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Networks, Networks Everywhere

I love ad networks. I've been a fan since the early days, back when DoubleClick still sold media and N2K would allow you to buy MusicBoulevard.com on its own or as part of a "music category" buy.

I love ad networks. Every few months I write something about them. I talk about the variety of ways they can be used. In this very space I've talked about how networks can be used in a lot of different ways, from extending incremental reach to acting as "fill" for a schedule. However, the kind of reach I've talked about isn't simply demographic reach, but extending psychographic reach. Networks can essentially play the role of what I like to call "psychographic spot fill" to an overall online media campaign.

I love ad networks. You can have your ads run in some great properties and, more importantly, reach great audiences. And it won't cost you too much.

Up through the year 2000, ad networks were plentiful. There seemed to be a new one every day.  Near the end of that year, several had morphed into seriously discounted media providers. By the following year, only a few ad networks were still viable (e.g., Advertising.com, BURST Media and ValueClick, among a few others).

Now ad networks are back in full swing. And I still love them. They are the best way to get significant reach against both niche and broad targets. Better than Yahoo!, better than Google (Google isn't really a reach play, anyway, it's a DR play), Better than most any site you can think of. If I'm looking for niche audiences, a network -- if it is large enough -- can aggregate enough of the smaller "passion places" (sites with very specific appeal) to create a big enough audience to give me scale against the audience I'm looking for. If I'm looking for a broad target, well… oxygen breathers can be reached just about anywhere, so why pay the premium with a cherry-picked branded content site?

I love ad networks.
But there are now dozens -- maybe even hundreds! -- of ad networks in the marketplace. I don't want to list them all here for risk of being remiss in mentioning one of them and raising the ire of their respective PR departments.

With interest in online advertising coming from all sides of the marketplace at a level that rivals -- if not outright surpasses -- the interest of the late 90s, the online advertising marketplace seems to be open once again for just about anyone with the wherewithal to make a go of it.

But enthusiasm to spend online doesn't mean that all places become viable vehicles for advertising. Just how many ad networks can the marketplace bear?

As most of you know, networks work in ostensibly two ways: they either have exclusive rights to sell advertising on behalf of the sites within their network or they are one of many channels of inventory sales distribution, essentially competing with each other to sell the same inventory on behalf of a given site. The network in the latter case is more often than not "blind" to the media buy, meaning that one might buy ROS or a content category without knowing which sites are actually included.

The reason inventory ends up in that latter kind of network is for one of two reasons: the sites cannot afford the resources necessary to sell their own inventory, or the sites have inventory that outstrips the capacity of said site's sales resources.

The web's worst kept secret is that even the most popular sites have more inventory than they can sell. Certainly, the allergy sufferer's page on site XYZ.com will sell out regularly; the rest of that site has plenty of inventories that aren't moving. And so it either runs as bonus, a make good or ends up in a network.

But how many of these resellers can exist in the marketplace? At some point, the duplication in the representation -- blind or otherwise -- of a site's inventory is going to result in a negative yield curve for the advertiser. If as an advertiser I'm making a reach play, I risk burning out an audience with too much frequency even if the buy made was with multiple vendors. If as an advertiser I'm making a DR play, I risk wasting multiple exposures against too many disinterested members of the audience.

I love ad networks. But too much of a good thing can be bad.

Media Strategies Editor Jim Meskauskas is vice president and director of online media for ICON International, Inc., an Omnicom Company. Read full bio.

Jim Meskauskas is a Partner and Co-Founder of Media Darwin, Inc., providing comprehensive media strategy and planning.  Prior to that, Jim was the SVP of Online Media at ICON International, an Omnicom Company, where he spent nearly five years.

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