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Rich Media Soon May Make More DM Sense

Rich media soon may make more financial sense for direct marketers, recent developments indicate.

It long has been known that rich media, or online advertising with sound, moving graphics and interactivity, is more involving than static advertising. But deploying it has been complicated and expensive, and the audience with the bandwidth to view it properly is limited.

However, broadband use in the United States rose 49 percent from May 2002 to May 2003, according to a report released yesterday by Internet audience measurement company Nielsen//NetRatings. As a result, 39 million Americans, or 13 percent, have high-speed Internet access, the report said.

And marketing technology and services company DoubleClick Inc. announced this month that 30 advertisers, agencies and publishers are beta testing a rich media ad solution it developed with Macromedia. DoubleClick is estimated to have 80 percent of the third-party ad serving market.

The company's rich media product, slated to be available in the United States in July and Europe and Asia in September, integrates DoubleClick's DART ad serving technology with Macromedia Flash MX software.

It will cut the time to deploy a rich media campaign from two to three weeks down to two to three days, said Scott Spencer, director of product management for publishers at DoubleClick.

“The costs associated with rich media are not just the serving costs of the technology, but there's the cost of that deployment process,” he said.

Many think that along with keyword search advertising, rich media will help spark online advertising's comeback.

Twenty-eight percent of ads served in first-quarter 2003 were rich media, compared with 17 percent in the same quarter a year ago, according to DoubleClick's Ad Serving Trend Report.

Also, rich media generates “higher rates of post-impression activity per impression (0.78 percent vs. 0.41 percent for non-rich media),” according to DoubleClick.

Moreover, Advertising.com, a Baltimore pay-for-performance ad brokerage firm that serves 10 billion impressions monthly, claims that rich media generally drives four times the conversion rates of non-rich media advertising.

But rich media ads until recently cost 10 times more than static ads to produce and place, said Scott Ferber, Advertising.com's CEO.

“The big challenge for DMers on rich media has been that historically the price that publishers charged for running it has been greater than the added value it created,” he said. “Now the rates are coming more in line with performance.”

Rates to produce and place rich media ads still can run three to seven times that of non-rich media ads, but with broadband use growing so rapidly and DoubleClick poised to help fuel growth in the market, direct marketers should look at rich media advertising more seriously, Ferber said.

Also, rich media's current conversion rates include users who view them via dial-up connections. As broadband use grows, Ferber argues, rich media conversion rates should grow with it.

“There is tremendous lift in rich media for DR people,” he said. “It is a great opportunity. You just have to find a place [to advertise] where the publisher doesn't overvalue just that fact [that rich media creates such a strong lift in conversion rates].”

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