Interview: Andy Ellenthal, CEO Of quadrantONE, On The Alliance’s Move Beyond Newspapers

imageThe national online ad sales alliance quadrantONE, long an ad network for newspapers, is slowly branching out. Recently, it signed up D.C.-focused news site Politico as its latest member. The deal only covers the Politico site itself, and not its 60-member ad network. While Politico technically operates a small newspaper — it’s free with a circ of about 25,000 in the Capitol Hill area and comes out three days a week when Congress is in session — the addition of the site to its client roster is seen as a way of quadrantONE broadening its reach beyond traditional dailies.

I talked with Andy Ellenthal, the former DoubleClick exec who became quadrantONE’s CEO nearly a year ago, about the move beyond newspaper websites, why some people still confuse quadrantONE with the Yahoo (NSDQ: YHOO) Newspaper Consortium, and how the latter half of this year is looking for the ad-sales alliance. The Q&A begins after the jump

paidContent: Yahoo’s alliance is more about driving a two-way flow of local and national online content and ad sales. quadrantONE has always tried to position itself as strictly national in terms of ad sales. Does the introduction of Politico and its newspaper sites heighten or soften that position?

Ellenthal: The reason we exist is to pull the content together in a way that’s appealing for national advertisers. We’re competing on the national level against Yahoo News and CNN. That’s where Politico adds an extra layer of content and greater attractiveness for users and national advertisers. We do kind of get bucketed into this local ad sales playing field — and we will do spot buys if an insurance company, for example, wants the 25 top markets. But we want to be competitive across the entire national platform. Everything else is extra.

PC: The company opened its doors in February 2008 and you came on in July. Even though you don’t have much to compare it to, how have been affected by the pullback in ad spending?

AE: If I had a five-year track record, things might look differently. The reality is, we’ve had this platform turned on for a year and our salesforce has been around in a full capacity only since Q3. So every month is actually an improvement. Even the auto advertisers, which includes General Motors and Ford, continue to be one of our largest categories, along with retail, travel, insurance and casual dining. Packaged goods in an area that we expect to grow, despite the lingering recession. We want to be in a position where we have a good blend of advertisers and where we’re not overly dependent on one or even a small handful of categories.

In August and September, financial services was looking like that was going to be a particularly important area for us. But with the collapse of the financial markets last year, that quickly turned south. If we had been betting solely on that, that could have been a problem. But we never went that route. Still, we do want to be ready for when the financial sector comes back.

PC: The companies that helped create quadrantONE — Tribune Company, Gannett (NYSE: GCI), Hearst Newspapers and NYTCo (NYSE: NYT) — have spent the past year making deep spending cuts. Have the challenges affecting those companies begun to impact quadrantONE?

AE: I can’t talk about the company’s financials, but being small — we employ fewer than 30 staffers — certainly helps. As far as our backers are concerned, right now, it’s about demonstrating traction in the marketplace and bringing new advertisers to our affiliates. We are self-sufficient in so many ways and we’re not dependent on someone else’s services to operate our business. That said, we have no plans to hire additional staff until at least 2010. We had been doing a fair bit of hiring up to this point. But it’s not just the economy; I never liked to hire after June anyway. It’s hard to take in employees as you get into Q3 and Q4, as things get busier and it’s harder to make sure people get absorbed into the company in the best way. And we’re pretty set right now as it is.