CPM Rates Decline, Results Demanded!
AlwaysON’s Bambi Fransisco interviews Rajeev Goel, co-founder and General Manager of PubMatic about the declining rates on many publishers sites. The rate drops are apparently anywhere between 12 percent and 20 percent, depending on the vertical. The verticals that were hardest hit in July were social networks, entertainment and gaming sites. There is definitely the seasonality affect that has come into play, but advertisers in general are pulling back from forms of online advertising that don’t intrinsically tie into direct response. If you ask me, that’s a good thing – why spend money unless you know beyond just theory that it converts!
At the end of the day, it is relatively simple to serve a banner to an end user. Social networking, entertainment and gaming sites in particular generally bombard users with banners. It only makes sense that these sites feel the stress, particularly as the offline recession continues to come online. Advertisers are right to demand more of a return on their spend. The PubMatic figures to me show the beginning of a trend in the social, entertainment and gaming verticals (and others). There will inevitably be a bounce-back in September and October, but overall these verticals need to provide more value to the advertisers in order to command the higher CPM’s. Factor in that 53% of Marketers Will Reduce Ad Budgets – Advertisers will increasingly demand CPA and CPC rates instead of the traditional CPM rates…and it’s about time.
Also Today’s In Online Marketing News
- Has UK Online Ad Spending Passed TV by eMarketer | eMarketer.com. “The majority of the UK’s advertising growth in 2007 came on the Internet. Ofcom, the country’s telecommunications authority, said in August 2008 that online ad spending had risen an average of 70.2% in each of the past five years, and reached £2.8 billion ($5.6 billion) last year. “
- What Facebook’s New ‘Engagement Advertising’ Means to Brands by Jeremiah Owyang | web-strategist.com. “A few days ago, I had a private briefing before the press with Tim Kendall, Director of Monetization at Facebook, below are the findings, with specific recommendations for brands. As I get more information, such as results and data, I’ll update this post.”
- News Corp.’s Murdoch rakes in $30M in 2008 by CNN | cnn.com. “Media titan brings home nearly 25% more than last year; share prices halved amid shift in advertising spending.”
- For Sale: Your Browser History by Farhad Manjoo | Slate.com. “Behavioral ad targeting, Web companies’ favorite new way to invade your privacy.”
- Advertising Placements by Industry and Top Sponsored Links, July 2008 by Nielsen Online | Clikz.com
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