Networks Provide Brand Response vs. Direct Response

Ad Age recently reported on the Epsilon CMO Survey that noted a shift in thinking and ad budgets away from traditional media and into digital advertising among large brand CMOs. The study found 60 percent of firms are decreasing traditional media spending, while 66% are increasing their digital media allocation. While the actual dollars may not be a one-to-one trade off, this reallocation of budget exemplifies the strategic role digital advertising will play with large brand owners. Unlike the Internet bubble advertisers flush with VC cash, these are big brands making large budget shifts that will become a permanent part of their media spend.

Brand owners also want wide distribution for their message, which typically means less content integration and “out of box” creative, and far more reach. They also want to drive clicks, actions, and sales to complete the sales process and make the cash register ring. So when these brand owners move online they are not just jumping with their eyes closed. They are testing and learning ways to manage their brand in, for them, a new environment. They seek broad distribution on portals like AOL and Yahoo!, but increasingly see the importance of relevancy in their buys. They work with technically sophisticated ad networks to find the users they believe are most interested in their product. But they want to show that message when the user in engaged in a relevant topic where the ad provides value.

In addition to testing new media distribution options, marketers are making new use of sophisticated, relevant ad creative to move consumers through the purchase funnel. The creative they utilize for upper-funnel activities – brand awareness, favorability, and consideration – includes sponsorships, site takeovers, roadblocks, as well as a liberal use of rich media and content integration to introduce their brand to the audience.

A spectrum of advertisers, three flavors of ad networks

Getting the proper mix of distribution and ground-breaking creative is tricky business. Enter today’s ad networks, broadly defined as companies that represent multiple sites and serve the needs of advertisers. Ad networks fit into three categories: pure brand networks (also known as site rep firms), direct response networks, and networks that can fully serve brand advertisers with both branding objectives and performance goals – let’s call the last type “brand response networks.”

Comparing, and depending on the campaign using, all three requires some definition. On one end of the spectrum lie networks that offer premium content and focused audience composition at high CPMs, but limited distribution and reach. These networks focus on pure brand advertising, where the brand plays a large role in supporting the content on the site. These networks often own or control the content on the sites they work with, limiting their reach. The other extreme consists of the horizontal ad networks and their exchange partners that flood the market with low priced ad impressions and focus on driving a direct response metric. These are networks that tout the ability to reach nearly all Internet users at some point during the month, and use a mix of tools to reach an advertiser’s performance goal. However, these ad networks are more focused on massive reach than focused targeting or transparency.

Emerging in the marketplace between the brand and direct response extremes are the transparent, vertically focused ad networks that offer reach, direct relationships with publishers and very detailed reporting. The value they offer as brand response networks marries the requirement to distribute and promote the brand, deliver results, and protect the brand asset along the way. Brand response networks narrow distribution to capture the highest composition audience to an advertisers target while still providing reach. They are fully transparent and provide advertisers with a full site list specific to a campaign, site level reporting and work towards a performance goal based on the metrics set by the advertiser. Additionally, brand response networks run on the type of technology platform that provides state of the art targeting options, as well as unique, distributable creative units to get the message noticed.

What’s your brand response sensitivity?

The brand response advertiser walks a very fine line between the brand part of the brain (“I must retain the highest standards of quality no matter what cost”) and the response side of the equation (“We must meet our numbers at all costs”). Both needs of the advertiser are effectively addressed by the brand response networks if they:

• Live by metrics. Measurement, as we all know, is the key factor in driving performance. However, advertisers must be certain they are using the correct measure or combination of measures vis-à-vis their campaigns overall objective. Effective campaign measurement can incorporate a host of ROI metrics including CPA, CPL, CTR, eCPM, brand lift, ad recall, interaction time and many others. A brand response network can provide you the metrics you need, not just the one they have for you.
  
• Are fully (and I mean fully) transparent. Most networks will provide you with some form of a site list. But to be truly transparent, the network must provide a site list of the exact placements (to the URL level) for your campaign – not an abbreviated or exhaustive list of where you ad could appear. Additionally, campaign reporting must be to the site level (see previous bullet point) and show you how sites were optimized on and off the campaign. This site level reporting is critical for you to understanding where your campaigns work best and allows you to optimize future media spend.
  
• Excel in customer service. While it is imperative that the first two criteria are met, it is more important that the company serves your brand needs. Getting to the root of a performance issue – be it a creative or placement issue– requires your network rep to be available at all times. If you can’t get them by phone, email, Blackberry, Facebook profile or any other means of communication, you risk your brand’s reputation while trying to track them down.

Do brand response media buys cost more than direct response? Yes, but the value an advertiser receives from the higher CPM on a brand response network offsets the additional price. They provide a closed network of high quality sites, a finely targeted audience, and the reporting and service to back up what they promise to deliver. They cost less than content integration platforms, but more than broad, blunt, blind reach networks. For advertisers balancing the demands for both branding and performance – brand response networks may be the answer. They provide the creative solutions, targeted reach, transparency and reporting that ensure success.

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