This morning's Wall Street Journal wrote up (subscription required) on the burgeoning Web platform and the conundrum facing pretty much any mainstream marketer with money to spare and the premium web publishers (portals) with limited inventory.
My thoughts are two-fold:
1. According to the article, MSN is charging up to $1,000,000 for a 24 hour home page placement. $365,000,000 for the year all things being equal (which they aren't)
By comparison, ABC has roughly 60 slots to sell for next year's SuperBowl at roughly $2,500,000 a pop. That works out to $150,000,000. I'm rounding off pretty liberally and certainly not factoring in value-add deals, volume discount, sponsorships (on both the up and down-sides), but I think you get the point: 1 network 1 day a year = 1/2 a major portal's annual premium inventory on their homepage. (feel free to tear apart my logic, math, assumptions etc)
For instance, only 1.5% of the population is in the market for a new car or truck each month, says Betsy Lazar, general director for media and advertising operations for General Motors Corp. But, she says, "about 70% of people in the market for a car go online, so it's logical that we need to go there."
Good point Betsy...but surely you'll need to be there 365 days a year as it is a moving target...and if so, why are you not roadblocking one or more of the portals as close to 24x7x365. You've got the money. Oh that's right...because you can't; it's not available.
Takeaway 1) There has to be more than just homepage placements in order to scale this opportunity. Besides going deeper into the portals themselves (mail, finance, autos, sports), there also has to be an evolution of how premium homepage placements are bought and sold...put differently, the days of 24 hour placement is a non-scaleable luxury.
Takeaway 2) This problem underscores the very fibre and foundation of where advertising is going...on all fronts (except probably Cosmo or Vogue) - clutter is becoming a thing of the past. One ad (pre-roll) before a video clip is the online norm. Just this week we saw the AOL/WB announcement, on top of the CBS/NBC onces and it seems as if our best shot is 4 x 15-second spots per showing. That's a far cry from the existing model of 18 minutes of commerials per hour of programming. Prices can increase up the old wazoo...no way the revenue can be made up.
2. There has to be more...and there is: it is and will take the form of a combination of a network model overlayed against the oodles of consumer generated content. Adam Curry is doing it with his Podcast Network; Weblogs fetched a handsome price on the market. Gawker media has signed a deal with Yahoo.
So in short...let's dig a little deeper until the hood of homepage placements, roll up our sleeves, get our hands dirty and grease the wheels of consumer generated content and re-open the doors of the Web: it's very much open for business to anyone who's prepared to stop looking at it like a freakin' traditional media buy.
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