Mediabids Speech to the SNPA and SNA's Strategic Revenue Summit
Posted on March 05, 2010 by Mediabids
This speech was given by Jedd Gould, of Mediabids, to the Suburban Newspaper Association and Southern Newspaper Publishers Association's Strategic Revenue Summit yesterday.
Advertiser's Expectations Have Changed, So Should You
10 years ago
Mediabids launched and we have been doing per-response advertising in addition
to our conventional online marketplace sales for the past 4 years.
I have been
asked to speak a little bit about response-based advertising and there are
specific methods that we have developed at Mediabids to handle the demand we
have for per-response advertising in print. Not all of these may be right for
your publication but here is how we do it:
-
We
typically work with advertisers who are willing to pay for an unlimited amount
of response.
-
Response
is typically defined as a call, a web visit or a text.
-
Response
based advertising is heavily reliant upon tracking of the response generated by
an ad. At Mediabids we got into charging advertisers on a per response basis because
we saw the need for tracking and better understanding the results that print
ads were generating.
-
Every
ad that we place has a unique identifier, so we know what each publication is
generating.
o
In
2009 we placed 66,350 per response ads for more than 500,000 total insertions.
o
Every
single ad we placed had a unique phone number.
o
We then track using the data generated from
800 numbers to determine what a publication is owed.
o
Advertisers
typically pay based on either a per-call or per-sale basis and the amounts vary
depending on the type of product and the anticipated volume.
-
We
give publications the choice of which advertisers they want to run, we resize
the ad to their specifications, insert the unique phone number or url, upload
it to the website where the publication can download it and then track the
response.
-
As
some of you may know, most 800#s are really transparent pass-throughs, allowing
you to get the information on the caller and then point the call to wherever
the advertiser wants the phone to ring.
-
Because
we are not depending on the advertiser to provide us data on tracking, we know
that the information we use to measure results and then pay publications is
accurate.
Per-response advertising accounts for
a small portion of what Mediabids does. We are primarily a marketplace for
print in which advertising is bought and sold conventionally, in that
advertisers pay for space.
However, what we have learned through
per-response has influenced everything we do.
From what
has gone on in the marketplace over the past 10 years, it is pretty clear that
advertiser’s expectations have shifted faster than publications. However,
despite what you may read or even hear at times at a conference like this,
there is a lot of reason to be hopeful about the future because fundamentally
print works. It is important to keep in mind that advertisers don’t love Google
or Yahoo because they have some affinity to search based advertising. They
spend billions with these two companies because they deliver measurable
response.
At Mediabids
we have about 17,000 advertisers who use our website to buy ads and in most
cases they are spending more in print today than they did 10 years ago. They
are not spending more because we are particularly good at selling (as evidenced
by my dynamic speaking style), they are spending more because print delivers
results and we can prove it.
Suggestion #1: If you are going to talk
to advertisers about response you have to have confidence in your product.
Advertisers never
tell publications that their advertising works. Your sales reps, people with
years of experience, could probably count on one hand the number of times they
have walked into an advertiser’s business or called them on the phone and had
that advertiser tell them their ad was working well. The problem is that
advertisers might be right, they might be wrong. But no one really knows. The
tracking methods that advertisers use are weak. The person answering the phone
who is supposed to remember to ask – how did you hear about us? Is not a
tracking mechanism.
This
constant state of rejection and negotiation creates a type of institutional
insecurity. The result is that many people who work at publications seem to
have a sneaking suspicion that their product just does not work because, in
most cases, that is what their advertisers are telling them- not showing them
mind you, telling them.
If you are
going to compete with products like Google and Yahoo, you have to believe your publication
can generate results and work to make that happen. You have to understand your
readers, their demographics and how that overlays on your advertisers’
products, goods or services.
Suggestion #2: acknowledge that
advertisers have changed the rules
Google and
Yahoo have let the genie out of the bottle. Advertising is no longer about a real
estate style approach to a page –
getting an ad on a good page where people will see it – advertising for most companies
is now about response, advertising for the sake of a brand is increasingly
obsolete for large and small companies and everyday that goes by it becomes
more obsolete. This is true in all mediums. Radio, television and the internet
are all mediums which have adopted per-response based models and succeeded with
them.
If print continues
to suffer, it won’t be because of circulation or because publications cannot
figure out a way to monetize content or their websites or deliver the product
electronically in a compelling way. If print continues to decline it will be
because publications still think they are selling real estate in an age when no
one wants to buy. Google and Yahoo do not sell real estate, they sell response
and results. Selling space against response to a group of advertisers who do
not know how to track their own response is a very difficult thing to do.
