This is the final installment in our four-part response to Jack Myers' "20 Questions for the Online Advertising Industry."Jack's questions, in the order they were offered, followed by our answers.
16. Should we encourage the creation and expansion of dedicated online media planning and buying organizations, or should we urge the consolidation of online planning and buying into traditional competencies? If traditional, is online most compatible and competitive with print, television, or even outdoor? Or all three?
While we all hold strong opinions on the relative value of these various channels, it really doesn't make much difference what we encourage or urge them to do. The most valuable and profitable businesses in that space will survive and thrive. Certainly the recent economic conditions have been rather harsh for the stand-alone interactive shops, but then it's been a bad time for agencies in general.
If I were in a position to encourage any particular structure for the online function within agencies, I'd probably maintain that it should still keep its own company. I don't think you can retrofit interactive planning, buying or creative within an existing TV, print or outdoor unit. Whatever we think or do, there will probably be both standalone interactive shops and dedicated units within major agencies for a long time to come. So I guess I'm saying the question is pretty academic at this point.
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17. How do we advance the perceived value of websites associated with traditional media, and encourage marketers to pay for these vehicles rather than demanding they be packaged as value-added?
Use the Nancy Reagan strategy. Just say no. Once you take a look at the P&L on the web properties of traditional media entities, you quickly get over the urge to throw them in as value added or merchandising. In truth, this really isn't happening all that much any more at the leading properties.
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18. How will marketers react to traditional advertising availabilities offered by non-traditional companies such as eBay and Amazon that are emerging as major online media networks, in the traditional sense of network?
I think we all need to get used to the idea that we live in a non-traditional media world right now. I take nothing away from Amazon or eBay; they've built two of the greatest businesses of the age and they're going to be around for a long time. Can they sell advertising? I don't see why not. Advertisers will react to them based on the value of what they can deliver and the service with which they deliver it, same as they react to Yahoo!, MarketWatch or The New York Times. If anyone is uncomfortable with Amazon or eBay being in the advertising business, then go out there and outsell them.
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19. How can we identify best practices and train salespeople to assure that we meet industry standards of excellence?
I've been training online sales teams for more than five years. What I come back to consistently is the need to stay focused on customer needs. The challenge with most online teams is getting them out of the weeds and focusing them on the core marketing needs that keep advertisers awake at night. The person controlling the total budget doesn't give a damn about clicks and interstitials and rich media capabilities. He or she cares about the film that's opening; the car model that's launching; the erosion of the company's market share and so on. I'd suggest that every online seller take some courses in marketing...understand how a brand is built, how a communications plan is written. Put yourself in position to talk about "how" the medium can solve problems and you'll do extremely well.
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20. How can we simplify administrative processes and assure that the cost-of-doing-business with online media suppliers is not unreasonably high?
This is huge. Right now there are three major issues that are killing profitability on both sides of the process. The first is Terms and Conditions. The IAB worked closely with the AAAA on this and they came up with standard T&C agreement that seemed to work for everyone. But today many agencies insist on appending the agreement with some pretty onerous terms. You can't have a profitable marketplace when every buy turns into a legal discussion.
The other big issues are ad unit sizes and the handling of rich media creative. It's going to be an iterative process on both issues, but I see the top 30 or 40 sellers coming together on ad unit sizes pretty quickly. Rich media is going to be a bit more of a slog. The fact that there are now just a handful of rich media vendors with wide adoption helps to stabilize this issue somewhat.
Send your comments and questions directly to Doug Weaver
