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Clients Clamoring for Upfront Web Sales
AdWeek
By Mike Shields
December 17, 2007
NEW YORK -- Two years ago, MSN's sales team started talking with
retailers in the spring about locking up key ad avails for the
holiday shopping season. Last year, those conversations were pushed
up to February. Now, according to Mike Hard, MSN's vp, U.S. online
ad sales, his team is spending the current holiday season talking
about the next one, and in some cases is selling inventory a year
or more in advance.
That flurry of advanced selling is indicative of an emerging trend
in online advertising—a business typified by perpetual media planning.
Even as the medium continues to expand and fragment, and as the
industry preaches long tail and audience aggregation, sellers from
top sites say that many brands have been pushing them for more
upfront-style buying. And categories such as retail, pharmaceuticals,
travel and packaged goods are following the lead of the automotive
business, which for the past few years has seen advertisers commit
significant portions of their budgets to the top handful of publishers
in each segment on a yearly basis.
Several forces appear to be propelling this trend. The Web is
becoming a more crucial ad vehicle for traditional brands, and
thus the dollars are getting more serious: eMarketer predicts growth
of 29 percent in 2008. And, as many categories grow more competitive,
brands risk being shut out of the most desired inventory if they
don't move quickly.
"We've definitely seen some pretty dramatic changes in the way
people are doing upfronts," said Hard. "It's been particularly
dramatic in the last three or four months."
That's not to say the Web is going the way of TV and brands will
soon be dumping two- thirds of their budgets for the year during
a single week in May. Rather, sellers say online advertising's
version of an upfront turns the old model on its head. "What's
different is that advertisers are leading the upfront instead of
the publishers," said Scott Meyer, CEO, About.com. "They are inviting
their key publishers in. It's flipped around."
Of course, as the number of pages consumed on the Web continues
to grow, particularly with the explosion of user-generated content,
there is no shortage of inventory. But, "there is not lots of quality
out there," observed Meyer. "It's mostly low-rate, undifferentiated
stuff. Marketers are realizing that quality stuff is going earlier
and earlier."
The quality of inventory that tends to go early, according to
sellers, is super-targeted content (like Web pages related to specific
car models), home-page avails, video and those ever-elusive "big
ideas" that clients always seem to want. "More advertisers want
custom packages," explained Sheryl Goldstein, svp, sales, About.com,
who spent the last several years at AOL. "And the only way to do
that is selling upfront."
As online marketing becomes increasingly crucial to the pharmaceutical
industry, upfront sales are becoming prevalent on health sites.
Greg Smith, COO of Neo@Ogilvy North America, said that several
years ago he was encouraging pharma clients to sign deals with
top health publishers like WebMD.com for as long as three years "to
grab every single cholesterol impression out there."
Michael Keriakos, co-founder and evp of Waterfront Media, the
New York-based parent company of Everyday Health, said his company
was invited, for the first time, to several advertiser-led upfront
events this year. As a result, the company has already locked up
35 to 40 percent of its revenue goals for 2008.
Wayne Gattinella, president and CEO of WebMD, said his site's
experience was similar, and that several brands committed 2008
budgets by September. "That was earlier than any time previously," he
said. "I wouldn't categorize it as a tidal wave. But these are
large commitments of scale."
Beauty also is buying in early, according to Tessa Wegert, interactive
media strategist, Enlighten, Ann Arbor, Mich. Wegert said that
for her client Kao Brands (Bioré, Jergens), there are two or three
core beauty sites, including style.com, that have become must-buys,
and competition is fierce. "In the last few years, we found that
we need to be buying way in advance of when we would for other
clients," she added.
A similar dynamic exists in the bridal category, according to
Carrie Reynolds, publisher, TheKnot.com, which has participated
in upfront selling for several years. Lately, "what's happening
is that non-endemic brands are starting to adopt these practices," she
said.
Although some buyers bristle when the word "upfront" is uttered,
the consensus is that online advertising has become more cyclical. "Buying
and selling is getting a little bit less crazy than it was," said
Jeff Ratner, North American digital director, MindShare Interaction. "But
there is still a lot of opportunistic buying."
Amanda Richman svp, director of digital services, MediaVest, wondered
whether some sellers were overstating the importance of such upfront
events.
For digital buyers, she said, "it's a 52-week upfront."

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