revenue from exiting advertisers on their mainstay properties by selling those audiences across the web. It's a potent approach in that it will help grow their own revenue while giving sites access to advertisers that would frankly never ever ever get around to buying their ad space.

What I like about the approach is that it is demand rather than supply driven -- meaning that they can meet the needs of advertisers better through this approach. And in so doing, help suppliers. It's sort of a...dare I say it...marketing approach to selling marketing space. Is that an interesting innovation.

While the also ran networks struggle to get some traction -- any traction -- with certian advertisers, MTV can build on its existing relationships and snare a larger share of their total ad spend.

What are you saying, that this is just packaging...another name for channels? Why, YES, I agree with you. Packaging good.

Thanks for reading, and don;t forget to write.

On Sugar: Yay! Not A New Ad Network!

Yes, friends, a major web property has NOT launched an ad network! Perhaps owing to the fact that the number of ad networks has crossed the 400 mark, the Sugar blog network (PopSugar, BuzzSugar, etc. etc.) has instead decided to launch a free blogging platform called On Sugar. Tech Crunch broke the story.

The feature list is impressive, particularly if your subject matter is pop culture/fashion/style celebs. From their site:

Key Platform Features:

- 10 different post types: (text, gallery, spread, poll, quiz, quote, link, chat, video, & audio)
- Free access to a hundreds of thousands of Getty Images®
Fun drag and drop "spread maker". Create your look with thousands of fashion images from hundreds of online retailers through ShopStyle, e.g. ShopBop, J. Crew, Net-a-Porter, and others.
- Build your audience of followers with automatic notification of new posts
- Follow your favorite sites and view an aggregated feed of your followed sites
- Multiple sites per account
- Multiple authors per site
- Easy import from Blogger, Wordpress, & Typepad
- Full domain support
- Free


Key Site Features:

- Drafts/Timed Publishing
- Search
- Archives
- Pages (e.g. About Me, Galleries, Videos, etc)
- Widgets for highlighting content from your site or around the web (e.g. Popular Posts, Latest Comments, Latest Tweets, etc)
- Related posts from your site or, if you choose, from sites you follow
- Completely customizable themes


Technologies:

- Drupal - open source content management system
- Akamai - Entire platform uses the Akamai content delivery network
- memcached - Extensive use of memcached
- Smarty - Template engine
- sIFR - (Scalable Inman Flash Replacement) is a technology that allows you to replace text elements on screen with Flash equivalents.
- TinyMCE - Rich Text Editor
- LLMP - Linux, lighttpd, MySQL, PHP
- Fully documented API

The free platform, which enables the bloggers to join Glam or other female targeted ad networks, enables Sugar to monetize these sites through deployment of the ShopStyle Widget. ShopStyle links fashion, culture and celebrity to a buying engine that puts replicating looks and participating in trends at the user's fingertips.

Now, Sugar may yet intro an ad network, but at least for now they seem to be abstaining for a while. It makes sense at least until there is some shakeout in the network ecosystem.

Thanks for reading, and don't forget to write.

BAIN/IAB Digital Pricing Research - Sobering Facts For Online Publishers

Last month the IAB published a study it conducted with Bain Consulting on the pricing differentials between inventory purchased from publishers directly and inventory purchased on those sites through networks.

The figures show what most of us knew all along -- that the price paid for ads on publishers are much higher if you buy direct than if you buy via a network.

But the figures are pretty amazing. Check out these couple of slides:





The key figure if you wanna focus on one is that while publisher direct CPMs were in the $12-$18 range, the price realized by the publisher for network inventory ranges from 60 cents to $1.10, or only 6-11% of the direct CPM.

For many publishers, the amount of revenue being sold via networks has climbed dramatically as they are pressured to generate more revenue per page. But this vast differential points to a number of challenges for publishers -- how long will advertisers pay such an enormous premium for inventory as networks become more and more conscious of the need to ensure quality?

Now, of course there are a lot of reasons to buy direct -- for one you can develop a presence on pubs that truly offer the best audiences and credibility. There is a difference between buying Forbes.com and buying a business channel that might conceivably include...this blog, were I offering advertising on my pages.

How do publishers respond to this differential? Well, I think there are a number of ways:

1. Ensure pub direct inventory is better -- better locations, above the fold, maybe technologically better.

2. Ensure that they can sell a reasonable amount of any incremental inventory before they create it. Adding a new banner position to a page is only so valuable if it will end up being 99% sold by networks.

3. Work with networks to help them increase the value they are getting and sharing for your pages.

4. Work with networks that will get you more revenue per placement. There really are differences and networks that offer higher quality standards, for example, are more likely to genrate more revenue.

5. Explore vertical networks as a means of driving higher CPMs. Many times verticals can get more for topical inventory.

One organization that I think can offer great lessons to publishers is the AMA. Doctors are in limited supply and thus their fees can be higher. In a sense, demand exceeds supply. Compare that to teachers, especially in state with low certification requirements, where hurdles for accreditation are low and thus wages are lower.

The IAB has a set of their own recommendations that you should check out. But this is a really groundbreaking set of info -- a wake up call for our industry that you should peruse.

Thanks for reading, and don't forget to write.