I am not
suggesting that per response is the only hope, in the sense that advertisers
should only pay for the response that is generated. Advertisers have changed
the rules, because they have changed their expectations.
Whether you
use a per call, per sale or charge for space in a conventional manner, you are
selling space to advertisers who now care more about the response they are
generating than the benefits of branding. Every time someone buys an ad, there
is an expectation of response and, unfortunately, most publications don’t have
the tools in place to show advertisers how their ads are working. When advertising works and you can prove it,
how you charge is irrelevant. The method of the monetization is academic.
Suggestion #3: Own your data
If
publications are going to thrive in the future they must take ownership of the
results generated by their product. This is the biggest difference between
newspapers and online offerings like Google and Yahoo.
Compare for
a moment two mediums - online and print:
With
Google’s Adwords an advertiser has real time access to how much money they have
spent, how many clicks they have generated and with a simple software install,
how many sales the clicks have resulted in. A quick calculation can determine
definitively whether those ads are paying for themselves.
Now think
about what an advertiser in a daily newspaper does to try to figure out how an
ad is working. A shocking number of
advertisers, who are incredibly sophisticated in measuring other mediums,
depend on the same devices that were available to them in the 1950s – coupons… or worse, asking the customer why they called.
If you have ever had the misfortune to listen to phone calls, you know that the
average American consumer either is uncomfortable answering this question or
has an astonishingly short memory, because few people know. In fact, an
advertiser we work with did a test where they asked their operator to give the
caller 5 choices of where an advertiser heard about a print ad– 4 real
publications where their ad appeared and 1 completely fictitious publication.
The fake publication outperformed 2 of the real ones.
Advertisers
need to be provided the tools to understand how their ads are performing,
regardless of whether they are paying per-response, per-sale, or for space.
Tracking for
print should not be something left to the advertiser.
1) Data is valuable. It can be used in
so many ways.
2) Conventional ad selling is, in large
part, a negotiation and data is a very compelling selling tool.
3) Advertisers are bad at collecting
this response data themselves and should not be entrusted with this job. Left
to their own devices they rarely track results effectively. Mediabids works
with more than 17,000 advertisers and there might be 1% who track effectively
on their own.
The problem
is that when advertisers don’t track, they suspect the worst. We see this first
hand – I started Mediabids 10 years ago because I wanted to figure out a way to
sell print ads using the tools available through the internet. Thousands of
advertisers use our site to buy print ads and four years ago we started to look
into why many of these advertisers were increasing their budgets online and
decreasing them in print.
The answer
was very clear. Our advertisers were not making any effort to track on their
own, we were not providing them with any tools and therefore most of the objections
to spending we heard centered around the “my ad is not working” argument. Nothing to back
it up, no data, no proof – just a gut feel, the ad isn’t working.
Mediabids
got into per-response advertising because we got into tracking.
Like everyone
in this room, at Mediabids we knew- on some level - that print worked but we
didn’t have any data, we couldn’t back it up, we were as insecure as our
publication clients about results. The problem was.. that we really didn’t have
a choice – we were really already selling response based advertising without
any way of validating the response.
I say that
we were selling response based advertising because that is what our advertisers
thought they were buying – we were just doing a bad job selling. Because we
were selling space, not results. Advertisers were spending money- paying for
space - with little concern on our part (Mediabids) or the publicaations’ about
the response that was being generated.
Today we
track everything in both response-based ads and conventional ads.
What we have
learned presents a much different picture than what you have heard about print
recently. Here are a few common denominators of the results across advertisers:
-
Print
is working
-
The
leads generated by print are almost always more valuable than any other medium.
More valuable than radio, television or the internet.
-
The
ROI of print is almost always higher than other mediums.
-
The
close rate on leads generated by print is better than other mediums.
-
The
customer retention rate is better: The customers acquired via print tend to be
better educated about the products they are buying and therefore are
longer-lasting customers.
But
Mediabids’ advertisers only know this because we show them and showing them has
been worthwhile. In 2009 our revenue nearly tripled after doubling in 2008.
Most of our advertisers, who represent a wide cross-section of business types
and geographical focuses, spend more today on print than they did 10 years ago
because we can show them it works.
Please know,
I am happy to get into greater detail of the mechanics of how this is done
later.
As I said
earlier, Google and Yahoo let the genie out of the bottle and recalibrated
advertisers’ expectations but that does not mean that print cannot adapt and
succeed by incorporating some basic tracking and measurement devices. In some
cases that may lead to a per-response deal. In other cases, a conventional ad
sale. But in all cases, we have found at Mediabids, the more data a company has
on the response generated by its ad, the more likely they are to feel like
their money is being spent wisely.
