As someone who was heavily involved in introducing the theory of CPM (Cost Per Thousand Impressions) to Japanese ad agencies, I've been spending a lot of time recently thinking about what comes next after Google AdSense. Ross tried CPI (Cost Per Influence), trying to come up with an index that included the influence of the blogger or site where the ad was placed. This reminded me of the "branding value" or cluster value argument. Also, the idea would be that an influential blog would trigger a word of mouth diffusion. Anyway, inspired by Ross, John Batelle came up with a really cool idea. He writes about sell side ads where bloggers could copy ads that they saw into their blogs if they liked them. The ads would have information about what sorts of sites they could be posted on and other instructions. They would "phone home" to the advertiser who would pay the blogger for the impressions or clickthrus or whatever. The idea is that it would be viral and publisher driven, rather than advertiser driven. It would be set up so that the advertiser could track which site a blogger copied the ad from so that that they could track the diffusion pattern as well.

Anyway, awesome idea. Lets build it!

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Joi,

This is an interesting idea that, as you say has some strong possibilities. An important consideration for making it real is figuring out how to deal with the advertising budget. As you know, advertising companies (or in-house marketing teams) typically have a fairly fixed budget for a specific campaign (different companies come to that budget in different ways, some smarter, some not so smart). Given this, the challenge of sell-side ads seems to be to provide real time (or near real time) tracking of the ad spend so that the all of the ads automaticlaly expire across the network after the budget is used up. In today's model, where the locations of the ads are somewhat centrally planned, that tracking is easier.

Another issue would be tracking - one of the reasons that advertisers are finally using online media as a major (more than 5% of media spend) channel is the ability th accurately track results. While this meme has been overstated, it is an important aspect of the medium, and should not be lost with the paradigm change.

In summary, to be easily adopted by the advertising companies and marketing teams, the system would need to be able to track impressions across an undetermined and chnaging number of sites, convert that to ad budget dollars and provide tracking data back to the advertiser.

This was an idea that was incorporated into AOL's Digital Cities interface during the late 1990s and was one of the most popular aspects of the personal and local services Digital Cities offered (it was not blogging, but the idea was that people could post information about their hobbies and form local groups, e.g., around jogging or dog training). Users could set their personal page advertisements, specifying what ads from among an inventory could be displayed on their pages—it was organized as categories you could opt out of, so that, for example, I could say "no alcohol ads on my home page."

I worked on this project with John Borthwick of AOL. You should chat him up about it, because I know they thought it worked. The problem was a lack of traffic within the Digital Cities service, not the positive feedback—users writing how much they liked that feature—asking for more ads to choose from. With the critical mass of blogging, this is a service that certainly would be viable.

Very interesting Mitch. I imagine there is some great insight into first sell decisions. But the key facet to me is how portable the format is, going beyond one hop.

Ian, its easy to cap budget spend and track.

Hi Joi

An old meme - Sell Side Advertising - but i've recently did a post "Widgets and Sell Side Advertising"

See http://www.nooked.com/2008/9/5/widgets-and-sell-side-advertising

We've built the platform - and are currently running a beta in the UK

Best Regards
Fergus

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