Ad Network Reach - Growing By Leaps and Bounds

Well 2007 and 2008 were certainly the years of ad networks. But some erroneously believe that the growth in networks is in number rather than size. Not so. Yes there are 300+ networks out there now, but the leading networks have also continued to grow their reach, as this chart of Comscore data clearly shows:



Bigger generally does mean better in the network biz, at least on the "horizontal" side. Verticals play by slightly different rules, though in their case as well, size generally provides enormous business advantages.

Thanks for reading, and don't forget to write.

When You Know A Lotame, You Can Target Better

Social media has been, as well all know, a bear to monetize. Because of the nature of UGC, advertisers have been somewhat reticent to come into these pages, and then rather unwilling to pay much for the ads if they do.



Fixing that is what Lotame is about. Founded in 2006, Lotame is focused on monetizing social media by collecting information about page users and then using that data to help advertisers find the right eyeballs.

So it's behavioral, contextual, and demographic all at once in a way, and those concepts are probably old hat to you. But the key challenge with social is that a lot of it is long tail, and monetizing that stuff really isn't the strength of the BT and ad network majors.

Enter Lotame, a startup in Maryland that just got $13MM in its second round. As I understand it, Lotame is collecting anonymous info from page visits, online profiles, and other interactions for the purposes of identifying PRECISELY targeted consumer segments that help advertisers reach the most productive eyes, and publishers make mroe from their traffic, ad views, and users.

They describe themselves in this manner:

Lotame Solutions, Inc., founded in 2006 in Elkridge, Maryland, is a company dedicated to providing solutions within social media. Our Crowd Control Technology™ offers social media sites the most advanced monetization techniques and allows brands to build and target customizable consumer audiences. We aim to increase revenue for our publishers and allow advertisers to target unique users across multiple social media sites. The company has now grown to include offices in major metropolitan areas.

Here's Andrew Monfried, Founder and CEO, interviewed on WallStrip:



I am just guessing here, but the filtration of available data from social media pages must be an enormous challenge. How do you skim out the PII, as well as all the holla holla talk, to identify the bits that are going to determine who can be expected to respond to a marketer message.

There's is an extremely data driven business -- not surprisingly a number of their employees are vets of the ad network biz, where managing and "usefulizing" enormous quantities of page visitation and other data are core to the revenue streams.

Regular readers of this blog know that I believe deeply in the value of data assuming it is actionable data. As a market research vet, I know a lot of the info out there is perhaps nice to know, or interesting to know, but not need to know. This is even more of an issue today than it was, say 5 years ago, because there is so much mroe data available. Most of it not actionable in your quest to improve the bottom line. One visit to Lotame's site shows that hey are very much focused on the data points that will drive results.

Check out their site. There's lots of video and a really interesting action-oriented take on how to make social media visits and page views actionable and lucrative.

Thanks for reading, and don't forget to write.

ISP Targeting: In the EU The Gun Sights Are On Phorm

I'm not suggesting for a moment that the heat is off NebuAd, but in the EU at least the company in the sights of regulators is Phorm. You may recall that Phorm had a positively disastrous time in the UK last Summer when they quietly launched their version of an ISP based ad network with BT (nee British Telecom), Virgin Mobile, and TalkTalk. Well, quietly is not the right word. Secretly is actually the correct term. Or perhaps covertly.

Phorm is the new name developed by a spyware operation called 121Media, which used offers of free secondary utility applications to convince people to download their adware/spyware products. Tomato/tomahto. As with Gator, the early days of this business in particular were loaded with examples of people not understanding that they were allowing 121Media to track their behaviors and field targeted ads. 121Media claimed it was those pesky partners that distributed their software that were to blame for these atrocities. Several millions of Americans including myself will find the story rather familiar -- we downloaded apps that gave Gator permission to field ads to us based upon serving habits. Then, when we realized what we had done, we found Gator all but unremovable.

OK, so Phorm. They changed the name of the company and shifted their focus from getting people to download their offering to getting ISPs to sell them the non PII portion of the info that made ad targeting possible.

Only trouble is, they didn't tell the people that were being tracked in the test. Some 18,000 of them. I don't mean they buried the revelation. They didn't tell them AT ALL, even in an intentionally quiet way.

How was this all discovered? Well, by a reader of TheRegister.co.uk, as outlined in this post. Here's an excerpt:

In June 2007, Reg reader Stephen noticed his Firefox 2.0.0.4 installations making suspicious unauthorised connections to the domain dns.sysip.net every time he visted any website. Naturally worried his machines had contracted some kind of digital infection, Stephen performed a series of exhaustive malware scans, which all came back clean.

He wasn't the only BT subscriber to notice that his browser was making the mysterious contacts around July last year, as this thread archived at Thinkbroadband.com shows.

"I spent all weekend wiping my disks clean and reinstalling from backups (four PCs seemed to be affected). I spent a further two days researching and installing all kinds of anti-virus, anti-spyware and anti-rootkit utilities. But even after all that I still have this problem!" Stephen told us at the time.

Having failed to trace the source of the dodgy redirect in his own network, he contacted BT to suggest one of their DNS servers may have been hijacked. BT dismissed the idea, yet the browser requests were still making an unauthorised stop off at dns.sysip.net.

Worried that his business' financial data might be being monitored, Stephen continued to investigate. A Whois search for dns.sysip.net revealed the domain was registered by Ahmet Can, an employee of a new online advertising company called 121Media. The address is now registered through a third party private domaining agency. 121Media rebranded itself as - you guessed it - Phorm in May 2007.

