Vertical Ad Networks Poised to Take Off

Article ImageThe vertical ad-network model, in which marketers reach readers interested in niche markets, offers a target-rich environment for those with a solid strategy for navigating the world of contextual advertising. When run properly, it provides a setting in which advertisers, content creators, and visitors all stand to gain from their participation. For those marketers not yet sold on the idea, it’s time to take a look—a comScore, Inc. study released April 27 shows that between March 2008 and March 2009, the reach of vertical ad networks grew from 21.5% of the U.S. internet audience to 57.1%.

Although two of the most frequently mentioned vertical ad networks are the lifestyle-focused and travel-focused Travel Ad Network, there are networks for a wide variety of subject matters, such as MTV’s Tribe network or Sportgenic’s Torque network. In May, D&B Digital, the online media unit of Dun & Bradstreet, announced a foray into the market with a platform targeting decision makers; the company will also be building contextual advertising into its and sites.

One of the fastest growing networks is NetShelter Technology Media, which positions itself as a vertical media network versus a vertical ad network, counts 150 independent publishers of tech-related content as part of its network and reaches 50 million unique visitors monthly, according to comScore.

“We have a different kind of media model—our model is really taking that ‘Wisdom of the Crowd’ idea and bringing it to media,” explains Peyman Nilforoush, co-founder and CEO of NetShelter, Inc. “In the old media model, you have editors who are well-known and produce influential content, and that’s essentially how expertise and information were distributed.”

Nilforoush describes the benefit of the open media model as creating an environment in which the whole is greater than the sum of its parts. “Individually our publishers are great, but the aggregation of that information produces much more influential points about trends in tech. So at any given point in time the collective information from these publishers provides a much more thorough look into the tech world for marketers.”

To facilitate NetShelter’s evolution into a media network, the company brought Patrick Houston on board last year as senior vice president of media and chief publisher. Houston, who has previously served as vice president of content and programming at Yahoo!, Inc. and editor-in-chief at CNET, has shifted into a curatorial role of late.

Part of Houston’s job is to walk a fine line—suggesting topics of coverage to publishers without meddling in their direction, as well as helping sponsors to integrate their content in effective and appropriate ways. “Good content can come from anywhere. It can come from experts, most certainly, and we know it can come from users, but we also believe it can come from brands,” says Houston.

“The secret to credibility here—there are two facets to it. One is good and trusted content. The second aspect is transparency. The way you begin to reconcile any concerns about content is to say, ‘This is where it came from,’” explains Houston, who adds that because the NetShelter network is composed of independent publishers, it is inherently self-balancing.

According to John Blossom, president of Shore Communications, Inc., the vertical network model is wide open, and success will be primarily a question of how particular markets adapt it and how quickly marketers learn to make the most of it.

“There have been a lot of early experiments with this and they probably suffered for a lack of focus on contextual advertising by the marketers. Glossies were the meat and potatoes for marketers and it’s only been fairly recently that we’re seeing the shift into web-first advertising,” says Blossom.

“The core of it is, ‘OK, this is a totally new marketplace, so if I don’t harness it, what happens?’ If I’m not getting into this ecosystem and finding a way to integrate my brand, that means that I’m becoming less and less relevant every day because I’m playing it old school while my audience is being influenced by the wisdom of the crowds,” explains Nilforoush.

“There is a potential for backlash in that traditional publishers pride themselves in having a creative ad sales team that knows their market best. Those techniques are valid, but it’s hard to take advantage of the fleeting value of content in an online environment,” says Blossom. “Matching ad inventory electronically is a much more effective way of getting value out of all of your inventory, past and present; to get fresh ad value out of old content as well as get value out of current content.”