No more stupid scam ads: firm replaces junky banners with branded content

People are fed up with obnoxious internet ads that promise “weird tricks” for flat bellies. These ads, which deliver no value to publishers or consumers, have led some to declare that it’s time to do away with the banner ad format altogether. Others call for a less radical solution and say the problem is not the ad format but the content.

OneSpot is in the latter camp. The Texas-based ad firm, which has clients like Dell (s dell) and Home Depot (s hd), believes the banner ad problem can be fixed and points to its easy-to-use technology as a way to do so. In a nutshell, OneSpot offers a rapid way for brands to create ads from pre-existing content — reviews, white papers, slides and so on — and display them in high value settings for a good price through the help of ad exchanges.

In practice, this might mean that an ice cream chain selects a piece of content it controls — perhaps a company blog post or a video or a newspaper review. With the help of OneSpot, the ice cream chain zaps that content into the form of an ad and place it on sites where ice cream fans are likely to be. The advantage of this approach, rather than randomly spraying an ad around the internet, is that target customers are likely to engage with the advertiser because the ad is content they care about.

To explain it another way, OneSpot’s method lets brands take advantage of the fact that many online ad slots are now being filled with dirt cheap junk like this…

Banner ad screenshot 2012-12-04 at 11.02.18 AM

.. and replace them with quality ads for a low price. Here is an example of the OneSpot approach, where a piece of content called “Desert Survival” has been packaged into an ad — the advertiser, hoping that Outside readers will be interested in the content, has paid to place it (through an automated ad exchange) on the top right of the Outside page:

One Spot screenshot

One big upside to this approach for advertisers is the chance to hand over the task of ad buying to OneSpot. Doing so spares them the dizzying task of working with ad exchanges to place the ad content themselves. OneSpot also gives advertisers a way to keep tabs on their campaign with real-time analytics; the advertisers can employ A/B testing to tweak their campaigns and measure ROI.

While there are a flurry of companies making big claims about changing the ad game, OneSpot appears to be the real deal. It has been working with major retailer clients since March and received $1.5 million in funding from investors that include RSL Venture Partners and 500 StartupsI sat down last week with founder and CEO, Matt Cohen, who explained his view on the ad industry:

“Advertising is a business model, not a type of content … It’s when one party buys attention from another,” Cohen said, arguing that “interruptive content” fails and leads to banner blindness.

The most intriguing aspect of Cohen’s model is that it appears to be a hybrid of bespoke “native advertising” which is being hailed as the way of the future, and the existing display advertising business that is still popular because it scales so easily. OneSpot-served ads also come with Twitter and Facebook (s fb) buttons that make them easier to share (another increasingly essential element of online marketing).

If the OneSpot model catches on, it will increase pressure on advertisers to find quality content and, at the same time, benefit writers and other content creators.  It may also reinvigorate the sagging display ad market by replacing worthless “lose your belly” ads with more valuable ad content.