This is, you'll be unsurprised to learn, indeed the same Phorm that BT, Virgin Media and Carphone Warehouse recently revealed they had agreed to sell their customer's browsing habits to, despite the questions over its links to spyware. For helping Phorm target advertising, the ISPs are set to bag a cut of click revenues.

So, throughout the test period Phorm and BT had a novel consumer communications system.

DENY DENY DENY!

BT actually called the hijack process by which the system worked a clear incidence of malware.

But then! On 2/14/2008, BT and two other companies announced they had a deal, and that the hijack process was

validated under best industry practices, both through an independent audit conducted by Ernst & Young (View report PDF) and a Privacy Impact Assessment undertaken by Simon Davies, MD of 80/20 Thinking and Director of Privacy International.

Malware...revolutionis[ing] current standards of online privacy and fully protect[ing] the identity of consumers. Tomato...tomahto.

Phorm was paired with an application called Web Wise which was supposed to make people feel OK about the tracking. It was and is a phishing detector.

The British government essentially decided not to deeply pursue whether laws had been broken in the BT test. They issued their opinion that things were okiedokie, but many European web experts disagreed, as outlined in this post on TheRegister.co.uk.

(Has the US started exporting Bush Administration officials? ;-) We've have loads more folks like this, UK, if you want them. 2 for 1 sale through November.)

Here's a morsel:

"The explicit consent of a properly-informed user is necessary but not sufficient to make interception lawful.

"The consent of those who host the web pages visited by a user is also required, since they communicate their pages to the user, as is the consent of those who send email to the user, since those who host web-based email services have no authority to consent to interception on their users' behalf."

And the EU earlier this summer insisted they do so. Here is the text of the letter that was sent to the Brits by Brussels:

Dear Sir,

I am writing to you in relation to certain issues arising from the past and future deployment by some major United Kingdom Internet Service providers of the technology provided by a company called 'Phorm' to serve their customers with targeted advertisements based on prior analysis of these customers' internet usage.

In March 2008, a number of news items appeared in the media concerning the planned use by United Kingdom ISPs of the Phorm technology. Many of these publications raised issues concerning the impact of this technology on the privacy of Internet users. The information published on the web also included an e-petition submitted to the Prime Minister and a complaint made to the Information Commissioner's Office (ICO). In addition, in early April 2008, BT published a briefing according to which it had performed trials of the Phorm technology in autumn 2006 and summer 2007. In a TV interview, a BT representative confirmed that these trials had been performed without informing the customers affected and obtaining their consent.

The European Commission has already been contacted by Members of the European Parliament from the United Kingdom who communicated the concerns of their constituents regarding the deployment of Phorm technology. The issue has also been the subject of several written parliamentary questions addressed to the Commission by MEPs asking the Commission to comment on the applicability of WU legislation and also to set out its intended action in relation to the previous trials. Finally, a number of individuals have also written to the Commission directly to express their concerns and invite it to intervene in the matter.

In order to provide the response that is expected from it, the Commission needs to base itself on a clear understanding of the position of the United Kingdom authorities. Several EU law provisions concerning privacy and electronic communications may be applicable to other activities involved in the deploment of Phorm technology by ISPs.

In particular, Directive 2002/58/EC on privacy and electronic communications, which particularises and complements for the electronic communications sector the general personal data protection principles defined in the directive 94/45/EC (Data Protection Directive), obliges Member States to ensure the confidentiality of communications and related traffic through national legislation. They are required to prohibit listening, tapping, storage or other kinds of interception or surveillance of communications and the related traffic data by persons other than the users without their consent (Article 5(1)). The consent must be freely given, specific and an informed indication of the user's wishes (Article 2(h) of Directive 95/46/EC). Traffic data may only be processed for certain defined purposes and for a limited period. The subscriber must be informed about the processing of traffic data and, depending on the purpose of processing, prior consent of the subscriber or user must be obtained (Article 6 of Directive 2002/58/EC).

In the light of the above, we would highly appreciate it if the United Kingdom authorities could provide us with information on (1) the current handling by the United Kingdom authorities of the issues arising from the past trials of the Phorm technology by BT and on (2) the position of the United Kingdom authorities regarding the planned deployment of the Phorm technology by ISPs.

As regards the first issue, according to applicable EU law the responsibility for investigating complaints concerning such trials and determining whether the national legal provisions implementing the requirements of the relevant EU legislation have been complied with lies with the competent national authority(-ies) in the United Kingdom. The Information Commissioner's Office (ICO), which is responsible for enforcing the United Kingdom Data Protection Act 1998 (DPA) and Privacy and Electronic Communications Regulations 2003 (PECR), has made a number of statements on Phorm. In its latest published statement of 18 April 2008, the ICO analyses the conformity of the deployment of the Phorm technology with the DPA and the PECR. At the same time, the ICO indicates that it does not have responsibility for enforcing the Regulation of Investigatory Powers Act 2000 (RIPA), which has been invoked by some individuals who question whether the use of Phorm entails an unlawful interception of communications under this Regulation. In this respect, the ICO refers to a statement by the Home Office, which says that it is questionable whether the use of Phorm's technology involves an interception within the meaning of RIPA and that it does not consider that RIPA was intended to cover such situations. The ICO concludes on the issue of RIPA by stating that it will not be pursuing this matter. At the same time, the ICO statement does not include any indication as regards the intentions of the ICO in relation to the investigation of possible breaches of other relevant legal provisions* in the past trials of the Phorm technology.

