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With The New York Times reporting that there are over 200 ad networks operating in 2008, and other Internet sources putting the number closer to 400, it is clear that an advertiser has a wealth of options from which to choose. But the mere availability of choices does not necessarily mean that all of these options have a distinctive reason for being. You need to be able to find the right networks for you. Helping you do that is what this white paper is about.
WHAT ARE AD NETWORKS?
Ad networks aggregate online advertising inventory from a variety of sites and provide a single vendor solution for advertisers. Brands work with ad networks to buy advertising across some or all of the sites they represent.
Historically, networks were a source of cheap tonnage – and there was a reason why so much ad network inventory was cheap. By aggregating pages across huge numbers of not_well_vetted sites, advertisers had little or no control over where their messages ran or if they appeared on inappropriate content. Thus advertisers placed minimal value on networks as a whole, or were simply unwilling to run messages on them. Naturally, networks took notice of all this advertiser angst about their inventory and made critical changes. The first step was a dramatic improvement in the quality of sites that were represented by networks. Good networks dropped dodgy sites, and began offering contextual channels that represented far greater value to marketers. You can still get low cost inventory from many networks, but as the network business has expanded so too have networks’ ability to offer other benefits to advertisers.
By mitigating quality concerns, ad networks gained the trust of even the most conservative advertisers. They also made incredible advances in technology, including leading the behavioral targeting space. Now advertisers look to networks for a host of value added benefits:
1. Behavioral targeting and retargeting.
2. Easy to reach “vertical” targets like auto buyers, or women, or sport enthusiasts.
3. Onestop advertising on midand longtail sites.
4. Connection to the passionate – people who demonstrate energy and loyalty that can be channeled toward brands.
5. Large amounts of inventory on short notice.
6. Broad reach and heavy frequency beyond the reach of the portals.
Publishers offer ad networks some of their best inventory because ad networks add value in many ways.
Different Kinds of Networks
Years ago, there was really only one kind of network, a “general interest” or horizontal network that aggregated content from thousands of small sites across categories and targets. Buyers could select a broad reach “run_of_schedule” buy, or focus on a particular demo. Some examples of the largest horizontal ad networks include:
1. PlatformA
2. BlueLithium
3. ValueClick
A more recent development in the area that is driving such rapid growth in terms of category revenue are vertical ad networks. Verticals specialize in a particular type of content or audience, and represent only sites related to that “vertical.”
The growth in vertical networks is the result of burgeoning consumer interest in niche sites. Dollars are following consumers. Lehman Brothers reported 43% growth in overall ad spending on vertical categories in 2007, versus a 5% decline in spending on the portals. Consumers are spending a greater proportion of their Internet time on specialty sites.
Some examples of vertical ad networks:
1. Glam Media represents sites targeting women 1849.
2. Sportgenic targets sport enthusiasts, be they participants or fans.
3. Jumpstart Automotive aggregates auto impressions across auto sites and its behavioral targeting network.
and console gaming. Many people call these platform networks. A few examples:
1. Ad Infuse™ aggregates mobile ad opportunities across mobile sites.
2. AdMob also aggregates mobile impressions across mobile sites.
3. Double Fusion brings together ad opportunities across XBOX®, Playstation® and Nintendo® console games.
In sum, as the number of ad networks has increased, so too has the degree of specialization in the category. But the basic concept – aggregating impressions across sites so that marketers have an easier way to reach consumers and avail themselves of better targeting and executional knowledge – has remained the same.
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