There are a few rules of thumb that you should always keep in mind
when you are in the Vertical Ad Network space. These rules should be
used to guide your decisions on where to focus and what is your real
value in the market. Of course there is a counter view to almost every
one of these so called ‘Rules’ but they are there to help vertical
managers in building and operating high quality networks…
Critical mass can equal high CPM’s from big agencies – the more sites you have in a specific category the more valuable you are perceived by brand agencies.
Transparency is critical – in today’s world of expanding user generated content, fragmentation and reduced margins in the agency space, providing 100% transparency to your advertising and publisher partners is crucial to your success.
Long term publisher agreements create exponential value – it has proven itself time after time where a network locks-up high quality inventory within a specific category and they become high value assets overnight. From assigning traffic to having true exclusive rights to some of the highest quality tail sites on the web provides exponential value to all of the endemic and large fortune 500 advertisers in the market.
Vertical Networks in highly sought after niches like auto and travel can create a vacuum of available ad inventory – this effect actually drives the prices up and can have an interesting effect on overall demand by advertisers to lock-up their buys earlier.
90% of blogs and websites will never have a dedicated sales team
– though these sites are highly valuable to advertisers it is crucial
to realize that it is near to impossible for agencies to work directly
with these sites. Your network will facilitate this marketplace, while
also establishing a more effective channel for selling.
If you don't have a sales force, don't build a network
– you can get away with building a network with
almost nothing these
days, but it is absolutely critical to bring a sales force to the
table.
Your primary value to the marketplace is to facilitate and evangelize the network and network sties.
Don’t forget overseas – the inventory you are locking up as you build your network is actually valuable overseas also. If it isn’t your top priority, it should be in your top five, to focus on selling and/or merchandising international traffic.
Service and Respect to your publisher partners is worth its weight in gold – time and time again there are stories out in the blogosphere about sites that decided to keep an advertising relationship because of the level of service and support their revived from their network partner. Never underestimate what drives bloggers and website publishers, especially the smaller niche players
Publishers are skeptical – like clockwork as you are working with publishers they are on the lookout for what the risk is and what you are trying to trick them into doing. Transparency and honesty are critical early in the relationship.
Control is Critical – don’t think you are going to be able to build a high-quality ad network without providing 100% control over the sites in your network. Sites need to retain the rights over pricing, remnant, ad creative, syndicated Content, and ad placements on their sites.
You can never really be 'Sold Out' in a network – one nice thing about having a network in a vertical is there are over 88 million active websites out there. Even in the most specific categories possible, there is always another site coming online or potential blogger picking up traffic. If you sell a campaign and are worried that it was oversold, you can very easily go out and retain additional ad impressions.
Cash is King, but not the only driver for publishers – as we have pointed out in the past, the money is a critical component to the network. Remember the three motivators for publishers: revenue, recognition, and traffic/visitors (aka money, fame and power).
Focus and Stay on Target – just as the x-wing fighter pilot said in Star Wars IV, The New Hope, it is absolutely critical for you to stay on target. Yes, you will hear in the market how advertisers are looking for many different ways to buy and target different audiences, but drifting away from your target is only going to devalue your overall ad network asset and lower the market price and demand.
These are a few rules of thumb when planning, building, and operating a vertical brand advertising network. Each of them can be fit to your goals and objectives, but overall they are good to use as a guide when operating your vertical ad network.
