ChasNote

From yesterday’s WSJ in an article about traditional publishers acquiring web services platforms like Conde Nast’s acquisition of FM alum Reddit.

“Usually when publishers acquire technology companies it’s to spruce up their own Web sites. But increasingly publishers such as Conde Nast and Meredith are drawing on the technology to create advertising campaigns for marketers.

“This takes publishers further into the realm of marketing services. Instead of simply selling marketers ad space, they’re rolling up their sleeves and designing the promotions as well. For the next five months, visitors to the Dillard’s Web site will be able to rank products featured in a top-10 list selected by Conde Nast’s Lucky magazine and fashion Web site Style.com. The fashion lists will rotate seasonally, giving visitors the chance to rank new items every two weeks. The top-rated item on the list then will appear in Dillard’s online ads running on nine Conde Nast Web sites, including Teen Vogue, Glamour, Style.com and Vanity Fair.”

Smart. Also not surprising. High-end offline media companies have always had staff and production capabilities to provide marketing services well beyond trafficking and inserting commercials. This is part of what drives premium rates at leading media brands. Advertisers expect their media partners to do more than cash their checks; they demand that their media partners help them succeed among an audience that the media companies know best.

This is why I was confused by news that ESPN has discontinued working with ad networks. I get it that ad networks cause pricing and channel conflict because — despite promising publishers like ESPN to sell their remnant inventory in a blind manner, as part of a “channel” — they sometimes pitch site-specific opportunities. They offer lower rates for the same banners ESPN sells directly. This is a partnership problem, a serious one, but one that should be addressed with tactics short of termination. It’s not religious problem, as ESPN and others have portrayed it. From Mediaweek:

“ESPN’s decision crystallizes a philosophical debate in the online ad sales industry that has intensified since the Interactive Advertising Bureau’s annual meeting last month when during a keynote address, Martha Stewart Living Omnimedia media president Wenda Harris Millard gave her now famous warning against selling Web inventory like ‘pork bellies.’”

My interpretation of Wenda Harris Millard’s pork-bellies battle cry is this. Digital publishers need to remember that they are publishers — companies that engage with high-quality audiences around content in a unique and magical conversation, and service firms that know how to chaperon marketing brands into those conversations. In other words, companies in the mold of Conde Nast, Meredith and ESPN that offer high-touch marketing services.

Whatever ad avails you don’t sell, offer up on the pork-belly exchanges — online we call them ad networks (or Google Adsense), in TV we call them PI or DR rep firms. Hey, people sometimes want pork bellies, and audiences almost certainly don’t want 30-seconds of white static whenever a TV network fails to sell 100% of spots.

But if you don’t or can’t articulate what it is that makes your media brand uniquely valuable to your marketing partners (hint: it’s not your demographics), you’ve ceased to be publisher.

More on the difference between publishers and ad networks from Battelle.

Caught in the act by AdRants, Disney family resorts ads have been running alongside near-porn photos and content at sites such as Egotastic.

“Last Fall, some contextually placed Disney ads appeared in a webcam video of ‘Andrea’ fondling her breasts. Now, a series of banner ads are appearing on celebu-porn site Egotastic next to Keeley Hazell covering her breasts, images from a Kristen Davis ’sex tape,’ images from a Lindsay Lohan sex tape, Denise Richards displaying her crotch and more. Screenshots are here. No nudity per se but possibly NSFW. More than likely the ads appeared on Egotastic as a result of a blind buy with neither the agency nor Disney having knowledge. It’s yet another reason why blind buys are rarely a good thing for most brands, especially one so very conscious of its family-friendly image.”

Battelle takes a deep look at the difference between media companies and ad networks at Searchblog, and how the big online portals are confusing the two.

“Do we [in the media business] sell inventory to the highest bidder via algorithms, automated processes, and platforms? Or do partner with marketers and creators of media to build brands - both media brands, and consumer marketing brands?

“I know how the folks who no longer work at AOL, Yahoo, or MSN feel about this question. They’re all brand people. And it’s entirely clear how the Google-chasers have answered that question: They’ve collectively spent billions of dollars amassing ‘access to inventory’ and ‘ad platforms’ in single-minded competition with Google.

“It seems the future, according to AOL, Yahoo, and Microsoft, is in ad networks.”

