3 Steps to Targeting Nirvana, Bennett Zucker Gives Us Open Market Benefits that will Improve BT

Go-Bennett, a great article in iMediaConnection on Thursday.  Three Steps to Targeting Nirvana defines behavioral targeting today and outlines an open marketplace, an open technology platform and what he characterizes as ‘an open mind.’

Up front, Bennett makes the argument that the onus of responsibility for accurate and aggressive BT should not fall on publishers.  Efforts results in wasted inventory, poor performance and lack of attention that should truly benefit the advertiser.  Advertiser-directed BT is where it’s at.  We have the technology and the science is far more impactful.  In fact, Bennett does a great job of presenting an example of a car-buying scenario which illustrates how advertiser-driven BT better serves publishers.

In the section on open market place, Bennett tries to present a clean argument.  Advertisers ideally should have the opportunity to cherry pick the inventory they buy, so as to promote the opportunity to select the inventory that will meet their BT needs.  I know that Bennett has struggled with the “I don’t want to be a self-promoting author” and so kudos for giving us several examples in your story.  Right Media is clearly the leading auction exchange model in the space.  But AdBrite is a solid player and a good alternative for people to be looking at, especially if they want to have an alternative to Right Media or want to investigate options before jumping into bed with a specific vendor (if you can even call RM a vendor, more like a facilitator). 

Anyway, Bennett is trying to paint the utopian picture for us here – advertisers cherry picking inventory.  I know that in theory that is what the auction model enables you to do – bid on the inventory that you want and forego that which you don’t want.  But most of the inventory on the Right Media Exchange is network  inventory so you really can’t be so laser targeted.  The RM Direct Exchange, however, may be something to look at in terms of publisher-specific inventory.

Bennett is honest to himself and us insomuch that he acknowledges that networks are inherently limited by the design of only being able to offer BT within their own network.  So even if you could cherry pick the inventory you wanted, you could only deploy BT on that network.  Using an ad server with BT would overcome that, if the ad server BT can be deployed across the networks.  Bennett surprisingly does not go into this in his article.

Here is where I think the article could use a fourth and maybe even a fifth section.

Requirement 4 – Ad serving that Re-targets With BT Agnostically

Several ad server offer BT that can extend across multiple networks.  Event-based BT like Boomerang by DoubleClick for example can enable and advertiser to track behavioral of people who have been on their site and then target them across the web – including across networks.  If an advertiser were to deploy event-based BT in conjunction with selective inventory buys on an auction exchange, they could be deploying BT with far more refinement.

Deploying first party ad serving by TruEffect is a second alternative.  With first party ad serving, the inventory acquired through the auction can be targeted using re-targeting methods of the first party cookie and any existing customer can be recognized and re-targeted in real-time.  Treated like any other inventory, all inventory bought through the network could easily be re-targeted using a DirectServe™ implementation.

Requirement 5Ad Serving that Integrates

A final consideration today, and a growing requirement is a concept that I have heard advertisers call a ‘universal’ or ‘megapixel.’  In the days where sites are getting tagged by ad servers, publishers, networks, site-side analytics and pretty much any other tracking mechanisms, there is a need for a single pixel that can shoulder other tracking beacons.

Dynamic Logic’s Universal Tag is one example of this kind of technology.  Shouldering multiple tags, this universal pixel enables an advertiser to tag the site one time.  DoubleClick has an alliance with DL so that they can offer this solution to their clients.  TruEffect has a similar technology called TruTags™ whereby they have one tag that is placed on the site and through it, multiple tags can be managed so that an advertiser only has to tag the site one time and any other tags can be added or removed through a single common interface.  The piggy-backing enables the advertiser or agency to eliminate the need to go back and keep tagging the site eveytime a new netrok buy comes into play.

The great benefit of these megapixels is that with Bennett’s story, one could buy inventory at auction – which will almost always be network inventory – use an ad sever that deploys BT like event-based or First Party DirectServe™ and then use a universal tag or megapixel to reduce tagging requirements as each new network is bought.  Snazzy.  Good article Bennett.

Reactionary with Insight.

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Right Media Offers the Private Label Publisher Auction Tool I Am Looking For

I always promise to seek out and find solutions that make a difference and I encourage us all to demand technology to push us to improve how we manage our online advertising initiatives.  Sometimes I find them and sometimes they find me!


