You may have noticed that we’ve been rolling out a number of products and feature enhancements to help you make sure only creatives you deem appropriate serve to your sites.

We have Creative Tester, Media Guard (in beta), and now Creative Reviewer – our new and improved creative approval workflow.

Before we get to the new features, you might ask, what’s this all about? Why would I want to manually review creatives if I’ve already set up creative content restrictions?

This is a business decision that should be carefully considered because there are costs and benefits to either banning or approving all new creatives by default. (more…)

Mike Seiman is the CEO of CPX Interactive, a member of the Right Media Exchange.

eCPM vs. Total Revenue

While it is true that not all ad networks are created equal…it is also true that any publisher planning to analyze their ad network chains should select their comparison metrics wisely. My hypothesis…and I am always interested in hearing from publishers on their agreement or disagreement…is that most publishers have been trained to look only at the eCPM currently earned on selected inventory — rather than the total revenue they could be making on their entire inventory. If publishers are interested – as I suspect they are – in the total amount of revenue to their bottom line, they would be wise to read on….

In The Beginning

When ad networks first gained popularity, they focused exclusively on publishers’ “premium” placements – those served to only the first few impressions per unique visitor. As the first movers, these early networks (many of whom remain the most commonly known names today) had the luxury of filling only those publisher impressions that would make them the most money per impression. Naturally, publishers where too busy thanking these networks for the ease of “one point entry” inventory management to question if there wasn’t a more advantageous way to deal with their lower-tier impressions…rather than simply sending them to non-paying defaults.

Enter the “Lower-Tier” Networks

Progressive new entries to the growing landscape of ad networks soon realized that there was an opportunity… in fact, a need…for a platform that could monetize the very inventory that the original networks were declining. These networks, because of their ability to convert passed-over inventory into revenue, became known as “lower-tier” networks…delivering value for a publisher’s “lower-tier” inventory. In truth, allowing this moniker to stick was probably a PR mistake. While the term “lower-tier” carries unjust negative connotations…the reality is that these are more accurately described as “100% fill” or “no default” networks.

How They…(We)… Do It

So what’s the magic? How can these networks monetize 100% of a publisher’s inventory…and guarantee no defaults? The answer isn’t so complicated, really. By removing frequency caps and floor CPM restrictions on specific “less desirable” inventory – and then selling this inventory through in a real-time market-driven environment – the real value of this inventory is identified and secured. The market’s Invisible Hand defines maximum value where, before, there was seemingly none.

It was not long before publishers saw the value in this proposition, and enlisted these “100% fill” networks to fill their “lower-tier” inventory….while still leaving their “premium” inventory in the hands of their long standing relationships with higher profile networks. The “premium” networks were happy to default unused inventory to their “100% fill” counterparts, publishers were happy to be getting both their “higher-tier” and “lower-tier” inventory filled…and the “100% fill” networks were happy…for the time being…to have carved out a piece of the pie. But letting this scenario cement itself as the industry norm was likely another PR mistake made by the newcomers….

The Slight of Hand

High profile networks soon realized that their position could easily be in jeopardy if the newcomers started pitching their powerful market-driven platform for selling premium impressions. To reduce the likelihood of this, they cleverly focused publishers’ attention on the coveted metric of eCPM (effective cost per thousand). They would tout their ability to deliver higher eCPMs than the 100% fill networks as a way to scare publishers away from giving the newcomers a chance to deliver the premium inventory. And the truth is that these limited inventory deliverers did have higher eCPMs to show….of course they did…and here’s why:

If network A (a limited inventory delivery network) sells 5,000,000 of your impressions at a $1 CPM and another 5,000,000 at an $.80 CPM…then they have delivered and eCPM of $.90 and paid you $9,000. Meanwhile, if network B (a 100% fill network) delivers the same 5,000,000 impressions at a $1 CPM and the same 5,000,000 impressions at an $.80 CPM…but also delivers another 10,000,000 impressions of your “lower-tier” inventory at a $.50 CPM…then they may have delivered an eCPM of only $.75, but they have paid you $16,500…$7,500 more than the so-called “top-tier” network!

Which network has delivered greater value? Which network truly understands your ROI needs? Which network deserves your inventory management business?

The Misconceptions

Publishers have been trained to believe that “lower-tier networks deliver lower eCPMs.” But the truth is that eCPM is a metric based upon an average. To compare two entities using an average-based metric, you must be comparing apples to apples. Premium and lower-tier inventory are definitely not both apples…though both are found in the same fruit basket. A much better metric for comparing networks is obviously total revenue delivered.

Publishers believe that “lower-tier” networks can only deliver inventory with no frequency caps and no minimum CPM restrictions… characteristics of a typical “lower-tier” strategy. But this simply isn’t true. Have you ever asked your “lower-tier network” if they could offer you a second account with a frequency cap or a floor CPM in order to test out some higher end rates? This “premium” account could easily default to your already existing “lower-tier” inventory account and suddenly you could be monetizing your entire inventory with the same network.

The trick is simply to change your perspective, focus on the right metric and actual delivered value, and follow the ROI.

Greater Revenue May Be Right Under Your Nose

Though I cannot speak for every “lower-tier” network – I can certainly speak for ours when I say that, with the right software in place, a progressive network can optimize placements across all of their publishers to find the highest paying ad for each impression on each site, making every publisher as much money as possible on every ad call. Utilization of a market-driven ad delivery platform and dynamic yield management and CPM optimization technology, has positioned some younger, lower profile, ad networks to make some real noise in the industry over the next year.

One thing is for sure. If your 3rd tier network is using these cutting-edge techniques, and your 1st tier network isn’t, you stand to make a lot more revenue on a daily basis moving your 3rd tier network up in your chain. Many publishers have already discovered this and, as a result, the ad network landscape is changing quickly.

