I-level calls for more effective ad planning

The vexed issue of online media buying and selling has once again come under the spotlight with a prominent media specialist claiming advertisers are being shepherded towards an unhealthily small number of websites.

I-level, which bills itself as the UK’s leading digital media agency, has launched a drive to encourage agencies and advertisers alike to widen their horizons when it comes to online media selection.

The campaign has been driven by official figures for online advertising spend. Although a recent PricewaterhouseCoopers/Internet Advertising Bureau study showed overall spend for the first half of last year was up 42 per cent year on year, it also revealed “yet again” that 89 per cent of all advertising was placed on just ten media owners’ sites or networks.

I-level claims its top ten sites receive just 39 per cent of its advertisers’ budgets. Deputy managing director Faith Carthy says: “Digital media can now provide very effective reach across many target groups, but not if brands limit themselves to the same clique of sites every time. Advertisers quite simply cannot get the best value out of their online budgets from such unimaginative media planning.”

I-level’s criticism has opened up a wider debate about which companies are best qualified to sell online ads: third-party “specialists” or the websites themselves? In the post-bubble Internet world, and given a general downturn in all advertising (offline as well as on), websites no longer feel in hock to the once all-powerful intermediaries such as Doubleclick and 24/7 Media.

Since advertising is not the make or break panacea it once was, many websites now have more time to experiment on their own behalf.

One example is financial products site Moneysupermarket.com. Chief executive Simon Nixon recalls: “When we launched just over two years ago, we turned to Doubleclick’s expertise because it already had extensive contacts in ad sales and knew where we could fill our ad space straight away. However, we found that it was selling our ad space at the same cost per thousand (CPM) rates as many of its other clients, and to the same advertisers. We knew that in the financial sector we could sell it for more if we took it in house, and made our approach much more targeted.”

Nixon claims: “We managed to double our CPM rates immediately.”

After learning lessons from such experiences, Moneysupermarket.com started to tinker with the structure of how it sold space – linked to prominence on the site and anchor deals on its various channels. Nixon says: “Taking our ad sales function in house from Doubleclick and using our targeted strategy has increased our ad revenue seven-fold.”

Another website owner – prominent in the online estate agency market but which prefers to remain anonymous – had a similar experience. “We brought our ad sales in-house from Doubleclick,” says the source, “because we felt that an in-house team would have a more in-depth knowledge of our particular market. Consequently, we could develop a more creative and integrated package for advertisers, while increasing ad revenue.”

Doubleclick was unavailable for comment, but AdLink, which recently acquired much of Doubleclick’s ad sales arm, cautions websites to think before going direct to their advertisers. Managing director Richard Holman says: “Certainly, some sites probably had a very distant relationship with their sales house. But what is not mentioned – ever – is the massive costs and overheads associated with taking a site’s ad sales in house. Profitability must be a measurement. That is why the number of websites turning to ad sales houses far exceeds those going the other way.”

Holman claims the average Adlink client sees a 37 per cent increase in ad revenue within three months of appointing it, and a 46 per cent increase in advertisers within six months.

Nevertheless, these leaner times are likely to keep the online sales houses on their toes, with growing pressure coming from advertisers as well as media owners.

As the head of Internet marketing for one well-known retailer – and online advertiser – puts it: “I’m starting to think we would be better off doing ad deals ourselves, especially if we intend to have a partnership with the website. We advertisers are strapped for cash, so we’re much more likely to be hard-nosed and demand evidence of the added value that sales houses are supposed to provide.”

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