In the latest experiment to rev up online advertising sales, five major Web publishers, including New York Times Digital, CBS MarketWatch and USA Today, are joining forces to sell advertising that spans all of their sites. The five Web sites, which also include Weather.com and CNET Networks, publisher of News.com, said Monday that have formed a loose partnership to sell ad packages to big marketers, which also want more bang for their buck in hard economic times.
AT&T WIRELESS, whose advertising for mLife data services made a splash on the Net earlier this year, will be the first marketer to play its hand through the deal. Ads are expected to run exclusively on the five sites in coming weeks. The company is spending about $1 million over one to two months at the exclusion of other sites, according to one executive familiar with the deal.
Since Web ad sales went south after the dot-com crash, Net publishers have developed a kind of bunker mentality, defending the merits of online advertising while experimenting with new formats. Industry estimates show a drop in ad sales from 2000 to 2001 after years of booming growth. The Interactive Advertising Bureau has reported 2001 ad revenues of $7.2 billion, a 12 percent drop from the previous year.
Analysts said such an advertising partnership is unprecedented, but they downplayed it as just one more response from battered Internet publishers to a steep decline in online ad sales.
"It's a defensive move; it's not something they would ever do in a robust market," said Marissa Gluck, senior analyst at research firm Jupiter Media Metrix. "Companies cooperate when they're forced to. If the ad market were to rebound tomorrow, this would collapse."
The alliance comes as Internet publishers have been testing broadcast models that charge advertisers different rates to hit audiences at times of the day when traffic from a target demographic is highest.
In recent weeks, New York Times Digital launched an ad package aimed at audiences visiting during certain hours. Called Site Sessions, the ads are designed so that a single advertiser will have exclusivity on the site for a "day part" similar to broadcast and radio advertising. For example, American Airlines ran a campaign in early June to appear on the site from 9 a.m. to 10 a.m. ET each day for a week-prime reading time.
The publishing consortium, called the At-Work Brand Network, is pitching advertisers on a highly valuable audience: business professionals logging onto the Internet from work. This demographic looks to the Web more than other media for a range of information during the day, according to a recent study from the Online Publishers Association.
AT&T Wireless, for example, had a goal of reaching an at-work audience. According to Media Metrix, the five sites in the consortium provide advertising clients with an at-work audience of more than 17 million unduplicated individuals. The deal allowed AT&T to purchase advertising across all five sites from one party; it will receive reporting on the campaign from one source.
AT&T Wireless "is excited about being the launch customer for the 'At-Work' Network," said Bryan Trullinger, director of online strategy for the company. "During the day, the Internet is the primetime medium, much in the way TV is at night."
The sites had to agree on ad pricing and availability during certain parts of the day, but the ads themselves will vary on each site. One site may use "road-blocking," or introductory messaging when a page is requested.
The online agency for AT&T Wireless, Avenue A, handled the deal.
The deal with AT&T Wireless is a blueprint of future sales agreements. But going forward, some of the sites in the consortium may change with each ad package, depending on the goals of the advertiser.
"The idea is basically (to link) likeminded sites with good traffic who together can take on the reach that big portals offer," said Larry Kramer, CEO of CBS MarketWatch. "The reach equals the reach of an AOL or a Yahoo. But the demographics and visitor engagement are better."
"In effect, we'll become a loosely strewn network ... getting a piece of a bigger pie. It's better to get 20 percent of a big deal than zero percent of a single large buy."
Stefanie Olsen, MSNBC.com. June 17, 2002
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