THE BLOG
06/22/2010 05:12 am ET Updated May 25, 2011

Ad Networks or Content sites? Content or Data? Confused? Listen to the Crowds

If you weren't paying attention you might be confused. Or, maybe you are paying attention and you're still confused. Or, maybe in your confusion you've decided to quit paying attention and watch for signs of warmer weather.

Just in case, there is an interesting juxtaposition today in Ad Age between research from Advertiser Perceptions that reports marketers are accelerating the shift back to content sites for media buys ("Marketers Shifting Online Budgets to Content Sites"), and a column from investment banker Tolman Geffs arguing instead that the momentum is with the audience networks ("Get Ready for the Coming Land War in Online Display Ads").

Says researcher Advertiser Perceptions:

A survey of agencies and marketers revealed that 52 percent of them plan to spend more on content sites this year, whereas only 35 percent said they were likely to increase budgets for ad networks.

Says banker Tolman Geffs:

Online display, primarily a brand advertising medium (as measured by revenue), has traditionally been sold on the basis of sites and specific media placements, or via ad networks that aggregate sites into vertical channels. Now, with the evolution of online ad targeting techniques and the rapid growth of a market for consumer targeting data, it is increasingly common to sell advertising on the basis of audience, reaching individual web users based on specific data about that user.

Confused?

It might help to read the comments that followed each post.

I would hope that we don't actually have to explain to marketers why it's a better opportunity to surround yourself with good content rather than just a cheap spray and pray methodology ... But ... The reality is, I don't believe that most of the agencies who have recently incorporated "digital" into their titles or their top-level pitches are actually staffed to be able to support content direct buys. This is why the networks will continue to thrive, is because it's "easier" on the agencies and their wallets. If I owned a content site or portal, I'd do the same thing as ESPN and the others, and I'd ban all network based ads and force agencies to do a better job or at least properly staff up. That being said - content sites better be prepared to show ROI -- whether it be brand or actual sales, or they will lose out faster than before.

And in response to Tolman Geffs:

You are right, it is a crowded space. (It does not take a genius to figure that out.) This game of musical chairs is not going to result in a wave of consolidation, it will result in a return to the fundamentals of media -- content, audience and advertiser. The agencies have the revenue, the publisher has the content and the consumer is in control. When everyone decides to take their bat and ball home with them, these middlemen are going to be left with aging IP that does not generate revenue.

It is wise in this case to listen to the wisdom of the crowds, starting with the need to fix agency compensation. Then perhaps, we can focus on value.