As VP & General Manager of Advertiser and Agency Solutions at DoubleClick, Knopper is immersed in the online ad industry, in tune with its barriers as well as growth.

In an industry that has been around less than a decade, and that already has gone through a major crash and fall-out, there are very few veteran companies. However, DoubleClick would qualify, having been established in 1996. Not only did the company survive the hard times, it has thrived and today is thought of as an industry leader.

Doug Knopper serves as Vice President and General Manager of Advertiser and Agency Solutions at DoubleClick. In this role he is responsible for the business and product development for DoubleClick's portfolio of advertiser and agency solutions including the DART for Advertisers service, MediaVisor planning tool and Site Directory listing service. Knopper also has an agency background, as well as knowledge and experience in the research arena. iMedia Connection talked with Knopper about the state of the industry and his current initiatives.

iMedia Connection: How would you describe the current state of the industry?

Knopper: It feels like a little bit of optimism has been seeping back into discussions. In terms of the economic stability of the industry, there's a feeling that we've seen the worst of the bad times and so a lot of the companies out there are feeling like the current market is now at steady state. What I've been hearing is that people feel like they survived the most painful period that any industry can go through and if they've survived it, any kind of turnaround would be beneficial.

In terms of the overall business of online marketing, there are still some incredible challenges we have to face. There's an overall need to make online marketing more efficient and more effective; to do the right things and to do things right. The good news is there are a lot of people and a lot companies, including DoubleClick, that are making great strides at doing that and the real good news is that once we do solve a lot of these thorny problems, we'll be in a position in which our strength as a medium will rival the offline media.

iMedia Connection: What are some of the specific challenges that are barriers for growth?

Knopper: We have to make the process easier for marketers. Agencies admitthey spend an incredible amount of time -- sometimes more than 1/3 of their billing time – on non-value add efforts: faxing, sending out insertion orders, and managing just the process of online advertising. And we have to get the cost structure in-line. We still haven't figured out how to make the process of online marketing profitable for agencies and results oriented for marketers. The costs are high, the work effort is high but the dollar revenue is not high. So it's a lot less painful and a lot more profitable for an agency to do a $4 million television buy at a 2% agency commission than a $100,000 online advertising buy even at a 10% commission rate. Until we get the economics in balance we're going to struggle in this industry for agencies to make a profit and for publishers to make it worth their while.

That all being said, I think we've made great strides in the past 12 to 18 months. There are a lot of tools out there -- like DoubleClick's MediaVisor -- that are making the process more efficient.

And there is a lot of work toward proving the medium's effectiveness. The IAB has done studies, the OPA has done studies, DoubleClick has done studies on branding and e-mail effectiveness. I think everybody is working toward getting that knowledge so marketers can have a better understanding of what the medium can do.

So frankly, I'm pretty optimistic on what I've seen happen in the last year.

iMedia Connection: Where's the most growth coming from? A certain sector? A particular type of advertising?

Knopper: Clearly, over the last 12 months, much of the growth has come in the e-mail space. Our DARTmail product has been a beneficiary of that.

When you look at it from an industry side of things, what we’re seeing is two things happening in the marketplace. One is an increased willingness at the brand level to spend a little money in online. And we're also seeing some industry verticals that have been pretty aggressive in moving some of their marketing spend toward online. Specifically the automotive, travel, financial services, a little bit of retail.

We're particularly encouraged, too, by what we see in the CPG world. DoubleClick just did a study with IRI that found that online advertising has great impact both in terms of brand impact and offline sales growth. There was also the IAB study on marketing mix that showed good gains for CPGs.

iMedia Connection: What's fueling the growth? More trust because of the studies? More rich media? Or a combination of several factors?

Knopper: It's a combination. Some of it is simply level of comfort. It's almost a generational thing. Media planners that started out five years ago and understood the Internet are now moving into positions of more influence and more authority within their organizations, both at agencies and brand marketers. And they're having more say over how dollars are spent. And that is a trend that certainly will continue over time. That was the case with cable television and I'm sure that was the case with television long ago. New mediums take time to grow and to learn and to understand. So that's kind of a long-term shift that's fueling growth.

In the short term, I think there's an increased level of comfort and acceptance in the metrics and the research that we're seeing. The research studies that have come out over the past year have been pretty persuasive. Those studies go a long way toward reducing the skepticism. I'll give you an example on that. We're about to announce some media delivery reports within our DART for Advertisers ad serving which are designed to give an advertiser or agency the ability to understand their campaign and delivery according to their booked impressions compared to actual delivery. That's the kind of thing that's a given in the offline world but has never been available in the online world. It's just one of many new innovations that we and others in the industry are offering.

iMedia Connection: How have the new larger ad formats affected the business?

Knopper: The ad formats have had considerable effect. In terms of rich media overall, we all know that it has been adopted quite successfully. Twenty percent of all ads served through DoubleClick's DART system are now rich media. And in terms of effectiveness of those, while this is not the end-all, be-all of statistics, it is telling: Rich media has click-through rates six times higher than an average banner ad.