This past week I touched on Right Media and the concept of online auctions as a mediated exchange between buyer and seller.  I also presented the argument that there are too many hands in the pot with this model.  Right Media’s new “Direct” product elevates the inventory quality potential by only bringing in publishers as opposed to it’s traditional exchange which is largely comprised of networks and non-premium inventory.


I had the delightful opportunity to speak with Bennett Zucker from Right Media yesterday.  He called me the “mad man in the mountains.”  LOL.  We actually had a great conversation and spent a lot of time sharing ideas.  But one thing that Bennett shared with me I am bringing back to you.  Right Media will private label their exchange technology.  My challenge has been met.


In my Disintermediating Ad Exchanges, Publisher Ad Auctions (http://arikaufman.com/2007/02/07/disintermediating-ad-exchanges-publisher-ad-auctions.aspx) I asked you to find a technology or develop a technology that would empower publishers to cut out the middle men so that they could run their own inventory auctions.  Right Media is doing just that.  I did not ask how much penetration they have or how many clients they have, but I was really pleased to learn that this exists.


Let’s look at the publisher technologies. 


Ad servers are pretty well covered, however meekly.  None of them are that great, as we all know, since every trade show floor is full of publishers wandering around looking for “that” platform, which can actually forecast inventory with a degree of accuracy and to save them lost monthly revenue. 

Publishers have whittled together DFP and Omniture and perhaps some additional Business Intelligence tools to create some insight into what is available to sell.  That’s the closest I have seen.  But the inventory insight is never more than a week or two out.  Yahoo has a room full of people calculating forecast models and they only get about a month out before their accuracy rates drop sharply. 

Basically you just sell an approximation of what you think is safe to sell, and make-good on what you over-sell the following month.  Publishers frankly have to rely heavily on networks to backfill the inventory that develops last minute, because they have no way of predicting what will be there in advance.

So we rely on networks to take on the excess inventory and they sell it cheap.  We have no way of knowing monthly over month exactly how much inventory we will give to them, and we tend to turn the dials up towards the end of the month as our direct-sell customer’s campaign commitments are being properly met. 

Enter the auction.  The Right Media Direct auction is a legitimate alternative to a network and, it seems, may be offering higher returns for publishers than networks (in some cases). 

Direct offers publishers the opportunity to push higher value inventory into an auction than they might otherwise have done with the exchange service.  They can do this last minute, with what they haven’t sold.  The result is that less inventory will flow into the networks, which offer low returns, and whatever the network doesn’t sell will probably end up back at auction again in the traditional exchange anyway!  That’s a nice model.  But not what I was hoping for.


What I like is that Right Media will enable a publisher to run their own auctions in-house.  They will private label the technology.  So a publisher can sell their own advertising directly and then run excess inventory through their own auctions.  Quality inventory that doesn’t sell can go to the private auction rather than a network who returns less for it.  This is not the top-level inventory that they sell directly, but it’s better than that which should be getting farmed out to networks or to Right Media’s exchange auction. 


Publishers will retain a higher yield for their inventory while simultaneously moving more of their inventory directly.  This I like.


This self-directed publisher auction model will enable a site to increase sales without having to increase their team or the costs associated with growing the operation.  In fact, they may even find that they can move more inventory with less people!  From my publisher days, there was always that juggling act.  How much inventory can a sales person sell.  A top-performer vs. and average performer.  What is the ramp-time of a new hire.  A direct-selling auction tool offers a publisher the opportunity to have their own clearing house with a much higher return value than their current network clearing house options.  I really like this.


Right Media has a solid set of models here.  They are a destination for remnant inventory that a network can’t sell or for publishers that would prefer to work with the auctions directly as a clearing house for non premium inventory.  Advertiser’s like it because it is an easy way to buy advertising and is increasingly familiar due to the commonality of search advertising auction-style buy models.  With regard to publishers who participate directly, advertisers know exactly where their ads will run, which they prefer to networks.  And the private label model offers publishers the opportunity to auction-off more premium inventory to advertisers directly.  This will help them retain a greater share of their own advertising revenue and will offer advertisers the opportunity to get access to more premium inventory at a lower rate because the auction model will offer access to better rates.


So in the end, I really appreciate the call Bennett.  We found something that we were looking for.  Now I know that there are solutions for publishers to manage auctions both for Search and Banner advertising directly.  Superb.  Great talking to you.

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Disintermediating Ad Exchanges, Publisher Ad Auctions

On January 27th, Brad Berens wrote in iMediaConnection about Right Media Exchange’s new Right Media Direct in his article, Right Media Direct Ad Exchange Launches.  


