Aol had a busy year in 2010 as it announced its Project Devil initiative, made several acquisitions (5min, Pictela, TechCrunch and more) and continued its transition from as a standalone public company after being spun out from Time Warner in December, 2009.
Aol's Jeff Levick, the company's President of Global Advertising and Strategy, discussed Aol's display aspirations and his views on the digital media space.
AdExchanger.com: According to a Wall Street Journal article in July of 2009, Tim Armstrong was quoted as saying that he wanted to make AOL the market leader in online display advertising. Is AOL still set on becoming the leader in display advertising?
JL: The short answer is, of course. However, our definition of 'display leader' might differ from yours. We believe that leading display means having the best formats and most engaged audiences for brand marketers. We have said before, and still believe, that the formats for display as we know it today are fundamentally broken. Consumers ignore them and they're not adding valuable marketing experiences. Our market leadership is about changing what 'display' means to marketers. We believe that the true opportunity is to make display an interactive and engaging content experience. Our launch of Project Devil and acquisition of Pictela are examples of what we believe the future of display looks like.
With Project Devil, it appears you're opting to sell bigger, more integrated ads. Are "big ads", so to speak, the future for display?
To be clear, Project Devil is not about size. It's about form and function. It's about what we believe a page of content with ads would, could, and should look like if the web were designed today. Devil is an example of a solution that brings engaging content to consumers in a design friendly way, albeit the content is commercial, but content nevertheless. This is how we believe display advertising needs to evolve and the consumer engagement data we're seeing so far more than validates our theory.
In your opinion, where should a large publisher begin when establishing rate cards for ad inventory and balancing between allocating for direct sales and the non-guaranteed market?
Publishers should spend the majority of their time producing high quality, engaging experiences for their audiences. Publishers don't set the rate card. Consumers set the rate card. They vote with their engagement and their interaction with every page of content. If engagement is high, and the consumers are loyal, the rates should reflect this value. If the experiences are created solely for the ads and monetization and not the consumer, then the rates should also match that very low level of value.
Can you discuss your thoughts around the importance (or lack thereof) of scarcity of inventory in a publisher's media placement strategy?
Publishers shouldn't create the scarcity, but the consumers should. Meaning, if the experience is highly value, highly engaging, and highly trafficked, the market for this inventory will be scarce by nature. But, if your question is about how many ads should be on a page of content, we believe that less is more.
In general, what has surprised you about digital advertising in the past year?
I'm very surprised that the conversation isn't more about aesthetics and design. If you look offline at industries where consumption is declining, the rate cards aren't and in fact they're increasing. That's because there are fewer and fewer high quality places where the world's largest brands can market their goods in high quality, safe visual environments. The past year, the conversations continue to circle around price, targeting, and 'inventory.' These are important parts of online advertising, but the real share shift will occur when the biggest brands in the world have a beautiful and safe environment, with highly scaled and engaged audiences, to promote their products.
By John Ebbert
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