Monday, January 24, 2005

An embarrassment of dot spots

The report of a shortage of online ad inventory is greatly exaggerated.

A lack of space to accommodate eager online advertisers was cited by the New York Times as the reason why four media goliaths bid up the price of CBS-MarketWatch, which joins the Dow Jones fold this week after notching a $520 million payday.

While it may be true that DJ and other establishment media companies think that they are facing a shortage of dot-com spots, their fear represents a profound misunderstanding of this Internet thing.

Yes, Virginia, there is a limit to the number of ads that can be pooped -- I meant to say "popped" but the Freudian typo was too good to fix -- over, under and next to the first page of any big-name website.

But the nuggets of gold at the end of the cyber-rainbow are the countless unexploited advertising opportunities available at all the wondrously segmented web sites and blogs that focus on everything from digital photography and rogue taxidermy to Linux and school menus in Gaffney, SC.

These "boutique" sites may appeal to comparatively small audiences, but they make up in passion and loyalty what they lack in aggregate eyeballs. Significantly for advertisers, the sites deliver self-selected, pre-qualified blocs of consumers who fit a predictable and largely homogeneous profile.

Connect advertisers with the avid readers/shoppers at these disparate destinations, and watch online advertising breeze past the back-to-back 20% gains projected for last year and this one. Of nearly $10 billion in online ads sales in the US last year, more than 40% were direct-response ads linked to keyword searches on Google, Overture and similar services.

New kinds of ad ops with the same characteristics as keyword search -- easy categorization, efficient insertion and pay-for performance pricing -- will create an limitless inventory of advertising on the Internet, on podcasts and over cellphones. Beyond key-word search -- not that there's anything wrong with it -- new formats that come to mind include blog ads, RSS ads, coupons and try-to-buy programs. Anyone out there got any other thoughts? Please comment.

Meantime, feel free to sell all the dot-spots you want. We'll make more.


Anonymous Anonymous said...

Nice post!

6:36 AM  

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