What’s Up With These Ad Exchanges?

Double Click announced a bid-driven ad marketplace a few weeks ago.  Today, Yahoo said it was buying the rest of Right Media.  As we all know, Google in March revealed its commitment to an auction approach to Cost Per Action.  Big players clearly see some value in bringing buyers and sellers together for online display ads.  Is this the future?

I’d say it is at least part of the future for CPL and CPA.  A successful exchange requires transparency and measurement standards.  In the equities markets, the former means quarterly reports and10K’s, and the latter means agreement to evaluate stocks on earnings or revenue. 

But in the world of performance advertising, there’s a real risk of “apples and oranges”.  How can an exchange equate the value of a sale versus a newsletter sign-up versus a webinar attendee?  It will be fascinating to see how these exchanges approach the multitude of possible actions.  In the meantime, there’s real value in standardizing programs for niche advertiser needs.  I’d appreciate any thoughts on how the evolution to exchanges might happen.

Comments

[peter caputa]

You pose great questions, Gary. I've played around with RightMedia as a publisher. So, I am not familiar with their targeting capabilties (or their ability to let 3rd party networks target by demographics/behavior/contextually). I am sure Pat McCarthy or Greg Yardley would be able to answer that better. I'll send them this post.

It looks like you guys at Precision Prospects place ads on publishers sites and see what converts better. Is that right? So, you're able to target ads based on historical performance? I am guessing we'll see a shift to more dynamic pricing via exchanges when they can provide tools to advertisers that help them target their campaigns and track performance by campaign.

I can't imagine that CPL and CPA advertisers will want to report back success. Of course, that is the route that Turn.com seems to be taking.

[Pat McCarthy]

Hi Guys,

The different type of leads are all basically evaluated back to the eCPM they generate for publishers.

So, a newsletter signup may be something an advertiser pays $2 a signup for, while a conversion to Netflix may be $70.

All the advertisers using our exchange do have to report back conversions using our exchange pixel (or we can piggyback off of other pixels).

By using the conversion data and amount paid to publishers we can convert all CPA offers to effective CPMs. So it does end up making everything apples to apples regarding the different types of pricing we allow and different types of conversions and goals that exist out there.

[Sonia Roody]

Ad exchange plays great role for gaining sales. Aside from gaining sales, most entrepreneurs focus also on improving their business products and/or services in order to give satisfaction to their clients, and maintain their accounts. These became a reason they hire services from a call center for managing their concerns of their clients.

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