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DIY ad networks: 5 steps to the perfect platform

DIY ad networks: 5 steps to the perfect platform Scott Swanson

So you find yourself on the "hate" side of the ad network love/hate debate (or should we say, debacle?).

It could be because you are a fairly small, single domain publisher that doesn't have the traffic to attract large advertisers, and you hate being dependent on ad networks to bring in the big brands.

Maybe you're slightly larger, with several web properties, but you can't sell all of your inventory, so you have to unload your remnants at jaw-droppingly low CPMs. Or perhaps you're a media giant, and you're seeing your dedicated ad ops team be one-upped by ad network reps promising the world (i.e., targeting) to data-thirsty media buyers.

Whatever the scenario, we're hoping you've channeled your anger into a constructive decision -- that is, to build your own network.

Say what you will about the ad network industry and its many players, but the truth is this: The ad network arbitrage model works. If you have the opportunity, why not beat them at their own game? You'll not only expand your inventory and audience reach, thus increasing the value of your ad offerings, but you'll also gain a better understanding of your media assets and have the control to automate and optimize large-scale buys -- a key part of scaling any digital business.

The steps to building your own vertical ad network are fairly straightforward. However, business development and ad operations executives often hit a big bump in this roadmap to growth when it comes time to select a network management platform.

It certainly can be confusing: In the past year, the number of platforms available for licensed use has nearly doubled, and there are now more than a dozen choices in the market. They range from Cox-backed Adify's Network Builder to the so-new-it's-not-even-on-the-website Partner360 product from Operative. And then, of course, there is the April 2009 release of Doubleclick's Network Builder (DNB), built on the Google DART for Publishers system.

How do you find the best network management platform for your needs? Here is a five-step approach:

Anticipate the needs of both your company and your publisher partners
To maximize yield of your newly expanded inventory, you'll want your network management system to provide sophisticated levels of targeting, inventory forecasting, and top-level insights. You may also want the platform to handle billing -- that is, publisher payouts.

But you're no longer a one-man show; the new publisher partners are likely going to want tools for targeting, tracking, and reporting, too. They may also require extra features like ad blocking and video ad serving compatibility. Take this laundry list of necessary features with you when you start comparison shopping.

Do a wide sweep of available platforms
As noted above, the space is growing fast, and there are new vendors popping up literally every month. Don't assume that you know what's out there, because it's changing every day. We keep an updated shortlist of recommended platform providers on our website; that's a good place to start. But you can also trust your own research skills and tap into your professional network to find out about any new players that you should take into consideration.

Try them out
You can't know if you'll like a technology solution unless you've taken it for a test drive. Contact sales reps for some of the platforms that sparked your interest and ask for demo accounts. You can be as objective as you want about feature sets and integration capabilities, but at the end of the day, you want the network technology platform to just feel right. Think about the hordes of B2B professionals out there that are frustrated by the usability of their CRM platforms. Now avoid that situation by giving your ad operations team the best network management dashboard out there, specifically for their needs and preferences.

While you are in the trial process, also take the opportunity to ask each vendor to explain in detail the targeting and management functionality of its system as well as its technical infrastructure, implementation, processes, and pricing structure. The more information you get, the better.

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Rate your choices
Whip out a spreadsheet program and make a chart, assigning vendors quality scores for each of the following criteria:

  • Turnkey integration with current workflow. Choosing a network technology platform that is compatible with present operations can be a big advantage because you won't interrupt your workflow and have to start over from scratch. Some network technology platforms actually work as APIs to existing ad servers. For example, if you are already using DART for Publishers as an ad server, you can keep doing so, and just "bolt on" Collective Media's AMP platform.

  • How well it matches up with your anticipated needs. (See Step 1.)

  • Feature set and extra perks. In a way, this corresponds with knowing what you're going to need in a technology platform. But you can't always predict this. Take the big shift that we're seeing toward targeting technologies. One of our clients was able to add a layer of data targeting to attract advertisers that previously had never paid attention to them. Another feature of interest now is reach extension. If your network doesn't provide enough audience for an advertiser, you'll want the ability tap into other resources -- be it an ad exchange or a larger network -- to extend your overall reach.

  • Company standing. As with any technology partner, longevity is an important element when making your choice. You'll be building systems and processes on top of this platform, so it is essential that your partner have the stability to warrant a long-term commitment. You'll want to make sure that the company is going to dedicate resources to improving its platform over time, and continue to innovate with its product. Selecting a company with a good reputation will also make publisher partners feel more comfortable with the system when they interact with it.

  • Price. Ah, the golden criteria. Pricing for platforms fall into two buckets: CPM, which is based on gross impressions delivered, and revenue share, based on a percentage of revenue booked in the system. We generally recommend a CPM pricing model for licensing a technology solution; revenue share pricing would only be optimal for networks that do not anticipate selling at rate card CPMs of $5 or higher.

Pick the winner
Use a combination of the chart's findings, your feelings from the test drive, and recommendations from experts in the industry who have experience with various platforms.

After you've made your choice, it's time to negotiate and finalize the deal. First, ask for different pricing models. Tiered pricing models lower your price based on volume, which may make a lot of sense if you are going to be in that upper echelon of transaction volume.

You might also factor in your company's value as a client to that vendor. Will they issue a press release to leverage your brand and reach new clients? If so, you've got some wiggle room.

Finally, be patient. In our experience, we've found that sales reps are very patient. They recognize your need to do your homework before jumping into a contract with them, and know that if you make an educated decision, you'll be more likely to make a long-term commitment. You're well worth the wait.

Scott Swanson is a founder and principal at 47 Media.

On Twitter? Follow 47 Media at @47media. Follow iMedia Connection at @iMediaTweet.

Scott Swanson is CEO and co-founder of Aki Technologies (www.a.ki), the first ad platform built for mobile moment targeting and insights. A pioneer in mobile advertising, Scott previously founded Mobile Theory, one of the industry’s most...

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