Cuban is Right: Print Needs to Put a Stake In Google's Heart- it is the only way to kill vampires
Posted on February 07, 2010 by Mediabids
Mark Cuban is right. This is why we take every opportunity in this blog to point out that newspapers and magazines need to stop giving away their content for free in the hopes that web traffic will magically result in revenue. It is not working and never will. There is too much online inventory for print pubs to ever realize a premium for their online products. The only ones benefiting are search engines and they make enough money without being subsidized by print.
Full story here
Excerpt from AdWeek:
Content aggregators and search engines are vampires, and newspapers
are the chesty blondes who fall victim to their charms -- and
ultimately get bitten.
That's the basic assessment of the traditional media business'
approach to the Internet, according to Mark Cuban. During a keynote
address today at the AlwaysOn OnMedia NYC 2010 Conference, the
HDNet president/CEO and famed provocateur called for newspapers and
magazines to fight back against sites that link to their
content.
"Everybody wants to take your content," said the Dallas Mavericks
owner before a room full of media executives gathered at the
Mandarin Oriental Hotel in New York. That's not going to change,
"unless you put a stake through their gosh darn hearts."
Cuban particularly called out Google as a Web giant that continues
to reap benefits off of the valuable content that traditional media
companies produce. "Google is a vampire, and you run scared," he
said. "There is no reason to be indexed in Google."
For too long, Cuban said, newspaper and magazines have viewed
traffic to their Web sites the same way that stores view customers
coming through the door -- and have been fearful of turning down
any opportunity for more traffic. Yet, he said, readers who find
headlines via Google rarely convert to traffic, and publishers have
a hard time monetizing that traffic. "You haven't gotten anything
back except that you've turned into zombies," Cuban said.
Plus, in his mind, Google reaps the branding benefit of that
content when consumers access it through a search or through Google
News. "Whose brand do you think [users] have in their minds?" he
asked.
In a Reversal of the Trend - Hearst and Meredith take Online Properties to Print
Posted on February 01, 2010 by Mediabids
Meredith and Hearst are taking two of their online properties to print. As web-based advertising becomes more and more fractured will this be a growing trend?
From Mediaweek. Read full story here
Excerpt from the story-

Meredith, meanwhile, is moving forward with a magazine it tested last year based on Mixing Bowl, an online social network it built around food. Meredith published a second issue of Mixing Bowl.com magazine last week and plans to do another this year while exploring other such affinity-based titles.
In Hearst’s case, Light & Delish will hit stores Feb. 2 with a distribution of 300,000. Priced at a $9.99 cover price, the bookazine is meant to be consumer driven, although it will carry three paid ads from Kraft, which was a launch sponsor of Delish.
Light & Delish is one of several bookazines the company plans to create this year as it looks for low-cost ways to serve up new revenue. Hearst published three bookazines in 2009, based on Good Housekeeping and Country Living, and expects to do at least four this year based on its existing magazines and Web-only brands, which include RealBeauty.com, RealAge.com and Kaboodle.com. Hearst also hopes to turn Light & Delish into a series.
At a time when it’s hard to whip up excitement for magazine advertising, it’s fitting that Hearst sees print as a way to feed its online growth rather than the other way around. Just a year after launch, Delish ranked No. 9 among food sites with 3.6 million unique visitors in December 2009, per Nielsen Online, and the company is eager to fuel that growth.
Meanwhile, Hearst saw double-digit ad-page declines last year across its magazines like O, the Oprah Magazine; Harper’s Bazaar; and Cosmopolitan. The bookazine also is seen as a way to promote Hearst’s other brands like Good Housekeeping and Country Living, where many of the publication’s recipes come from.
Hearst's New E-Reader Designed for Print Compatability
Posted on January 10, 2010 by Mediabids
From MinOnline. Read Full Story here
Hearst Reveals Skiff E-Reader
digital
reading device before the Consumer Electronics Show (CES) was set to
launch this week in Las Vegas. The Skiff Reader will try to distinguish
itself from the Kindle, nook, Sony eReader, QUE and other e-ink devices
with size and portability. The 9 x 11-inch unit will hold an 11.5-inch
(measured diagonally) display, which does out-size the large Kindle DX
and the Plastic Logic QUE. (More images are below.) This display uses a
special ‘metal foil’ technology that offers touch screen interaction
but does not require a glass protective coating. The 1200 x 1600
resolution screen will run at 174 dots-per-inch, which should appeal to
print newspaper and magazine publishers looking for greater detail. The
screen is still black and white, however, and it remains to be seen how
quickly an e-ink display at such high resolution can refresh itself as
it changes pages. One of the chief frustrations of the e-ink devices is
their very sluggish performance and muddy display of images. The Skiff Reader is putting a premium on paper-like portability. It claims to weigh just above a pound. The battery is expected to last a week under standard usage. The device also sports 3G and WiFi wireless connectivity as well as a USB port for side-loading content from a PC.