Meanwhile, one of the top brands in quality content and marketing relationships with global brands, ESPN is severing ties with ad networks:

“The sites like ESPN have cut ties with Specific Media and several other ad networks saying that ad selling that relies heavily on arbitrage and algorithms is not for them. ‘We’re heading down a path where it no longer suits our business needs to work with ad networks,’ said Eric Johnson, Vice President, Multimedia Sales, ESPN.”

I was at iVillage, getting my daily fix of sex tips from “Love Bytes with Tracey Cox”, when I was struck by the unlikely line-up of advertisers. A pre-roll video ad for Crystal Light used the uncomfortably apt tag-line “Pump It Up” for a segment on improving hand job technique by watching your man masturbate. I know you don’t believe me, so here’s a screenshot:

I assumed this to be an unfortunate, if funny, snafu created by a behavioral-targeting engine that misfired, so I refreshed the page. Next up: Kraft’s Cool Whip whipped topping. Hmm. I refreshed again. Then — continuing through the Kraft brand portfolio — Oscar Mayer, the folks behind the famous 1963 made-for-TV song “The Oscar Mayer Weiner Jingle.” Oh no, I thought. Someone in Kraft’s online marketing department just lost his or her job!

Unless, of course, this is part of something bigger. A multi-generational, cross-platform subliminal messaging campaign that started with this risque 1952 promotional give-away.

(Screenshot grabbed from Kraft’s official website.)

Thanks, Neil!

From Adweek’s coverage of a panel at Ogilvy’s Verge conference. Outgoing Facebook chief revenue officer Owen Van Natta defended the company’s Beacon advertising concept, while Gawker’s Nick Denton slapped back:

“Gawker media publisher Nick Denton said he believes the ‘innovation’ in social media ad models is mostly a result of their failure as media properties. Even MySpace gets higher click rates than Facebook display units, he noted.”

FM’s Battelle disagreed:

“Not all ads on Facebook perform poorly, though. John Battelle, founder of Federated Media, said Facebook applications like Graffiti Wall are running ad campaigns for companies like Dell that are performing well by all metrics. ‘There’s no engagement in ad networks,’ he said. ‘We haven’t yet figured that out yet, and I think social media will.’”

From an interview at Silicon Alley Insider:

“SAI: Haven’t ad networks played a role in holding down online CPMs?”

“Moore: I dont think its the networks that are doing it. I haven’t spoken to anybody who thinks media fragmentation is going to stop. I think we are dramatically underpriced compared to offline. The amount of money newpapers and magazines have been getting per thousand is outrageous. Newpapers and magazines are still getting roughly 30% of all advertising expenditures–yet if you look at their share of media usage, they’ve got between 7% and 9%. Thats why they’re having so much trouble.”

Oh, come on. Google and the ad networks are selling clicks, even when the advertiser signs an IO with the acronym “CPM” after the $0.70 price tag. They are giving away for free the vast majority of impressions, those that don’t generate a click. They are telling advertisers that those impressions have no value. Charging nothing for impressions that make a positive impact on creating demand and spurring consideration is, in fact, charging too little for the service rendered. Google and the ad networks are most certainly deflating CPMs across the media landscape.

I kinda wonder if Kohl’s thought they were buying placement on Glam.com but actually bought a wider rotation across the hundreds of sites in the Glam network.

Is this pizza-box ad for a cockroach exterminator for real, or created in Photoshop? You have to wonder. This kind of a story usually lands in my Humans v Bots category, but this time humans are the losers!

Pizza box from company looking to supplement its income with ads:

The ad runs inside the pizza box, beneath the pizza you’ve just eaten:

Close up of the ad, a photo of a cockroach with a phone number for the exterminator:

From Business Week:

“Social networks have some of the lowest response rates on the Web, advertisers and ad placement firms say. Marketers say as few as 4 in 10,000 people who see their ads on social networking sites click on them, compared with 20 in 10,000 across the Web. Mark Seremet, president of video game publisher Green Screen, stopped advertising on MySpace last spring because of a 13-in-10,000 response rate. ‘It’s really hard to make money on that anemic click-through rate,’ says Seremet.”

Google admits they’re struggling with the same issue, and their stock got hammered on the news.

Meanwhile, advertisers who recognize that building awareness, preference and affinity with customers involves activities other than clicks alone are finding more success in social networks. Examples include Intel, Dell, Wacom and HP, to name a few.

Storage-maker Iomega’s current banners feature flames and copy that reads “Burn, Baby. Burn!” The algorithms of some contextual ad network served the banner alongside the news of a child dying in a house fire. (From AdRants.)