Second, as regards the issues arising with regard to the planned future deployment of the Phorm technology, there appears to be a certain discrepancy between how it is envisaged by the ICO, the ISPs and Phorm itself. One of the most significant issues in this regard is the way in which customers will express their consent to the application of Phorm technology in their case. While the ICO seems to suggest that the consent of users for the Phorm technology should be on an opt-in basis and also BT seems to confirm this approach, Phorm has indicated that it intends to tackle user consent through providing 'transparent meaningful user notice'.

I would therefore be grateful to receive the response of the United Kingdom authorities on the following questions:

1. What are the United Kingdom laws and other legal acts which govern activities falling within the scope of Articles 5(1) and 6 of Directive 2002/58/EC on privacy and electronic communications and Articles 6, 7 and 17(1) of Directive 95/46/EC?

2. Which United Kingdom authority(-ies) is (are) competent (i) to investigate whether there have been any breaches of the national law transposing each of the above-mentioned provisions of Community law arising from the past trials of Phorm technology carried out by BT and (ii) to impose any penalties for infringement of those provisions where appropriate?

3. Have there been any investigations about the past trials of Phorm technology by BT and what were their results and the conclusions of the competent authority(-ies)? Are there ongoing investigations about possible similar activities by other ISPs?

4. What remedies, liability and sanctions are provided for by United Kingdom law in accordance with Article 15(2) of the Directive on privacy and electronic communications, which may be sought by users affected by the past trials of the Phorm technology and may be imposed by the competent United Kingdom authority(-ies) including the courts?

5. According to the information available to the United Kingdom authorities, what exactly will be the methodology followed by the ISPs in order to obtain their customers' consent for the deployment of Phorm technology in accordance with the relevant legal requirements and what is the United Kingdom authorities' assessment of this methodology?

Given the urgency of this matter I would highly appreciate receiving your reply within one month of receipt of this letter.

Yours sincerely,

Fabio Colasanti

The EU has far stricter definitions of online privacy protections.

The Brits demured from responding, so the EU has since issued a "prewarning" followup letter.

This is beginning to become a rather significant embarassment for the UK government, BT, and Phorm. More as it develops.

If you are looking for more on Phorm, make sure you head over to TheaRegister.co.uk. They are clearly at the forefront of this investigation and issue. After all, they broke the story and typically break every significant development on the topic.

Thanks for reading, and don't forget to write.

Travel Ad Network: Coffee, Tea, or Profit?

I am really excited that C:SF is doing a new project with Travel Ad Network, because I like the company and its model so much.

Regular readers know that I am a big fan of vertical ad networks -- the media sellers that aggregate inventory in a key sector and add value through technology and industry knowledge.

You may NOT know, though, that I think travel will be a leading web growth sector over the next five years. And I think this because:

1. Digital works for travel, from both a DR and a brand building perspective.

2. It is becoming increasingly difficult for brands to differentiate purely through experiences. This is CERTAINLY true in airlines, where financial realities are driving the nickel and diming that aggravates us yet which we understand as inevitable. But I think commoditization has become a potential issue across the board -- as more and more of those multiple hundred million dollar resorts go up. While in Hawaii recently, I heard an 8 year old say "So they have a dolphin in the tank. Big deal. I've seen that before." What can a hotel do to impress that little pint sized cynic? And since i am on a rant, the Wynn Hotel in Vegas cost $1B. What next? $5B?

3. Online is increasingly the resource of choice for consumer info on destinations. We want our specific needs and interests catered to, and online is really the only resource that can provide a high level of information customization.

4. Tough economic times will drive travel companies to focus increasingly on media that drive concrete and accountable metrics.

Big growth is gonna happen, people! Betcha $10!



But as this growth materializes, travel is increasingly finding itself in the same position as the auto category -- where more and more dollars are chasing what appears to be a finite amount of inventory.

Ad networks can really help in such a situation, and one that I think is poised to grow well in travel has the rather easy to remember name of "Travel Ad Network." The way ad networks help in such a situation is to grow the amount of available inventory by aggregating sites beyond the top ten along with vertical content on general interest sites. This brings lots of new high quality inventory to the marketplace, while simultaneously simplifying the processes of buying, trafficking, reporting, and optimization.

I like TAN because it aggregates high quality inventory from across more than 50 travel sites -- many of which attract highly involved and passionate audiences. These are the sort of people that will be increasingly critical to an industry that may face downward margin pressure; passionate people can be expected to pay more because they care more.

One key differentiator in any network - vertical or horizontal -- is the percentage of inventory that is remnant versus from exclusive representation agreements. There's nothing wrong with remnant, but when you see a vertical that doesn't entirely rely on it, you can surmise that they offer some unique strengths worth examining. TAN has built its business on exclusive representation agreements, and works with high quality sites like Rand McNally and Lonely Planet.

Because many of the sites they represent are large, TAN currently offers the third largest monthly reach in the travel vertical:



This theory is further borne out by the demos of the network, which offer a disproportionate number of people in that highly desirable $100K plus group.

While most networks focus mostly on the standard four creative units -- the four core IAB sizes, TAN has chosen to create a much broader range of marketing vehicles that add to the number of potential consumer touchpoints and offer what may well be a more compelling creative palette.

