Big Network Notices the Small Things

Q&A:
Jim Waltz

Traffic Marketplace doesn’t shy from innovation. It reaches 142 million unique users per month with its 30 billion ad impressions monthly. That’s more than 20 million leads and customers per year. It does this through targeted display ads, email and custom marketing. We asked president Jim Waltz about why people relationships are better than technology and how sales forces will change the face of ad networks.

Should ad networks innovate technologically? What are some things you’ve done?

Absolutely! Some of the industry’s more interesting innovations have been born and bred by ad networks, such as third-party ad serving, behavioral targeting, ad exchanges, etc. At Traffic Marketplace, we’ve focused recently on advanced audience identification, cross-channel ad delivery and bundled engagement tools to make ads in our network more compelling to consumers and more effective for our advertisers. Some of our unique innovations include embedded Click-to-Chat functionality, Flash-less rich media and the production of original content to build trust and credibility for brands and their marketing message.

As ad networks proliferate, where is your place in the growing galaxy?

The proliferation of ad networks is misunderstood and really depends on your definition of "ad network." There are three main types of ad networks: a few large, horizontal audience-based networks like us, many smaller vertical networks that specialize in a particular category, and a ton of small ad brokers. We’re also seeing a lot of smart companies act as exchange specialists, a sort of agency’s agency, leveraging their knowledge of exchanges and other large pools of liquidity to manage a big chunk of display budgets.

Do you think the industry is preparing for consolidation? Would more mergers be a good thing?

I don’t think it is, at least not in the way the industry is predicting. In fact, the number of ad networks is still growing. Most ad networks are structured in a way that they can quickly scale up or down based on demand. In addition, there have been very few compelling reasons for networks to hitch together. A more interesting trend is the growing consolidation of sales forces in general.

What do you mean by that?

Well, the media buying process is still very biological — in a recent industry study, nearly half of all buying decisions were greatly influenced by the quality of the relationship between the buyer and the seller. This works well for offline media buying, where there are only a few thousand magazines published, for example, but not so much online with millions of ad-supported websites. As online budgets increase, media buyers are forced to work with larger relationships that have enough scale and can afford to invest in cutting through the clutter of 200 unanswered cold calls a day. A lot of great Web publishers are often lost in the noise and are beginning to partner with networks that are already in the door.

As networks diversify their offerings (lead gen, email, display, etc.), can they maintain quality of service? How?

Service quality is a big problem when dealing with cross-channel campaigns if there is more than one system delivering the ads. But we’ve seen that if you can unify all channels under one ad delivery platform, I think service can not only be maintained, but significantly improved. The challenge then is really organizational — you need a very educated sales force with a lot of support from channel product experts. You also need great reporting and analytics.

What can ad networks look forward to in the future?

Ad networks won’t exist as we know them today — they will look completely different over time. As the marketplace becomes more transparent, sales forces consolidate, and the buying and selling process becomes more digital, there’s very little left to differentiate one network from another. At that point I think ad networks will evolve in two directions: those aligned with buyers as service providers with specific expertise that taps into the marketplace on behalf of advertisers, or those aligned with sellers as extensions of exclusive, proprietary content. But these changes are predicated on a massive transformation of the online media buying and selling process.

Working with Performance Marketing Networks

For Publishers and Advertisers

The number of performance marketing networks has gone through the roof in the last year as the technology needed has become more accessible. There’s no reason not to work with several networks at once but you should bear the following points in mind:

For Publishers:

  • Talk to one of the affiliate managers. They’re the people who can really make a difference to your earning capacity.
  • Examine their payment policies and check out the forums to see if there have been any payment problems.
  • Compare their offers to others in the industry. The highest paying offer isn’t always the best. Conversions are what counts.
  • Do a reputation check by talking to industry colleagues. There are lots of ways networks can rip off their affiliates, so be aware.
  • For Advertisers:

  • The rule of thumb is that CPS gives you higher quality, CPA greater quantity. All things being equal the difference should simply depend on your conversion rate.
  • Check everything you can: applicants, lead quality, sub-IDs, ROI by publisher, etc. Don’t rely just on the network to pick up problems.
  • Look at the network’s fraud prevention systems and at the staff running them. Fraud is widely prevalent and you need a network that is alert and protecting your interests.
  • Look at where the traffic is coming from and what control you have over it. Be careful of networks that are simply acting as brokers or that are buying cheap traffic from unknown sources.