“While the larger Right Media Exchange boasts 50 ad networks, Right Media Direct has nine — Accelerator, Active Response Group (ARG), Adtegrity, Banner Connect, CPX Interactive, Directa Network, Oridian, Remix Media and Rydium — that compete for a publisher’s inventory in a real time auction” – Brad Beren, iMediaConnection


The short-version of this is that Right Media is empowering advertisers with the ability to buy all of a publisher’s inventory that is available from all of the participating networks in Right Media Direct as opposed to just the inventory available through one network, as with Right Media’s traditional auction-based system.  This becomes a lot more like a direct-selling model for publishers and advertisers except for there being two intermediary players, the networks who take their cut and then Right Media who takes their 7.5% piece.


So why don’t publishers bypass the networks and just dump their inventory into Right Media directly?  Well a lot of them do.  But what about publisher’s whose inventory is landing there through a network, will they ever know about it?  Probably not.  At least not for a while.  The inventory that they give to the networks that the networks will give to the auction will be chopped up so badly that the pubs will see such small dollars in return that they probably won’t even look into it.


But it doesn’t have to be that way.  And there could be more revenue there to be had.


“Greg Stuart, chief executive of the Interactive Advertising Bureau, said he could not comment directly on Right Media Exchange, but said the notion of an online ad exchange is not new.” – C|Net’s Right Media Launches Online Ad Auction.  But there are some inherent differences here.


Right Media is a mediated exchange between publishers and advertisers.  Forget about the networks but the publishers that are participating directly are of greater interest.  Personally, I think that the major publishers whose inventory that is landing on Right Media will become aware of the two-player intermediaries and will cut the networks out and go to Right Media directly.  Eventually.  Auction-buying is getting more popular and while networks is a great why to dump excess inventory, advertisers are also looking at auctions now too as better inventory is starting to show up there. 


Auction-revenue represents greater potential to publishers if they go direct.  Obvious-man.  But then this is not just an auction system.  Right Media is putting the buyer and seller together.  Or are they?  Buyer and seller never meet.  Right Media is in the middle.  So I guess there is a final step missing here.  Buyer and seller come to RightMedia and conduct a transaction.  Only those publishers that use Right Media will be available to advertisers that come to Right Media.


What if you eliminate the middle man.  How do you make it so that any publisher can reach any advertiser and vice versa? 


What if you could do it on any web site directly?  What if you could log in to a publisher’s site and participate in an auction and buy their inventory that way.  Set a max, your budget, your ad specs and let the auction run.  The publisher could input their available inventory and whatever they don’t sell directly would run through their auction-tool. 


What am I getting at?  Publisher-direct auctions.


Obviously some third-party audit would need to come into play here to verify the validity of the tool (think I/Pro or Neilsen), but how cool would that be.  Forget the auction network model which is limited by those sites or networks of sites that participate.


Yahoo!, which has a minority stake in Right Media has its auction-based search advertising model on its search engine.  Sponsored Search is an auction-based pricing model.  You can go in and do the same thing with search as you can do with Right Media – buy search on an auction system.  But you can only buy on Yahoo!.  You can only by on Google through Adwords.  Same with MSN through AdCenter.  And so on.


In the past I have talked about LookSmart’s AdCenter which will allow a publisher to take on the search CPC sale directly, so that they can step out from under a network.  This allows for the capability to sell direct to advertiser with an auction system.  Advertisers can go to ASK.com directly and buy contextual search without having to go through a network.  Imagine being able to do the same with The Wall Street Journal, WebMD or C|Net.  Go and login to an auction tool, set you min/max, your budget and keywords and let it run. 


So there is an example of a publisher auction selling tool for search.


LookSmart has it for search.  I also think Quigo does too.  You would have to check it out because their Web site does not give much information.


Back to banner advertising.  Challenge to the industry: Offer publishers an auction tool to sell their own remnant space.  Maybe LookSmart’s tool could be tweaked to do this.  Maybe one of the ad servers can be enhanced to do this.  Maybe they need to buy an auction tool and integrate it to bring this capability to publishers.  But it would seem to me that if publishers could wrap this in, advertisers would jump all over it.  Eliminate the middle men and publishers can capture more revenue, undercut the current cost models and advertisers can take control over exactly where their ads are running. 


Your thoughts?


Reactionary with Insight. 

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