Hear are just some of their options:

Destination or content on page
Behavioral targeting
Re-targeting
Location or IP address targeting
Day/Day part or time of day scheduling
Frequency of visitation targeting
Customized placements
Targeted text links
Destination spotlights (advertorial)
Email/CRM
Custom post-campaign ad effectiveness studies

Of course, one of the key ways that ad networks add value to publishers and advertisers alike is through technology, especially in the areas of targeting and analytics. TAN offers a full range of targeting options and people report that their reporting systems are quite strong.

News of TAN is definitely out -- after all, they've been around since '03. But I feel as though they are sort of a sleeper of the industry -- attracting strong clients already...



...but poised for big growth as news of their strengths gets out. As travel experiences great growth, expect TAN to grow even faster.

That's why I am so excited that our team will be working with them. Hey, you can take this post with the proverbial grain, but I genuinely do think TAN is worth your attention if you are interested in the travel vertical and a high quality audience.

Thanks for reading, and don't forget to write.

iPhone App Ad Networks: Post 5 PurpleTalk

A very different, developer centric model is PurpleTalk, which offers an ad exchange model. Basically, when apps are launched, splash screens feature a banner ad for another app, encouraging cross trial. Here's how they explain it:

The AdShare program developed by PurpleTalk is the most cost effective way to promote your iPhone Apps. PurpleTalk partners that participate in AdShare will include a small PurpleTalk module into the applications they’ve developed. Then, each time a user launches an application that has this PurpleTalk module, a brief splash screen appears that promotes a different application on an embedded banner. Through these splash screen promotions, users will become aware of many different applications, including yours.

There's very little other info on their site in terms of revenue model. Models like this are fairly common in the blogger world, where apps promote one blog on another, with a ratio of 9 exposures on other blogs for every ten on yours. That enables the company to sell exposures on the remaining inventory. I tried one, and got lots of exposures, though relatively few clicks. But that experience may well be very different because of the more focused viewing area on an iPhone and the fact that the ads appear on a splash screen versus in what (on my blog at least) is a rather busy sidebar. With this model you are certainly reaching an audience predisposed to downlaoding apps. I mean, they already did by definition!

I don't know if that is their model. Their pages explain that developer do not earn money for the ads but rather points that entitle them to ad exposures on other apps.

Thanks for reading, and don't forget to write.

iPhone App Ad Networks: Post 4 Medialets

A key part of the differentiating message of Medialets is that they develop creative experiences that enhance consumer experience rather than offering up ad formats people tolerate to get their free app.
This is what ReadWriteWeb had to say about this aspect of their business:

Medialets is being careful to make sure that their advertisements don't mar the otherwise unique and innovative user experience of the iPhone. While developers don't necessarily need to have their apps approved to work with Meidalets, the company will help them design ads that remain unique and beautiful, too. Medialets provides a supportive developer community and will offer demos and code examples for the developers to use.

What makes this level of creativity and customization possible is their team, which they report has members who have been working with the iPhone OS since its beginnings at NeXT twenty years ago.



That's a long time, indeed.

My inference here is that this custom approach is aimed at the inevitable convergence between content and brands. That this offering can cover much deeper consumer experiences and interactions than just text ads or banners. The benefit of this approach is that they can focus sales efforts on innovator advertisers, who likely have a greater predispostion to try things now. The drawback might be that some advertisers will find the custom idea too much work. This is the classic push me pull you of digital marketing right now -- I want deep, broad reach, and easy.

Fortunately, they are offering a development team that can make the process of developing such apps easy for the agency. That's absolutely essential with this model.

With the deeper kinds of interactions they offer, it's important to have a solid reporting and analytics platform, and their site outlines this in some detail. That'll make agency learning curves shorter, and potentially provide the sort of case studies that can get them real publicity and sales traction.

Deep experience may also broaden the appeal of this ad channel from primarily
geographically sensitive advertisers to more national and global brands with bigger budgets and comprehensive brand goals.

Anyway. What is clear is that Medialets is quite different from other offerings, and that difference may well be relevant for you.

Thanks for reading, and don't forget to write.

iPhone App Ad Networks: Post 3 Pinch Media

Offering a broader range of ad units than AppLoop, Pinch Media uses the JumpTap mobile ad platform to field ads

Their search offering uses an auction based ad system just like Google AdWords, so the highest bid gets the placement. One advantage over Google's operation, though, is that geotargeting is based upon actual versus surmised location. Their text ads are sold CPC, which is really the most sensible way to do so because that is what the market wants and expects.

The graphic ads use standard mobile banner and interstitial sizes, which makes sense given that advertisers do NOT need another creative loop to jump through. because their offering is iPhone specific, the creative specs will offer a bit more creative freedom than mobile campaigns developed for the lowest common denominator phone. Graphical ads are sold CPM, which lets them charge more for more immersive or intrusive experiences.

These guys have resources from a variety of sources:

Pinch Media’s seed funding comes from Union Square Ventures, First Round Capital, and several strategic angels - Dave Morgan, Jerry Neumann, Mike Yavonditte, and Sharkey Goldstein Capital.

The reporting isn't outlined on their site, but presumably it offers the expected metrics -- after all it's on the Jumptap platform.

Obviously a more robust solution than AppLoop, Pinch Media clearly has the money and platform to make a serious run for this market. They feature dozens of apps on their site, so their developer acceptance must be pretty strong thus far.