So there's no question those ads are being adopted and having more impact. Whether that holds up over time remains to be seen. For example, if they get overused and the end users become irritated or annoyed, that can have a real negative effect. But rich media or larger ad formats are definitely more visually stimulating formats and so are must-haves for the industry.

iMedia Connection: Any favorite campaigns you can talk about or any company you see doing a good job in terms of interactive?

Knopper: Ford Motor Company is doing a very good job. That's a marketer that is willing to test some boundaries and at the same time maintain advertising continuity. They are doing some groundbreaking things, such has having the Ford Explorer drive across your screen. We work pretty closely with Ford in providing tools to plan its campaign. I think that they are a good user of interactive, in terms of testing and trying new solutions.

iMedia Connection: Where is DoubleClick right now in terms of profiling? What's the future of this practice, industry wide?

Knopper: DoubleClick has done a lot in the space of what we call Intelligent Targeting, which is essentially the ability to target your media based on lifestyle groups, or interest groups. We spent a lot of time and energy and resources in developing those tools. What we found, though, is that these tools carry premium pricing and there was not huge demand for them in this media market. If and when that demand comes, we stand prepared to offer that. We also have found that very narrow targeting that we can offer through the ad-serving technology is something that few of our customers actually adopt. For instance, targeting by geographic using the ad server is used by only 5% of our customer base. Time of day, which we think would have great value, is used by like 2% of the customer base. So a lot of people see the promise of very narrow and precise targeting, but I don't think that in actuality we have seen the payoff yet.

iMedia Connection: How is DoubleClick addressing the Reach/Frequency issue?

Knopper: Reach/Frequency is actually a very, very interesting and complex subject and we have many solutions already available. First, through the DART system, we offer many different kinds of Reach and Frequency reports. Reach by site, incremental reach by site, incremental reach for each campaign, are all reports available via the DFA ad-serving component on an actuals basis. In terms of pre-planning, which is where the interest and controversy lies right now, there's a lot that needs to be done on that both from an industry standpoint and from an individual company standpoint. And it requires a combination of three things. It requires panel-based information from NetRatings or MediaMetrix, it requires server-side information from DoubleClick, and it requires fairly complex mathematical statistical modeling. In order to get that it's going to require an industry solution.

There's actually a fourth component to it: That's being able to marry up offline media planning data with online data in order to allow online's place in the overall media mix. That requires another whole set of data which no player in the online space currently has access to. So it really requires a complex set of data and a complex set of calculations.

iMedia Connection: What is your perspective on the Internet being a branding tool vs. a direct marketing medium?

Knopper: To me, it's all about what the marketers' objectives are. An ad in the Superbowl is about branding -- getting awareness up, getting a message delivered. But ads in late-night television sell product directly without interest in awareness or favorability. So I think television is a dual medium, I think newspapers are a dual medium, I think magazines are a dual medium and I think the Internet is exactly the same. I think the Internet has the possibility to be an incredibly effective direct-response channel, both because of the targeting a marketer can do because of the low-cost for the medium and because of the high impressions they can get. But it can be equally effective as a branding medium if that's what marketers' objectives are.

However, talking about direct-response advertisers --- advanced direct-response marketers – they are really looking at efficiency and effectiveness to the highest degree. They are calculating their return on investment on every possible thing they can do. And there's a whole series of tools out there that those marketers are looking for that can help them take their marketing campaigns to an even further level. DART for Advertisers is now offering automatic creative optimization which is going to be a very big, important feature for those advanced direct marketers.

iMedia Connection: What are most of your efforts focused on right now?

Knopper: Making the overall process work more efficiently by creating a true end-to-end solution. There are a lot of moving parts and moving pieces in this industry in planning and buying and executing and analyzing and billing an online campaign. When you start to think about all of the things that go into that process -- site research, audience research, true media planning where you're comparing the efficiency of one site vs. the efficiency of another site -- the actual process of buying, executing the campaign and delivering it, analyzing and optimizing it, and then ultimately managing the billing and the invoicing for it, it's incredibly complex, and then you can add in customized optimization solutions, customized CRM solutions, things like that, it's incredibly difficult to do.

I'm spending a lot of time on coming up with one end-to-end tool set that will give marketers the basics to do all of those things and will allow them links to things that are either proprietary or very specialized that other companies would offer. So for example, our MediaVisor tool, which is our workflow tool, enables marketers to link to our partner, Net Ratings, for research. Our DART for Advertisers, or DFA, tool will link to some of our other partners like Dynamic Logic so marketers can do brand impact studies using our ad server.

And then you might have read recently that we just announced SiteAdvance, which is a site analytics tool and probably one of the most powerful tools out there to really understand what's happening on your site from a marketer perspective. And that will link with DFA and with DART Mail.

It's all about execution now. We all have these pieces. I was just talking with a publisher client today and he said, "I work with 40 different vendors, it's difficult for me to execute with all these pieces." So we're trying to supply the platform that allows a marketer to have one tool set that works with any vendor.