It is interesting to witness the new focus towards vertical ad networks, and away from the previous model of broad-reach, broad-targeted networks. The first wave of the network model focused on large reach networks, such as ValueClick and Advertising.com. These companies aggregated a large volume of audience for advertisers, and allowed for contextual targeting and demographic targeting, mostly via contextual relationships. The second wave focused on behavioral targeting being layered over the existing infrastructure, offering advertisers the ability to reach the same audience either contextually or based on previous traffic patterns and usage, thereby giving birth to behavioral targeting. The current trend appears to be focused on building a singular portal to reach a specific audience by tapping into them via a collection of smaller to medium-sized sites of a similar contextual relevancy. One of the first players in the category was Gorilla Nation. The company amassed a large collection of sites reaching the entertainment category, and has continued to build them over the last few years, while acquiring more into the mix. Recently, we saw Jumpstart Automotive Media being acquired by Hachette Filipacchi, aggregating together a large collection of automotive targeted sites and inventory. This deal enabled Hachette to build relationships with larger portals to weave together its inventory, either contextually or through behavioral targeting, to reach in-market auto buyers.
Even the start-up world is getting into the act, with properties like Real Girls Media and its first site, DivineCaroline. These start-ups are trying to pull together women-targeted sites in much the same way that early trailblazer iVillage did, but is focusing on the Web 2.0 elements such as blogs and user-generated content. Going beyond the network model, we are even seeing the development of platforms and services to help advertisers reach the types of verticals they are interested in. Centro is a platform and service that objectively aggregates together local online content for advertisers, while Adify is a start-up that builds vertical networks for specific advertisers, to reuse that inventory, building a marketing asset for later growth. All of these models signal the shift away from large aggregate audiences towards the development of solutions to reach the long tail and provide advertisers with the ability to go deeper into the lives of their audience. This is a means for reaching the portal audience without advertising on the portals. It is a means of going around them when they cost too much or wanted too much in the form of an upfront deal. These are all ways to build to the ever-important tools of reach and frequency. These long-tail vertical networks provide access to a targeted audience at a lower cost, in a way that is attractive to advertisers. You are able to do more than just run banners and buttons. You are able to run large page take-overs and larger rich media units, but in a smaller, more efficient, and possibly more effective environment. The venture capitalists seem to have gotten the message loud and clear. The majority of the dollars are going to business models that are focused on video and vertical. Of course, that means that a vertical video network or platform would be the most attractive option for VCs and advertisers alike.
Thanks Cory Treffiletti, May 2007.
Even the start-up world is getting into the act, with properties like Real Girls Media and its first site, DivineCaroline. These start-ups are trying to pull together women-targeted sites in much the same way that early trailblazer iVillage did, but is focusing on the Web 2.0 elements such as blogs and user-generated content. Going beyond the network model, we are even seeing the development of platforms and services to help advertisers reach the types of verticals they are interested in. Centro is a platform and service that objectively aggregates together local online content for advertisers, while Adify is a start-up that builds vertical networks for specific advertisers, to reuse that inventory, building a marketing asset for later growth. All of these models signal the shift away from large aggregate audiences towards the development of solutions to reach the long tail and provide advertisers with the ability to go deeper into the lives of their audience. This is a means for reaching the portal audience without advertising on the portals. It is a means of going around them when they cost too much or wanted too much in the form of an upfront deal. These are all ways to build to the ever-important tools of reach and frequency. These long-tail vertical networks provide access to a targeted audience at a lower cost, in a way that is attractive to advertisers. You are able to do more than just run banners and buttons. You are able to run large page take-overs and larger rich media units, but in a smaller, more efficient, and possibly more effective environment. The venture capitalists seem to have gotten the message loud and clear. The majority of the dollars are going to business models that are focused on video and vertical. Of course, that means that a vertical video network or platform would be the most attractive option for VCs and advertisers alike.
Thanks Cory Treffiletti, May 2007.
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