Thanks for reading, and don't forget to write.

iPhone App Ad Networks: Post 2 AppLoop

So, I have a big soft spot for the "two guys in a garage" sort of start-ups -- companies led by people with vision, commitment, and a belief in themselves and what they are doing.

BTW, the garage part is optional in my idyllic daydreams, and I have no illusion that in AppLoop's case there are two Eames chairs and drafting tables sitting next to a 74 Pontiac FireBird (with decal.) But founders Eric Kerr and Jacob Eiting are going it alone, and seem to be rightly proud of that. They are, in their own words not looking for venture.

They also both look smart, which of course is neither here nor there, but there ya go. Importantly, they have much better haircuts than Jobs and Wozniak had when they got their start. So years from now when they are millionaires there won't be any embarrassing pics to make them cringe. These two guys clearly have got it together. I am quite impressed by their offering and the way they present it and themselves on their site. Based upon their profiles, they are also very likable.

See their demo here:


AppLoop Demo from AppLoop on Vimeo.

Their focus appears to be geography, as in targeting ads by location, which also supports a DIY advertising model that can be appealing to local as well as distributed national businesses. As their site explains,

AppLoop connects your business with early-adopting, wealthy, and active consumers while they're on the go and looking to spend money. iPhone users are market mavens - will they drive their peers to your brand?

There's is a self service model for developers, and the documentation is so simple and easy to understand even I could understand it.

For developers they offer an analytics package outlining:

Installs
New Installs
Engagement (Usage)
Georgraphy (Nation, State, City)
Revenue Earned

For advertisers, they offer an easy to use DIY model that lets you track individual ads and set targeting geographies quickly and easily. Their's is a CPC model a la Google AdWords. that at least takes the risk out of advertising in this nascent media area.

Naturally, two guys running a business are focusing on DIY, and have wisely built their business around geography and local advertising, where DIY text ads have been demonstrated to be both popular with advertisers and acceptable to consumers.

The ad biz is a tough one, and it remains to be seen whether a bootstrap business like this can win the game. But perhaps winning in their case will be in selling their system to another ad network relatively quickly - having a small advertiser DIY solution could be of significant benefit for many ad networks struggling to achieve their own forms of critical mass.

I genuinely wish them all the best. They are EXACTLY the sort of people that move digital forward faster.

Thanks for reading, and don't forget to write.

iPhone App Ad Networks: Post 1

Well, that was fast, it's been like, days since the iPhone App store goes big, and there's already talk about having an ad network sell ads on free and paid apps.

Well, there ISN'T an iPhone app ad network now. No, there are at least four. And in the next few posts I am going to tell you what I know about them and how (if) they are different from one another. And that doesn't include the add-ons in existence from mobile and widget networks.

You know, the NYT says there are at least 200 ad networks currently in operation, and the key growth sector in terms of both launches and in revenue growth (if perhaps not in total revenue) are vertical ad networks - offerings that focus on a key demo, target, or platform. Well, here are super verticals -- no, no, let's coin a term, hyper verticals -- a specialty area within a platform.

We have to ask ourselves why does a new ad network exist before we draw a conclusion about whether it (in this case they) should.

For any vertical, I ask the following questions:

1. Is there a way for a vertical to provide unique value to publishers and or advertisers that couldn't be provided by a more general network?
2. Is there a market in terms of advertisers ready to advertise? Trailblazing ad dollar categories is a tough way to generate a return in 2008.
3. Is the ad product itself advertiser valuable?
4. Is there specialty IP that the network can bring to the party to help advertisers and publishers better reach their targets and persuade them?
5. Do they have the bucks to fight the hard scrap to establish themselves enough to get bought or be viable businesses on their own?
6. Do they have the tech necessary to deliver a decent viewing experience?
7. Will Apple allow this? There is a more general way to ask this, but I thought I'd be clear.
8. Will consumers accept the model?

The answer, BTW, doesn't need to be yes to all. But most would be a good thing.

I started this analysis a little dubious. I mean, mobile advertising has been a toughish slog for the existing ad networks in the space. But one always needs to remember that mobile is definitely a category in which there are cathartic consumer moments -- those American Idol events that get people adopting new data services technologies that are important growth engines for the category and, by inference, the ad biz generatable in it.

Well, let's talk about mobile for a minute. The very generous people at Nielsen Mobile have made a white paper available entitled Critical Mass: The Worldwide State of the Mobile Web. In it are loads of tasty data treats, of which some of the topliniest ones are summarized in a press release Nielsen issued in support of the paper:

The US mobile Internet market, with 40 million active users, has reached a critical mass for mobile Internet marketing

The Motorola RAZR phones are the most popular phones among US mobile Internet users, while Nokia handsets lead the market in Europe and Asia

Unlimited data packages are increasingly popular with mobile Internet users. Today 14 percent of US subscribers access the mobile Internet with an unlimited data package, and 50 percent of data users say that they prefer the unlimited pricing model.

3G networks drive user satisfaction with mobile Internet, and these networks improve data throughput speeds as much as six times, compared with 2 and 2.5G networks

Advertising is becoming a common part of the mobile Internet experience. Today 26 percent of mobile Internet users view ads while using the mobile Internet.

Mobile Internet users are more receptive to mobile advertising than average data users

By all accounts, iPhone users are more likely to use the web than other phone users. This comes, I think from two key factors:

1. iPhone attracts exactly the sort of gadget geek that likes to experiment and is more likely to use her phone for more than just tawking.
2. iPhone is just so darned easy to access the mobile web with.

