Cost-per-click online ad network ValueClick announced this week that it has segmented its 6,000-site network into 14 categories for targeting.
Launched in July 1997, ValueClick offers site publishers a way to move unsold advertising inventory on a cost-per-click basis without damaging their brands, said Guy Hill, director of business development at ValueClick, Santa Barbara, CA.
“A lot of companies don’t want to let buyers slug away at their rate cards because they know they’ll never be able to raise their prices if they get buyers trained at a certain level,” Hill said. “What they’ll do is lock in at, say, a $35 CPM [cost-per-thousand impressions rate] and sell 50 percent of their inventory. That’s a huge opportunity for someone to come in and sell the [remaining 50 percent] through another channel.”
The channel to which Hill is referring in this case is ValueClick. Though ValueClick will track and report results from sites for buyers, it will not place ads on specific sites to avoid undercutting sellers’ CPM rates, Hill said.
Ad buyers on ValueClick can buy run-of-network advertising for 35 cents per click and, as of last week, advertising targeted by category for 50 cents per click. Volume discounts and discounts for agencies are also available.
“If you want to buy Yahoo!, then you should go buy Yahoo! [on a CPM basis],” Hill said. “We’re not surviving on the brand of another company. We’re building our own brand on no-name ad space, which could be Yahoo!, or it could be Joe’s Home Page.”
The new advertising categories on ValueClick are computers and technology, shopping, sports and recreation, women, arts and humanities, home and family, news, entertainment and media, travel, health, business and finance, education and science, games and automotive.
The question is: Will the new targeting categories result in conversion rates that justify the increased cost per click?
“What we’re doing is providing a thinner slice of our network that is presumably more pre-qualified, and we think that it will lead to increased sales,” Hill said. “It’s up to the media buyer to do an A-B split. They should buy general rotation, buy a category and track them as two different sites. We’ve found that categories are typically more cost effective.”
ValueClick’s network comprises mostly small- to medium-sized sites — everything from personal home pages to business sites — Hill said.
Currently, ValueClick serves between 3.5 million and 4 million ad impressions a day. Major advertisers include Xerox, Infoseek and free e-mail firm Hotmail.
