Vertical Ad Networks Vs Horizontal – The Ongoing debate

There’s been some buzz now for a few months over Vertical ad-networks coming into the industry and the impact that they will create. It was , too obvious, that there will eventually be a confrontation between the networks already established in the Indian market ( read : Horizontal) and the new kids on the block like Webchutney’s Go-Sindbad and Divanation and it would only be a matter of time before the industry starts debating with respect to the pro’s and con’s of both , and media planners wonder which ones to go for.

For me , surprisingly i should add , it appears to be rather simple. The major driving force behind the argument for Vertical networks is that they contain sites which are similar in terms of what they are catering to i.e travel , the sites included in such a network would cater to hotels , air fares, train bookings etc etc , each with an individual objective but related to a larger singular category – the assumption being that such a vertical will thus offer the best exposure to a travel related advertiser given the relevancy which exists and since its so relevant , advertisers in turn would pay a premium which consequently would drive up eCPM’s for the publishers and everyone’s happy.

Sounds good for everyone , but unfortunately that’s not they way its necessarily going to work for a few reasons in my opinion.

1. What is so different between a vertical network and a horizontal network offering the same channel with equatable strength ? In some ways, a specialized channel for a horizontal is nothing but a vertical network in itself. All that a Horizontal needs to ensure is channel targeting and then add further targeting options.

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Ad network’s to get more money

There’s good news for ad-networks across the globe. A recent study conducted by Collective Media reports that 75% of the interactive agencies and advertisers who took the survey are looking at increasing their allocations to ad network by 5% while the remaining 25% said they would be looking at increasing it by 15%.

While the research is skewed towards the US , if trends are to believed then India should be looking at something similar. It will provide a respite while at the same time a further need for innovation within this domain in India. The Indian landscape is getting a bit crowded withe the number of players already on the scene though , all things taken into consideration, there are but 2-3 which can provide the scale and reach advertisers are looking for.

Komli to serve ads on Ebay India….. so?

Komli get’s eBay – one too many blogs were buzzing with the signing of the deal which allows Komli to serve ad’s exclusively on the Ebay India website for a year. Congratulations and wishes were pouring in from everywhere and people referring to it as a deal which will shake up the Indian internet scene and a move which was long overdue. One would have easily missed the few comments posted which spoke about having apprehensions on the tie-up.

What do i think? …..simply..what’s the big deal?

The fact that ad networks would be looking at signing exclusive rights to publisher inventory in this market is not an insight, its common logic. The problem has always been on the projections and the deliverables.

From Komli’s point of view they get a big brand to boast about in the market. Their transaction category gets a face lift and seemingly the ability to negotiate higher rates within that. ..at least that’s what they think. But i don’t see it happening that way. Ebay India is a very very poor cousin of its parent company or other regional specific sites , anyone who knows the domain would know this. The transaction volumes going through ebay here would be nothing compared to those in the US or the UK, and hence that many less unique visitors / registered members on the site. Ebay India quotes its community size in India at 2 million. I think it would be safe to assume that a good 20% or so would be inactive members , one time transaction type of members which would then leave it with around 1.5 million.

1.5 million is not big , its in fact pretty small and Komli would probably have sites within their kitty which exceed this size. 1.5 million visitors in turn does not translate into a huge number with respect to impressions. Couple this with the fact that the Indian side is not a very strong brand and what is one left with ? Continue reading

Google’s New Forumla

How many of you were/are aware that google is in the process of rolling out a change in the formula which determines top spots placements for advertisers. The news is relatively old, being announced on August 2007 and the changes coming into place from October 2007 but is probably one of the most important changes made by Google in 2007.

Current formula is based purely on Quality Scoreand takes into account the actual CPC. Goggle however believed that this can be refined even more and should be considering that under the current equation, an advertisers placement depends to a large degree on the bidding characteristics of the advertisers below them, a factor not in control for the advertiser gunning for the top spot.

The change will be to take into account maximum CPC rather than actual, which allows for greater control towards this objective. This is also expected to increase the overall quality of the top ad’s for the users and give Google a larger pool to choose from.