Tuesday, December 20, 2005

The Great Ad Debate

First, a little dirty laundry. One of our developers told me yesterday that the only way he finds out about what's going on at the company is by reading the blog. Um, we're a 40 person company. And I know this developer and he's here every day, talking to people and such. File this under "things that make you go hmmm."

On to business.

Yesterday's great advertising debate was around whether and to what extent advertisers want and need demographic information. I maintain that potential podcast advertisers need and want demographic information. They don't get it today in most online podcasts so we mobilcast guys can add additional value, and in turn we can get higher value per click.

The other side of the table argued that Google doesn't provide any demographic info, and in fact doesn't know its users at all. Yet they make a bunch of money on advertising.

So the question is whether podcast and mobilcast advertising is more like Google. If so then it's not necessary for us to gather any demographic info.

I argue that podcast and mobilcast advertising is like radio and other broadcast media. As such it is imperative to have good customer data to help advertisers target their ads, which in turn allows the podcaster/mobilcaster and the aggregator to place a higher value on each click.

I say this because I believe the usage model is different. When someone uses Google they are searching for specific information. The key word here is search. The ads are simply part of the result set. They are targetted of course, but the user has the option to follow the link.

Contrast with podcasting, which is a subscribe model. True one often searches for a specific podcast to get started, but once the podcast is found and subscribed to the listener generally stops searching. Subscription assumes the listener comes back regularly. In this model the ad is inserted into the podcast (audio or graphically) on a somewhat targetted basis. And if the advertiser is smart they will purchase insertion into multiple episodes to maximize exposure.

And what makes an advertiser select a given podcast? Demographic information. Someone selling Geritol is not going to advertise on Dawn and Drew. It's not the right target.

Advertisers will pay more for better targetting. Better targetting leads to better follow through and more qualified leads, which in turn means better chances of making a sale. Which brings it all back to demographics.

The beauty of this is that it's all new ground. We as a distributer of mobilcasts have an opportunity to create the model that works. To work it needs to be high value for the advertiser, and relevant to the listener. By relevant I mean fit their interests and integrate with the way they manage and listen to podcasts on the phone. If we try to force the wrong things on them they will vote with their feet.

Technorati tags advertising advertisers podcast advertising podcast marketing

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