How Will Brand Ads Reach the "Long Tail"?

Online advertising is  continuing to take off with over $25B in global revenue this year and no signs of slowing down.  This has been dominated by performance based ads but brand advertisers have taken notice and are migrating to the web - especially given the increasing shift of audiences from traditional media to the net.   

The challenge for brand advertisers is to find audiences they want to reach (at scale) done in the most effective and emotional way (e.g. rich media) and in the right context (e.g. not next to content they would find offensive or unknown - like most user-generated content or certain news stories).   Until now, they've flocked to premium inventory at the major networks (Yahoo, MSN, AOL) and vertical sites with scale (e.g. ESPN, iVillage) but these networks and sites are selling out the quality rich media inventory in the right context (they have plenty of tonnage in areas that brand advertisers don't care about).    There's a supply-demand mismatch and I think there's an opportunity for the long tail to take advantage of it.

The issue for the long tail is that each site alone is too small and is not "validated" by the advertiser or someone they trust.  The solution actually lies in the "head"...  These sites or media publishers (large branded anchor sites or traditional publishers) can create a large branded network by affiliating with many sites in the long tail.  The anchor typically has a strong brand (e.g. Washington Post or an upstart like Glam) and handpicks long tail sites that meet their quality standard to include in the network.  They then use their trust and relationships with brand advertisers to sell ads across the network - perhaps at a discount to their anchor site.  This is a perfect setup for publishers who have deep brand advertiser relationships but not enough quality inventory (such as traditional magazines who don't have a ton of users on the web).  The long tail may have great content (e.g. high quality blogs or hobby sites) but doesn't have the scale or expertise or relationships to get the ad dollars and can get more revenue per pixel vs performance ad networks.  It's a win win all around.

i'm interested in investment opportunities in this new ecosystem - whether its a new upstart network by a publisher/entrepreneur or a platform to make all this happen (like Adify).  It's inevitable that more dollars will move online (6% of ad spend is online but time spent online by consumers ranges from 15%-35% depending on the demographic) and this seems like the right way for brand dollars to find their audiences.

Comments

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[kimgeek]

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[techie]

Talk about SPAM comments. You might want to move this blog to Wordpress so you can use Akismet.

Anyway, I think your description fits well with what I think is going to happen with PayPerPost and this kind of advertisers. I know PayPerPost is quite controversial, but their next release in a few weeks I think will go a long way to accomplishing what you're describing on the web. Of course, we'll see if PayPerPost sales team can execute on that vision.

[Fred]

I think paypost will get in there and do their magic. It might just take awhile.

[Davion]

Larger networks often face the problem of targeting long tails. Smaller companies on the other hand are able to manoevre faster, make changes to their product offers to reach the long tail markets. That is perhaps why networks like ClickBank can do well.

[Aurelius Tjin]

This is obviously one great post. Thanks for the valuable information and insights you have so provided here. Keep it up!

[Mark Rae is building his website...]

Cai I add something:

The long tail is a type of statistical distribution where a high-frequency population is followed by a low-frequency population which gradually "tails off".

The long tail in keyword research is basically an expansion of a core, generic, high volume keyword phrase to include numerous combinations and permutations of the keywords and their associated or relevant phrases.

These phrases individually are unlikely to account for a great deal of searches, but when taken as a whole, can provide significant traffic. The long-tail is unlikely ever to exceed searches for a brand name if the brand name is reasonably well established, but the volume of converting traffic these terms can generate by nature of their specificity and relevance is worth investigating.

Ken Jurina reiterates that thorough keyword research consistently uncovers surprising topics in every study and presents him with numerically supported ratios that challenge his assumptions about his industry.

[DJ Chang]

RAJ,

You are correct about branding ads, but have identified one of the needs. Such a large, disruptive opportunity requires depth of tactics and strategies. I have experience with hundreds of B2B magazine, book, newspaper, and online publishers; and ad resellers.

Take a look at the depth of research at http://adecon101.blogspot.com. The company is in stealth mode.

-Dash Chang

[Sinela]

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Success,

[Paul Middleton]

Chasing the long tail in my experience can be unrewarding. Go for the bigger markets where you only need a fraction of the searches to be a success. 5% of 2000 searches is more than 100% of 2!

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[Regular marketing player]

@Paul; Maybe so. But you must be a pretty good expert to go for the 5% of 2000. I still get my little money out of the Long Tails.

btw. some sort of spamfilter in this section couldn't hurt :S

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