Lots of estimates are flying about on how many iPhone will be in use by year end. I like the number 20 million. It's aggressive but I think eminently achievable given the new price point and the coolness of the device itself, coupled with the dearth of equivalent devices (at least in terms of user experience.)

20 million is nothing to sneeze at, and given that the AppStore at Apple is already downloading bajillions of apps, there is ample evidence in strong consumer interest.

So here are what I think are the answers to my eight questions:

1. No.
2. Maybe. The ad biz is very trend driven, and I can see advertisers wanting to be active in mobile finding this model -- captive audience, graphic ad, good audience demos, reasonable entry price -- a great way to get started.
3. Yes. Graphical, attractive, captive audience.
4. Maybe. By providing deep insights into these users, these networks may offer a way to reach that elusive innovator/early adopter that is so critical to many advertisers. But interest is going to be very category specific I think - electronics, entertainment, perhaps auto, retail for GPSy apps. The challenge will be how to make it worth an advertisers while to deal with them for some mobile ad spend and to a more general mobile network for other mobile efforts they may want.
5. Dunno. Some may.
6. I think one can. Perhaps two, Not four. And not ten.
7. Not sure, but I think they're gonna want a cut before long.
8. I think yes as long as we don't get all ridiculous about how the ad works and how long they last. Consumers have been shown in a variety of research studies to be willing to trade ads for free access to mobile utilities and applications.

In the next few posts I'll be looking at several of these companies as well as exploring how the mobile ad networks already out there are addressing this opp.

Thanks for reading, and don't forget to write.

New Way to Count Ad Network Reach from Comscore

Beginning in August, Comscore is going to be issuing two numbers for the potential audience reach of ad networks -- a POTENTIAL reach number, which adds up the reach of all the sites they offer, and an ACTUAL reach, which reflects the reach of ads actually served by the network.

YuMe has already felt the pinch of this decision -- in earlier Comscore reports, YuMe was being credited with "extra reach" (extra in competitors' view, not in YuMe's) from MSN that reflected not the actual reach of the ads but the potential reach of the network.

I'm not sure how I feel about this one (and I should point out that we are working with YuMe competitor BrightRoll right now producing a roadshow so take my opinion with that proverbial grain) -- the reach number networks offer is generally to demonstrate to advertisers what they could get. The actual perhaps offers a surrogate for the network's business level. I can see both sides of this argument, and it's important that when people look at these counts they understand the difference. There is a big potential for planners to mistakenly mix apples with oranges here.

I think this is going to be more of an issue in video where there is less demand for the sort of sub $1 CPM junk that can help a banner network live up to its potential reach. There's always a University of fill in the blank to buy banner junk. That just isn't really done in video. Yet.

In any case, the two numbers show different things and I hope the world understands that ongoing.

Check out this MediaPost article for more info.

Thanks for reading, and don't forget to write.

If You Don't Like the News, Lay Off the PR Folks

NebuAd has let go both its internal PR team and its PR firm. Their PR firm, The Horn Group, confirmed the parting of ways according to this piece on The Register.

One understands why the layoff occurred, though in the defense of the team, NebuAd is certainly in new waters where there is little precedent as to how to shape public opinion. Dustups about BT were pretty minor in the past, and there are plenty of companies collecting PII, which would seem on some level more serious than what NebuAd does.

What's interesting about the layoff is the accompanying info that they are going to hire a new PR team focused less on business press and more on regulatory issues. What THAT says is they expect a tough row of hoeing over the fate of their ISP based out opt model.

I'll say this for NebuAd's now separated PR people: these folks know how to spread the word. This is not left handed praise. Before Robb Topolski's report, NebuAd was travelling with full sails of largely excellent press coverage. Their CEO was EVERYWHERE touting the power of their model.

You can fault them for not having a better plan for the regulatory and PR problems that befell the company beginning a month or two ago, but for pure corporate hype and PR these people knew their stuff.

Perhaps you will find that an odd point to make -- what I think it means is that PR< like virtually every other area of marketing these days, is increasingly becoming a field for the versatile. While the web seemingly ushered in an era of experts, the opposite seems to have occurred. Companies are moving away from the dedicated digital team toward a model where EVERYONE is expected to know about digital, because it is the central core of current and future marketing.

In the PR vane, operating a powerful PR organization will be about more than a hype team -- it'll be having a sound strategic approach to both the hype development mandate and the contingencies for potential public or industry backlash.

Here's a piece of what MediaPost's Wendy Davis wrote on the topic of the layoffs and the future of NebuAd:

It's not surprising that NebuAd would be feeling an economic squeeze, given that several broadband providers have suspended plans to work with the company while Congress investigates. Lawmakers are now questioning whether companies like NebuAd and Phorm, which purchase data about users' Web-surfing activity to send them targeted ads, violate federal wiretap laws. Rep. Ed Markey, for one, has said he believes ISP-based behavioral targeting requires users' opt-in consent.

Still, the layoffs, combined with the new PR strategy, make clear that NebuAd didn't anticipate the degree of pushback it's now facing, both from policymakers and privacy advocates. Of course, until this summer, NebuAd didn't have much reason to think Washington would take an interest in its activities.

