ChasNote

Wow, was this the work of AOL’s contextual-matching ad network Ad.com? That would suggest Ad.com is matching images in ad units to images in news stories, which — as this example shows — is more likely to create awkward moments than relevant associations. The story on the left is about the Colorado boy who, for a few hours, was thought to be riding on a giant balloon. The Quaker Oats ad on the right features creative a guy riding a personal hot air balloon.

That’s the headline for the Business Insider’s Chart of the Day from yesterday, which maps audience size for the leading social news sites.

(Disclosure: I work for Digg.)

Hey, it’s my site and I’m allowed to write snarky headlines.

Officially the news is this, as reported by Bloomberg: eMarketer plans to cut its 2008 and 2009 year-over-year growth forecasts for online advertising by a few more points, which currently stand at 23% and 16%, respectively.

“Google Chief Executive Officer Eric Schmidt said for the first time last month that the company, the biggest seller of online ads, faces a more challenging economic environment. Google’s ads tied to Internet search results are still faring better than much of the graphical banner ads sold by companies such as Yahoo and Microsoft.”

I have no doubt that the online advertising market, across the board, will feel the pain of the broader recession. I also agree that Yahoo, Microsoft and AOL will feel greater pain than Google. But it’s not because Yahoo, Microsoft and AOL — which sell mostly graphical banners instead of text ads — are used by advertisers for online brand-building, and brand advertising suffers more on economic downturns.

While the second part of that sentence is true, the first part isn’t. Most marketers buy low cost graphical banners on Yahoo, Microsoft and AOL for the same reason they buy text ads from Google, to drive clicks and other DR activities. Because they are less efficient DR vehicles than Google, they’ll be cut from plans first. The online publishers that have spent recent years working with advertisers on relevant, high-value, integrated sponsorships (rather than chasing Google) are going to fare better — in relative terms — than those three portals.

Last year AOL paid $275 million to buy Tacoda. Now, according to Venture Beat, AOL is dropping the brand and rolling the technology into Platform A’s Ad.com unit.

“iThis is a shocking move for some, because Ad.com doesn’t target much at all, and offers ads of $1 or less per a thousand views — and is generally considered a ‘bottom-feeder’ by some in the industry.”

Times are tough at ValueClick, too

Another powerful data point from JPMorgan’s Nothing But Net report:

“While portals were once dominant, Yahoo!, AOL, and Microsoft only accounted for ~29% of minutes spent online in August 2007, down from 42% in August 2002. Meanwhile, blogs, online gaming, and social networking websites have experienced double to triple digit Y/Y growth rates in page views. This fragmented audience not only makes it more difficult for advertisers to reach their target audience through only a few publishers, but also makes it difficult for publishers to attract advertisers given their limited scale. We believe that companies that can aggregate traffic through the development of ad networks or partnerships will be more successful in driving growth in 2008.”

According to Nielsen (see NY Times), banner ads for Mitt Romney’s presidential candidate ran 515,000 times on Gay.com. AOL’s Advertising.com, the ad network that accidentally put ads for the anti-gay candidate on the pro-gay (and anti-Romney) site, says the number of impressions was only 32,000.

Romney’s ads also ran alongside pornographic scenes of Harry Potter and Hermione Granger on fiction site FanFiction.net. McCain ads ran on liberal-leaning Huffington Post, Guliani ads ran on progressive DailyKos, Obama ads ran on Amazon alongside a book deemed by Jewish groups to be anti-Semitic.

“Part of the issue seems to be that political strategists came into the campaign season unschooled in the challenges of Internet advertising, and Web advertising sales outlets are not necessarily aware of the unique sensitivities of each presidential campaign.”

I believe the first part — political strategists may not know how online ad networks work. But the second? Oh come on. The problem isn’t that the people at “Web advertising sales outlets” like Advertising.com aren’t politically savvy enough to understand the “unique sensitives” of their advertisers. It’s that they don’t have those people on staff; the ads are targeted and served by computer algorithms that don’t know how to worry about sensitivities.