AudioBase Adds Sound to Banner Ads

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AudioBase Inc., Sausalito, CA, plans to make its corporate debut on the electronic advertising market this week, tempting clients by adding sound to Net banners.

Having completed a $2.5 million round of financing, AudioBase -- which as recently as January was a four-person shop operating out of a houseboat -- is touting banners that supply high click-through rates without slowing PCs by using the large chunks of memory.

Advertisers can customize "click-on" buttons designed to prevent the banners from blasting Web users with unwanted sounds. And while other rich-media banners require plug-ins and download Java applets that use between 10K and 15K, AudioBase's banners can be run smoothly by more computers because they use only 4.1K and don't require a plug-in, the company said.

"Out of the gate, we have broader reach than other audio media," said AudioBase president/CEO David Haynes. Another benefit is that PCs don't slow to a snail's pace while the banners load. Web portal Yahoo Inc. has made AudioBase banners one of the first rich-media formats it endorses.

Haynes promises a 15-minute turnaround time for companies that want to load their radio advertisements into banner ads. Clients can select from an audio library as well. AudioBase hosts and streams the ads itself.

Bernie Yu, director of membership marketing at Inc., San Francisco, said the online rewards firm tested two banners in December -- one with an added voice-over and one without sound -- and the AudioBase banner's click-through rates were double the other banner. Conversion rates, however, were roughly the same.

Click-through rates yielded by other clients' tests surpassed typical banners by as much as 500 percent, Haynes said. AudioBase charges between $3 and $5 per thousand ad impressions. Clients must pay separately to create and place banners.

But as with other rich media, the possibility looms that the improved click-throughs result from the novelty of banners with sound. Banners declined in efficacy as Netizens grew accustomed to them and their numbers increased on the Web, said Marissa Gluck, online advertising analyst at Jupiter Communications, New York. The cost-per-thousand price structure could create problems for AudioBase if advertisers demand a more performance-based model as well.

"I think they're going to start to run into problems in the not-too-distant future," she said, "especially since their whole spiel is that they can result in higher click-throughs. I'm sure advertisers are going to start asking them to put their money where their mouth is."

But, overall, Gluck is a fan of AudioBase, whose technology provides a good sign that rich media is beginning to overcome the limitations imposed on it by plug-ins and bandwidth issues. And as of right now, the company is beating the competition.

Ad management firm AdForce, Cupertino, CA, and Web advertising network Flycast Communications Corp., San Francisco, both resell the audio banners. AudioBase is negotiating with other resellers, whom Haynes declined to identify.

Other organizations that have tested AudioBase's banners include Intel Corp., Toys "R" Us Inc., the U.S. Navy, Acura and Macy's, and the company recently signed on Audio Book Club as well. AudioBase also has begun testing the technology within e-mail messages. The company now boasts a staff of 16.

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