Earlier this month, AOL launched the AOL Advertising.com Group, a b-to-b advertising division focused on serving publishers.
In hopes of bringing premium advertising to the online sector, AOL has harnessed several of its companies (Advertising.com, ADTECH, Pictela, Goviral, 5min Media, StudioNow, Seed and AOL Answers) to create a one-stop advertising solution for publishers.
Ned Brody, who was the founder and CEO of ARPU and former CFO of LookSmart, is acting as president and head of AOL Advertising.com Group. He says bringing premium brands to the Web has been one of the biggest problems in online advertising. “There is still a tremendous amount of advertising dollars sitting on the fence from traditional TV and print, as there have been no good scalable solution for brand advertisers on the Web. The average inventory sell-through is somewhere around 30 percent.”
Currently, the AOL ad network works with about 5,000 publishers; European-based video service Goviral deals with 25,000 publishers; and video service 5min Media works with another 1,000 publishers. ADTECH works with upwards of 700 partners.
Brody says that almost all of these publishers only buy one product or service from AOL at this point, and he’s hoping this new group will offer cross-platform (video, content, surveys, etc.) solutions to publishers presently working with the aforementioned companies.
Revenue is modeled differently for each branch of the group, “On the ad network side, we buy inventory for publishers; we pay them, and then we resell it to advertisers, essentially,” Brody says. “On the Pictela model and ADTECH side, we get a serving fee.”
Since AOL is now looking to combine businesses and services, in many cases, ad serving will be free, if a publisher allows AOL to monetize a “significant portion of a site’s inventory through Advertising.com.”
In addition to giving publishers larger (premium) ad sizes, ways to monetize video and offering custom content production (through Seed, StudioNow and AOL Answers), AOL can also syndicate HuffPo content.
The Advertising.com Group created a transparent ad network model so that advertisers know exactly where they are buying inventory. Dubbed “super channels,” advertisers will know what publishers they are working with, as bundles like “travel” are offered for purchase.
In time, the Group will offer integrated product suites, but its initial focus is cross-selling the company’s abilities on multiple platforms.