Brand advertising growth has slowed down online, but the weakening economy is just one factor, according to Jim Spanfeller, CEO of Forbes.com. During a keynote interview with senior analyst Mark May at the Needham Internet and Digital Media Conference, Spanfeller attributed the lower growth rates to size and maturity, as well as a failure of quality supply to keep up with demand — hence the interest in non-traditional, direct marketing efforts: “There’s been a lot of money pushed onto the web… and as that’s happened, the facilities to place that money have basically been overwhelmed — and what that has done has push a lot of the money into performance-based ad networks.” But Spanfeller expects that particular issue to be short-lived.
– CPM compression: CPMs have softened lately, but he attributes it, in part, to an increase in supply (yep, prices online are governed by supply and demand, just like in the real world). But it’s not necessarily a long-term issue: “I think if anything it will be maybe a two-year process… but a gradual process. I don’t think you’ll see the type of deflation you’ll see in 2000-2003.” One difference between the current state of the economy and the last swoon: “The mainstream advertisers were not convinced and the online advertisers were gone.”
– Maginot Line: On WSJ.com: “For better or for worse, the Journal is already free. They’re trying to have their cake and eat it too and they’ll succeed in that for some period of time, but you can get any story in the Journal for free right now if you go through any search engine.” Spanfeller thinks it’s the right move: “A full-on Maginot Line of defense around the print product would probably be as effective as the Maginot Line.” More after the jump.
Forbes.com IPO: When Forbes.com was established as a unique entity within Forbes, it was done with an eye towards an IPO. But, said Spanfeller, the Forbes family was a week late in getting in the papers — and then the bubble popped. So could it happen again, especially in light of Elevation’s investment in the site: “It’s definitely a consideration.” He added that he’d be the 28th or 29th person to have a say in this question. As for the size of Forbes.com revenue-wise, Spanfeller didn’t bite.
– Long-tail supply and the Forbes ad net: “The blogosphere is an interesting place… it’s certainly going to be with us for a long time.” He didn’t really acknowledge whether this was a threat to Forbes; instead focusing on the opportunity Forbes.com is trying to seize with its own recently announced business and finance blog network.” The network now encompasses between 650-700 blogs, which are regularly curated and monitored by Forbes editors to ensure that they’re “clean, well-lit” places.
– Audience measurement: Always a hot button topic. Spanfeller didn’t seem overly concerned, noting that anyone company with a large marketing budget already has metrics that they know and that work for them. But, for advertisers looking to move spend from TV to online, the lack of good data is a problem. One glaring issue: online business readers are underrepresented in samples for various reasons.
– Video: It will be big and commands premium CPMs, but producers need to get beyond reproducing TV.