(I start this post by disclosing that I do realize that I am dating myself and may even sound like an ol’ crotchety Internet executive)

As an internet executive who has been around long enough to see the ups and downs of internet business including “dot bomb” and the stock market plunge of agencies and stuck with it to see the rebirth of the internet in Web 2.0, I ask my Web 2.0 marketing and business posse this…Have we not learned anything from Web 1.0?

If we are truly a learning environment filled with Wikis, social networking and smarter spending habits, why are we not leveraging consumer buying power to its fullest?

In Web 1.0, companies failed because they were not fiscally responsible and they continuously gave away products, services and their audiences for free, even though consumers were willing to pay. It just did not work.

In Web 1.0, we found that there could not be free services, no free drives and more importantly no free entertainment. What makes interactive “professionals” of the Web 2.0 revolution think that free video can exist without advertising?

Has someone found a business model that allows companies to barter our products and services and then barter with the Internet service providers and electric company to keep our services running?

I want to begin seeing video sites that leverage distribution models that actually generate dollars for advertisers creating the content and publishers selling the space where the content and consumers are living.

I think we can all glean learnings from the mobile marketing space. The mobile marketing industry is making money! They charge nominal fees to consumers to access branded ring tones, videos and music, therefore making a viable business.

If you are going to offer free content, consumers are willing to sit though 10 seconds of ads to get what they want. Just as they have in the early days of radio, television and the current iterations of music sites, consumers will wait and get great entertainment at the nominial cost of their time. Consumers have shown us time and time again that if the content is good, relevant or worthy of distribution they will pay for it in an “on demand” model. Can you imagine getting an on demand video service without out a subscription to a local cable company? (I think that is referred to as Cable piracy)

While it is not the only way, it is a sure fire way to keep the lights on and employees fed. What I predict is a quick evolution from Web 2.0 to Web 2.0. 1.21, which will help agencies define the Pre-roll space, feed the starving creative mavens producing video content for the web and more importantly separate the girls from the women in this market place.

What are your thoughts???

In my quest to develop a panel of incredibly savvy movers and shakers from all facets of the interactive agency world, I am spearheading a digital marketing consortium. The consortium members will meet quarterly to discuss moving the needle for their clients in the areas of interactive websites, media planning / buying and content distribution.

The national agency consortium will discuss how smart interactive strategies combined with the right media exchange buying model can move big brand clients from old school buying models to passion building experiences that yield actionable data on consumers that interact with their programs.

To get more information or join “The Agency Consortium” email me at jpena-bickley@rightmedia.com.

Mediapost published an update on the plans of an advertiser task force, championed by Julie Roehm of Wal-Mart, to test an eBay-like auction marketplace for buying and selling tv ad space. The article focuses a lot of attention on network resistance to the idea, based on the belief that an exchange commoditizes their inventory.

The article states:

In May, the President-COO of NBC Universal’s television operations, Randy Falco, was even more definitive in his opposition to the proposal. “That’s ridiculous,” he said. “We’ll never do that. That commoditizes your product.”

The counter-point is presented in the article as well:

A top executive at the AAAA’s with ties to the task force said that he is hopeful the networks will reverse some of their initial opposition and opt to eventually participate. Michael Donahue, AAAA’s executive vice president, said the online auction could be a way for networks to boost revenue for lower-tier inventory. “Would I expect a network to put up a ‘CSI’ spot for auction? No,” he said. “I don’t think they need to sell it that way—and frankly, I don’t think the advertisers want to buy it that way. Is it possible they’d want to put up a 3-rated spot on a summertime re-run and maybe hope that they get a better rate than by selling it in scatter in the summer? They might want to do that—who knows?”

This is the one issue that will have the greatest impact on the future of exchanges for advertising. Will publishers be able to get over the fear of commoditization that goes hand in hand with exchanges? We hear this all the time: “Won’t participating in an exchange cannibalize my brand sales efforts and make it impossible to get advertisers to pay rate-card? If I allow any of my ad space to be commoditized, won’t it all become a commodity?”

Publishers are right to ask the question, and right to be wary. I may be a bit of a black sheep amongst exchange advocates, but a great deal of advertising inventory is not appropriate for sale through an exchange today, and may never be.

Yahoo should not be selling its home page or premium positions throughout its network via an auction, nor should The New York Times. Martin Nisenholtz, CEO of NYT Digital, said the following to me in a recent conversation: “There is something magical about a brand. That is a lot of what advertisers value. If we allow our inventory to be sold in an auction, don’t we risk destroying that magic by commoditizing the brand?”

Martin is right—there is magic in brands, and that magic needs to be protected. For many advertisers, that magic is the brands they associate their brands with. After all, how can Proctor and Gamble believe in the power of the Crest brand, but not believe in the power of the brands they associate with Crest? To these advertisers who buy based on brand value, a media auction is an utterly foreign concept.

On the other hand, there are many advertisers out there—spending huge amounts of money—who don’t think that brand magic is important. They believe in data and response metrics. They buy based on analytics, not based on the perceived value of a brand. There’s little that any publisher can do to convince these marketers to buy premium positions based on brand value. They simply don’t buy that way. To these advertisers, a media auction feels like Nirvana.

So how do publishers use exchange dynamics—which they know will make them more money on inventory they can’t sell at a premium—to sell to response-driven advertisers, without compromising their ability to sell premium to brand-focused advertisers? The answer is elusively simple: as long as a publisher creates a clear and consistent distinction between that which is “premium” and that which is “commodity,” the risk disappears.