The Hearst-owned company is putting print publishers front and center in this model. The company says the Skiff will access an online store of newspapers, magazines, books, blogs and other content from a range of publishers. The Skiff is promising to host print brands with unique design attributes, interactive elements, and dynamic content updating “that help publishers differentiate themselves and attract subscribers and advertisers,” the company said in its statement.
Sprint will provide the cellular network for downloading content almost anywhere, but the wireless carrier will also provide a distribution channel. Unlike the Amazon Kindle (available online only), the nook (available in Barnes & Noble) or the Sony eReader (in bookstores), the Skiff will leverage Sprint’s 1,000 phone retail outlets. Other distribution channels will be announced later, as will pricing and date of release.
Finding the right distribution mechanism for the Skiff could prove its toughest challenge. Obviously, the B&N venue would favor its own device, even if it did open itself to multiple vendors. Borders Books retail stores have been featuring the Sony devices for some time. And Skiff has no brand recognition of its own with which to build much of an online draw to an e-commerce site. Relying on a tech provider like Sprint is dubious, since wireless carriers do not have expertise in selling content-centric devices. In fact, content partners to the major carriers have long complained how poorly these tech-driven companies merchandize mobile content.
To make matters worse, all of the e-ink readers are about to be eclipsed by the relentless hype surrounding the rumored release of an Apple tablet, which many expect to be announced later this month.
Nevertheless, the march of the e-reader devices continues, with voice-recognition innovator Ray Kurzweil announcing a new color e-reader, the "Blio," today at CES.
Sit back and watch the fragmentation begin.



Two Out of Three in the US Prefer Print
Posted on November 03, 2009 by Mediabids
From adoperationsonline.com. Full story here
Two out of Three Americans Prefer Print Media In Spite of the Benefits of the Digital Revolution
NEW YORK – According to new research, digital media is no substitute
for traditional printed media. A recent survey conducted by Harris
Interactive® on behalf of Earthtone suggests that most people choose
how they consume media based on personal preferences.
Research shows that the majority of U.S. adults think that printed
media is easier to read than the digital equivalent. Interestingly,
most adults reported that they feel more comfortable when they have
something on paper than when it’s on screen, suggesting that we make an
instinctive association between things we can touch and feel and things
that are ‘real’.
Tagged survey advertising www.mediabids.com print marketplace mediabids sites online ads newspapers web magazines research
Newspaper Websites Unable to Attract Larger Brand Advertisers Consistently
Posted on October 26, 2009 by Mediabids
From today's New York Times comes this story of how newspaper web sites are having trouble attracting larger brand advertisers consistently.The reason boils down to two problems we have spoken about on this blog many times - newspaper sites are too expensive and the ability to target is poor.
Full story here.
Part of the story:
It was a good day for newspaper Web sites when Mercedes-Benz USA introduced its updated E-Class cars this summer. Mercedes bought out the ad space on the home pages of The Washington Post, The Wall Street Journal and The New York Times, and had those sites create special 3-D ads for them, at an estimated cost of $100,000 a site.
The days after were not as good. While Mercedes was happy with the newspaper sites’ performance, it shifted money to cheaper, more tightly aimed ads bought through networks, which bundle ad space from many Web sites.
When Mercedes advertises its more basic models next year, it will largely avoid newspaper Web sites and rely on networks. That lets Mercedes “be very targeted and efficient with our dollars,” said Beth Lange, digital media specialist for Mercedes-Benz USA.
But that also explains why newspaper sites are not holding on to ad dollars, even while overall Internet advertising is creeping back. Newspaper sites are the patent-leather stilettos of the online world: they get used for special occasions, but other shoes get much more daily wear. The beneficiaries of this behavior are networks and exchanges like Advertising.com from AOL and DoubleClick Ad Exchange from Google, which dominate the buying and selling of extra space.
Tagged advertising street www.mediabids.com target wall newspaper websites times site new marketplace mediabids washington york post brand journal audience online
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