OK…so maybe it’s Online Advertising 3.0….or at least 2.5… but one thing is for certain: Social Networks are riding a wave of attention for the role they may well play in the next evolution in online advertising.
In more than one industry-related conversation I have heard expressions like, “Social networks are the Wild West of online advertising,” … or, “It’s hard to predict what role social networks will have in the coming online evolution.”… or, most surprising to us, here at CPX, “Ad networks just aren’t ready to deliver social network monetization yet…”
But the truth is…none of these could be further from the truth…
- “Social networks are the Wild West of online advertising,”Calling something the “Wild West” of anything generally means that the thing spoken of is “out of control” or somehow “beyond order and expectation.” But, just as Social Networks (and other user-generated content sites) are the natural extension of the Internet, so are their affects on online advertising the very natural extensions of this hotter-than-ever digital space.
Every time someone creates a MySpace page, or posts another video on a user generated content site, or posts their response in a forum, they have created another “piece of real estate,” another targeted opportunity for advertisers to reach their desired audiences. While a magazine cannot ad an infinite number of pages, and a television show cannot contain an infinite number of commercial spots, there are really no limits to how many “impressions deep” a website publisher can monetize…so long as there is a supply of advertisers ready to pay a reasonable price for the inventory and a market in which the two parties can interact. The rapid rate of Social Network (and related) websites naturally means a related rapid growth in these “deep-level” advertising opportunities. For an advertiser that both understands the potential value of these opportunities – and aligns itself with a company ready to capitalize on those opportunities – there is no reason for this development to feel either “out of control” or “beyond order and expectation.”
- “It’s hard to predict what role social networks will have in the coming online advertising evolution.”The thing is…it’s really not that hard…. As discussed above, the growth of Social Networks means larger and larger supply of deeper and deeper site impressions. Current industry nomenclature calls these deeper impressions “non-premium,” or “remnant,” inventory and, while they clearly have a discernable value, they are considered less valuable than “first impression,” or “premium,” inventory. (The belief that it was a PR mistake for the online industry to allow these pejorative sounding classifications to stick is a topic for another discussion.) So the role these Social Networks are playing is clear… they are creating unprecedented liquidity and opportunity in the online adverting market.
- “Ad networks just aren’t ready to deliver social network monetization yet…”It is true that, as these “lower value” impressions proliferate far faster than their “premium” counter parts, many stalwarts of the online advertising industry (and many ad networks, specifically) have been slow to accept them as the new truth they represent.
But don’t tell that to the many CPX Interactive clients that are leveraging the network’s ability to deliver this “non-premium” inventory in efficiently priced campaigns with incredible reach. CPX’s proprietary process includes arbitraging this non-premium inventory, conducting targeted traffic analysis, developing and honing specific conversion-focused creative, and parlaying years of historical data and learning into dynamically optimized performance-based campaigns that maximize pricing efficiency for both publishers and advertisers.
And, while CPX Interactive may be one of the largest ad networks to proactively monetize 100% of our publishers’ inventories (including both “premium” and “non-premium”), with the growing acceptance of the exchange model (CPX has embraced this model from the beginning) and the undeniable surge in “remnant” publisher inventory, progressive ad networks are sure to understand that – far from being an anomaly that can be ignored – Social Networks and other Web 2.0 sites are actually defining the landscape that may well become known as Online Adverting 2.0.
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