So think about your chains and decide if they really do make sense, especially if your “lower-tier” network is not really a “lower-tier network”…but is really an opportunity to truly monetize 100% of your inventory as efficiently as possible.

You’ll never know if you don’t give it a shot!

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.

“If you want something done right, do it yourself.” We’ve heard this all our lives; we think and say it often. It’s part of the human fabric from which we’re spun.

This do-it-yourself spirit infuses everything we do, but nowhere do its commercial possibilities shine so brightly as on the World Wide Web. How else can you explain the wild popularity and success of MySpace and Flickr, largely the creation of their individual users, or the entirely new channel of commerce created by ebay and its millions of market participants from Mom and Pop to IBM and John Deere?

Enter Right Media and its platform that enables Web sites, networks and advertisers to link to one another in an endless chain of marketing opportunities. Good relationships generate good business, and good processes help make them better, faster. By providing the tools that enable thousands of participants in an open exchange to link their fortunes to one another, Right Media makes it more efficient and remunerative for all buyers and sellers of online advertising.

We spend a lot of time talking among ourselves and with customers and prospects about how a true marketplace for online ad buying and selling makes the process smoother and more productive for everyone. At its heart, our success is all about letting our customers build our business by empowering them to do it themselves.

The simple act of linking, for example, is a powerful process through which a publisher can increase competition for its inventory, an advertiser can find more prospects for its goods and services, and a network can facilitate trade among all players. So the next time someone asks you how to do online advertising right, tell them to “do it yourself” – with a little help from Right Media.

This week Adam Dell of Impact Venture Partners invited me to chat with his Columbia MBA class about the “Media Revolution” happening all around us. I got there a little early and got to see some of the material he was covering, and I was struck by his characterization of what’s happening in media as a revolution. 

It was something of a moment of clarity for me.  Perhaps it resonated because I’d just finished reading 1776 by David McCullough. The book chronicles the first year of the American Revolution, and it’s a particularly interesting piece of work.  We’re used to reading stories about how wars were won. But this is a story about how an ideological battle was sustained in the face of impossible odds, to be won later.  How an amateur army that was outnumbered, out gunned, out-trained and outmanned in every possible way managed to sustain a battle that should have been hopeless. What the American patriots did was survive a period in which they should have been annihilated. Then for an encore, they went on to win a most improbable victory. How?  I’m no expert, but there are two things that jump out at me about the American Revolution. 

- The revolutionaries had a different idea of what it meant to live on this earth and to be free. They had a fundamentally different ideology.

- The revolutionaries refused to fight by the rules which were the rules of engagement of a superior force.

Revolution is exactly the right word for what’s happening to media right now. Well, at least some of what’s happening in media.

The slugfest which is going on for dominance in search is only likely to get more violent as Microsoft enters the fray in earnest. It is certainly a spectacle. But it is not a revolution.  Even Google’s impressive assault on Overture’s market position was not the revolution it is sometimes billed to have been. The battle over search today is a land war involving heavyweights slugging it out for market share. Google coming from nowhere to dominate Overture was a flanking attack powered by a superior monetization mousetrap. There are hundreds of examples of competition over territory, market share and dominance. It’s much harder to think of a true revolution.

So what then, makes a revolution? A revolution is a fight over ideology. It’s not about dominance as much as it is about a different world view, a different set of core values…a different vision.

There’s something we hear a lot of over here.  It’s a composite quote, not attributable to any individual and not an exact quote. It goes something like; “Right Media is crazy to take on the status quo. They’re crazy to do it alone. They can’t swim across the ocean.”

I understand the logic behind it, but it only partly makes sense.  We’re not taking on the big closed networks. We’re taking on their way of looking at the world. Our business is not competitive to them, but our world view is. We have a fundamentally different ideology than they do. In short, we think the market should be liquid and transparent, and more access to information will benefit the buyer, seller and value-adding intermediary who embrace an open marketplace for advertising. For more on this, see related articles here and here. The closed networks think the market should stay closed, giving an advantage to the strongest intermediaries.  Google’s AdSense network would like nothing better than for market information to remain inside their proprietary systems. It favors their dominant market share. We’re not trying to take their market share away. We’re trying to change the market in which they get an unfair share today. 

We’re also not alone. Today over 40 ad networks are using Yield Manager to open their networks to buyers and sellers and other intermediaries. Publishers and advertisers are buying in too. With the launch of our Symple (working name) product in Q2, thousands of smaller publishers will be able to take control over the sale of their inventory. The marketplace we enable consists of thousands of advertisers, and we’re rapidly approaching tens of thousands of publishers. If this is the beginning of a revolution, and many believe it is, it is not a Right Media revolution. This is a market revolution. While a lot of attention is being paid to Right Media as the enabler of this new and open methodology for buying and selling advertising, there are hundreds of companies participating. This is about hundreds of companies, representing thousands of people who have embraced a fundamentally different methodology for buying and selling…not Right Media standing alone.

Some would say this is splitting hairs, and regardless of whether we compete head on or indirectly, we’ll be in their sights. Maybe so, but we’re willing to take that chance, because they’ll be forced to compete on our ground, by our rules. What we must do is change the rules of competition, and then we can have a revolution. And that’s why we don’t have to swim across the ocean. The empire (or empires) will come to us, comfortable in their superior numbers, talent, wealth and market share. And when they get here, they’ll find that the rules of the game are different, and that the revolutionaries are not 100 or so idealists working at Right Media, but hundreds of companies representing thousands of buyers, sellers and intermediaries who believe in a better, fairer and more open way of doing business.