For the most part, online behavioral targeting seemed to fly under lawmakers' radar earlier this decade, when companies like Tacoda and Revenue Science were getting started. That situation had started to change by 2006, when the Center for Digital Democracy and U.S. Public Interest Research Group filed an FTC complaint about behavioral targeting techniques. The FTC held a town hall meeting last November, but few people were yet discussing NebuAd and other companies that rely on data purchased from ISPs.

But when news that NebuAd was testing its ISP-based targeting model trickled out earlier this year, it was clear that behavioral targeting was entering new territory. Older companies only know when users visit a site within one of their networks, but ISPs know about all sites that are visited and all search queries entered.

SO what IS the future of NebuAd??? Naturally as an outsider I have no idea, but here are my guesses:

1. A name change. Whether deserved or not, they may as well be called KGB Industries at this point.

2. A freeze on making efforts to sign up for ISPs AT LEAST through the end of the year. My understanding is that they have already begun this free period. I think this would make sense not because it'll actually make a difference in sign-ups from ISPs -- my guess is that the doorbell isn't ringing right now -- not when BNET is reporting that the feds are investigating the company under wiretapping laws. But rather as a signal throughout the organization that they need to make their model right.

3. Some sort of consumer communication solution that will make opt-out a more palatable solution. I don't think they will go opt-in -- I don't think opt-in is a realistic approach for an ad network. There's no consumer value to all this beyond the dubious possibility that it lowers ISP costs.

Will this stuff come to pass? I have no idea. But I do know that those layoffs were probably necessary given the burn rate. Even after the layoffs, 60 people is a big pile of salary and bennies.

Thanks for reading, and don't forget to write.

Sportgenic's Robert Tas - Article on iMediaConnection

Great post from Robert Tas on iMediaConnection on selecting an ad network. Check it out.

Thanks for reading, and don't forget to write.

White Paper Thursdays: HOW TO CHOOSE AN AD NETWORK

Another plug for Robert Tas's ad network paper. Download it here.

Ad Network Glossary

A nice, succinct glossary of BT terms is available here at AdNetworkX.com

Thanks for reading, and don't forget to write.

FUNDAMENTALS OF AD NETWORKS: POST 4

DOES THE WORLD NEED ANOTHER AD NETWORK?

Hmm. For the first few months of this year, there was rarely a week when AT LEAST one new ad network wasn’t launched. Some of the forces that have driven this growth include:

• Relatively low learning curve and infrastructure requirements
• Potential for high profitability (if successful.)
• Investor frenzy to invest in networks, and the payment of extremely high multiples for such networks as Glam.

There are many that feel that too many ad networks have been launched without a great deal of unique competitive strengths or critical mass.

Given the glut of networks out there, those who are contemplating starting a new network should consider some or all of the following questions:

Proof of Concept

• Is the offering of the proposed network unique? The world does not want or need another me-too horizontal or vertical network. It may want and need one with a clearly defined and differentiated purpose.
• Is there high quality, desirable content to be aggregated? In some market segments, there really isn’t much high quality inventory left to represent.
• Can you expect consistent advertiser demand? If a particular category is simply “hot” but not one for which consistent, sustained demand has been proved, you need to consider the odds of market stability. As an example, a number of widget ad networks have sprung up, among many others. While at the height of the widget craze it may have seemed possible to have half a dozen or more successful networks in this space, as this market cools to a simmer it is likely that only the strongest will survive.
Logistical Issues

• Can you build a quality team for your new network? It is brutally difficult to attract and retain sales, marketing and other staff in the current environment. Anecdotal evidence suggests that it is easier for vertical networks to attract teams because potential employees may be very passionate about the vertical. For example, one would expect an ad network like Sportgenic, which is geared to sport enthusiasts, to have an easier time attracting employees than, say, the 37th general audience ad network.
• Do you have pre-existing relationships with publishers and advertisers within the market segment you are targeting? Without them, it may be difficult to get on the radar of buyers or publishers.
• Can you achieve critical mass?

Financial Issues

• Do you have the capital necessary to get started? It would be highly inappropriate to expect profitability immediately in a market with so many players. You will need resources to sustain you as you build.

Other Issues

• In an environment of hundreds of networks, does your team have the passion necessary to succeed? This will be critical because providing unsurpassed customer service is essential in a market as competitive as this.
• Can you bring thought leadership to the market that you are serving? Along with price, quality, and reach, publishers and advertisers consider factors like the extent to which you can add to their knowledge and expertise with an audience. This knowledge may increase CPMs over time, or allow advertisers to develop more effective programs and creative. This will not make a buyer pay $20 CPM over a $5 CPM, but over and over buyers tell us that they are loyal to networks that add to their knowledge and provide game changing ideas.

CONCLUSIONS

There are many reasons why ad networks are playing a large and growing role in digital. These factors, coupled with the massive multiples investors demonstrated a willingness to pay for such networks as Glam.com, Blue Lithium, and 24-7 Real Media, have made ad networks the “darlings” of 2008. As the market has grown, networks have specialized into broad reach horizontal, niche-focused vertical, and new media categories, all of which continue to get play in the marketplace.

But as is typical in an emerging business area, there will likely come a day of reckoning when the market culls the weaker companies and concepts and consolidates more share and revenue in a small set of major players.

As companies contemplate entering this space, they need to take a hard look at their network concept to ensure it is strongly differentiated. Because great ideas will profit, but weak ones will surely wither and die.