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Old 08-21-2001, 04:10 AM   #1
Rendelius
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Question Would this ad network idea make sense?

I am thinking about the following: an ad network that only represents highly targeted, content oriented sites in about 10-20 categories. It will only accept high quality sites, not really looking for high traffic but outstanding content and user loyality.

This network would only do two things: broker banner advertising for the categories and try to run promotions for advertisers on fitting sites.

This way, publishers should make higher profits and advertiser find their target audience. The network would NOT do RON campagins and would NOT serve defaults.

Would such an ad network stand any chance in the current markets?
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Old 08-21-2001, 07:53 AM   #2
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Bernhard, could you please expand on what you mean when you suggest that the network would serve no defaults?

I ask this since even in a boom market, defaults are necessary for the flexibility that they provide. That is, if a site or channel is desired by an advertiser (say Vivendi Universal) to promote an upcoming film release. The advertiser requests that her ad be granted 1,000,000 views within two weeks on a particular site. If that site was serving no defaults or RON ads, this may conflict with other contracts and either hinder the campaign, force you to renegotiate to the detriment of all parties, or force other campaigns off the site.

Also, if you fail to sell 100% of a participating property's inventory, what would be served in place of defaults? Do you mean that the ad space would simply remain blank?

Of course, a focused and niche-oriented network can always offer promise, so I'm interested in hearing more about your idea.
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Old 08-21-2001, 09:19 AM   #3
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Czar,

at least will try to

Let's construct a hypothetical ad network that would only accept high quality sites related to gardening and indoor plants, having those two categories.

First of all, this network would refuse to accept anything but CPM campaigns for banners. If an advertiser insists on a CPC or CPA campaign, the network would calculate the campaign price based on what is known to be an average CPC or CPA price for the category and translate it to CPM, charging higher CPM rates because ads will be targeted. For this reasosn, the network would also reject campaigns that are not related to the categories it is representing. While this may look like a bad business decision, it could pay out because you can concentrate your marketing efforts towards advertisers on the categories you'd like to target, lowering the costs of marketing. Comapnies dealing with gardening should think: "Ah, the gardening network" and this could put you top of mind with your prospectives. Accepting only CPM creates a feeling of simplicity ("it is known that banners for gardening targeted at the proper audience can generate .x% clickthroughs, so for XXXXX Dollars I should get xxx Clickthroughs then"). Since (if the positioning of the banner is guaranteed) clickthroughs only depend on he quality of the banner, it would be fair against the publishers - since they have no influence on the quality of the banner, but serve impressions (and this is really the only thing they can do).

So you won't find "shock the monkey" ads on this network, nor ads for the latest GeForce graphics card. Even credit card banners won't show up there. although garden owners certainly need credit cards - but they don't come to gardening sites to look for them. They are better advertised with other sites.

In this exmple, there would be of course RON campaigns (like, for example, for a universal fertilizer). But the more subcategories you have, the less often this would happen.

Now - what does "serving no defaults" mean? It simply means that if there is no ad targeted to a site, the ad network won't serve a non related ad. The publisher can specify a default of his own (like with Burst!), but this one would have to be related to the category as well like a link to gardening books on Amazon for his own Amazon shoppe). Thus, they would have to be approved by the network - a novelty, I suppose. The reason for this is that being consistent in the ads served would add to the credibility of the site, thus adding to its value for advertisers.

A very important thing would be that the ad netowrk would also help to get promotions going on member sites. Say a vendor for bonsais wants to establish his business with gardening fans, the ad network would help him to find sites where he could promote his articles. This could be done in a way that - within the site layout, a single page with his "ad" could be served via a java applet (like syndicated content). Done right, this would seamlessly integrate with the sites' design. All the publisher would have to do is to create the page frame, include the code and put a prominent link up.The goal is to build a closer relationship between advertisers and publishers, in a way that they can better understand the others needs.

Puh, it's hard to write a conclusive posting in a foregin language when you only see a small fraction of what you have written so far, so I will stop for now and wait for your input and comments.
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Old 08-21-2001, 12:14 PM   #4
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You've just described an ad network with defaults. Most networks that serve defaults will let you put in a place to use another network over default banners. An ad network with no defaults means they can fill 100% of your ad inventory with a paying banner.

I've never run "default" banners on i-clicks. And I don't think I ever will. We have a house banner, but we pay for them. I haven't run it in awhile though. I pay for the house banners because I am advertising on your site, and I think the publisher deserves it. I was actually surprised that people would let a company run 70% defaults on their site, and still recommend them. Even when my ads get low, I put up paying banners to other sites I'm involved in one way or another to generate revenue that way.

The CPM part of your ad network sounds good, but where do you plan on getting all these advertisers that are paying so much? Good advertisers aren't just sitting around waiting for you to start up an ad network. It takes alot of hard work to bring in new advertisers. I don't think you would get enough advertisers to be so picky on the deals you get. What will you serve for banners until you get advertisers? Where are you going to get the inventory? How much are you going to pay your publishers? Where are you going to get the software needed to run the banners?

Starting up an ad network is not an easy thing to do. Keeping it running and profitable is even harder at times. Ad companies are dieing all the time, how do you plan to stay afloat during the hard times?

It's nice to talk about a high paying CPM ad network, but I don't think it's that easy.
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Old 08-21-2001, 01:05 PM   #5
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I didn't say that I would start that network - I just thought about how this could work.
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