Brand advertisers buy premium positions. They commit a budget, get delivery guarantees, and often receive other benefits such as first right of refusal and exclusivity. They get granular vision into exactly where their ads run. Premium targeting may be used such as demographic or behavioral segments.

Response driven advertisers tend to buy bulk positions, based on metrics such as cost-per-click, lead or sale. They’re usually comfortable buying without delivery guarantees, without vision into exactly where their ads will show up, without exclusivity or right of refusal.

In short, brand advertisers and response advertisers buy different ad products. Most large publishers just need to create that distinct product offering for response-driven advertisers, instead of sending non-premium inventory to ad networks or running house ads. The most efficient strategy is an open media exchange, where buyers can comfortably bid for inventory and each impression is auctioned in real-time to the highest bidder.

That distinct solution will ensure that publishers sell anything they don’t sell at a premium for as much money as possible, while never compromising the magic of a brand.

Ok. You’ve read here and there in our blog that RMX Direct’s peeps are, well, energized and competitive.

So, a while before–when we had just flipped the switch for RMX Direct for Publishers–we saw things moving, and moving up some more…so we set ourselves a goal.

1 billion impressions by a certain date…and we’re closing in on it.

How much is 1 billion? Ok, I could Wikipedia the number or Google it and get a fun fact: ‘enough pennies to cover the Pacific ocean’s surface, stacked up 100 each’…or something like that. That’s for you to do–you’re web savvy if you’re reading this blog, right? Thought so.

Well, let’s just say we’re on track for that goal.

(cue the Dr. Evil inflection, pinky to corner of mouth…)

‘’One Billlllllyun…imprehshhhhhunnnnsss.'’

In just the last two days, we almost doubled our total impressions and are close to (if we haven’t already surpassed it) 400 million impressions! The words ‘geometric growth’ are sweet to our ears. That is a lot of eyes watching a lot of ads–and a lot of web publishers earning some fine revenue. And this is just our RMX Direct for Publishers, the non-enterprise solution for medium-sized to small-sized publishers. Wow. I don’t usually take pause during my blog posts…

…but this one earned a pregnant pause from me.

We’re about to deliver our baby, RMX Direct for Publishers, out of Beta. Our little RMXD is growing.

So, you’ve got a shop and you sell…let’s say coffee.

Hey, let’s say it’s in Brooklyn, New York. And well, you never really know what people think of your coffee. They could be grinning and dribbling as they bite into that yummy danish along with sips of the organic roasted Arabica blend…and you can guess that they’re telling you the truth to your face when they talk to you. If you could only have some way to read their mind, overhear their conversations.
But it’s hard with coffee.

Easier with the web, though: click and mortar , baby.

In the web world, we have forums.

(Ok–coffee forums exist ,too, but there’s a significantly larger and older group of web-related talking going on. And if you don’t believe me, do a search on Google Trends –I dare you. See, I told you so.)

So, here’s a few tidbits we’ve heard recently from a forum that serves the more agnostic online advertising niches. These members aren’t converted yet to the RMX Direct for Publisher’s approach or the RMX paradigm per se, but we’re watching:

Example:

The question posed (shortened and paraphrased):
Can somebody recommend a good CPM network for my site–I run 120×600 ads…I get a lot of page views. [fill-in-the-blank non-RMX Direct network] didn’t accept my site…is there one that will? Help me!

Some of the answers back to him from his compadres–no RMX Direct charlatans here, people…just web publishers who are getting it:

Web person A:
“What you should do is for your defaults, sign up for the Right Media Direct beta thing [vp-he meant Right Media Exchange Direct]. That way you can get the best possible rates from Yield Manager networks, I’ve consistently averaged over .09 CPM and ensure no wasted ads.”

Web person B:
“…I would try out RMX-Direct as well as that lets you be part of 6 [vp-actually 8 networks in RMX Direct–and there are more in line to join] networks combined at the moment (including CPX).”

Pat McCarthy actually found it and sent the link to us in an email with the simple subject line: “forum people are getting it”.

You know what? They are.

We actually have our own ‘members only’ internal forum for RMX Direct for Publishers users–we post items from them on our blog here at times. They like us but they are demanding–so we appease them readily because they are the OKYAKUSAMA. One conversation recently went back and forth about CPM, other advertisers, etc. Then, while we usually go in and make a post to clarify things, a heroic ‘Steve H’ posted a defense of us. It really changed the mood of the thread and people backed-down a bit. This quote kind of speaks to how it ended as of Thursday afternoon of last week:

“Everything I am making with RMXD is gravy.”
‘Steve H’ -RMX Direct Forums

Now, people cherish their opinions and they passionately back them–the roots of the web are democratic, right? So when we’ve got total strangers starting to talk about us –and they’re doing this on a forum, well…we blush. And we feel cherished as well.

The end of our RMX Direct for Publishers beta is almost over (well, actually we have a date, but we can’t make it public yet. It’s in sight, though, and we’re all chomping at the bit to open the flood gates to all those healthy websites out there who want to join).

We’re giving out free coffee: goooood coffee from the looks of it.
So, check it out before you’re all verklempt and have to wait in line like a schvitzin shmendrek. And we won’t want to hear your kvetshing since we told you so… talk amongst yourselves.

And go here to get a beta invite. Oi.