So it would appear that the major publishers have finally realised that allowing the Ad Networks to rep their inventory is a bad move.

Of course it is – it has always been in principle but the practice experienced by publishers in 2008 with plunging network CPMs confirms it. The AOP may not have a joined up policy yet but any publisher – particularly multi-channel needs to think twice about retaining or renewing that network contract.

Why is that? It is basic economics – which will work against you irrespective of the reach or appeal of your site audience to advertisers and their agencies. The value imperative will always ensure that agencies and advertisers will want to pay the lowest price to reach a particular audience to achieve the best ROI. Networks commoditise publisher inventory in achieving mass reach to compete with the major portals. This does nothing more that supress the CPM they achieve on your behalf – and you have to share the revenue. In a scenario where there is more supply than demand due to the market dynamics the position is exacerbated.

Ad networks by definition will never be able to understand the site like a publisher does and therefore will not be able to increase the yield by offering advertisers innovative solutions that enable them to engage with site visitors. To maximise the return from a site’s inventory the publisher needs to have the relationship directly with the advertsiser and their media agency. Only this way will they achieve a reasonable return from their inventory and the advertiser stand some chance of developing campaigns that stand out and engage their target consumers.

Get hiring that sales director.

0 Comment   |   Posted in Uncategorized February 09, 2009