This is the second article in the Building an Ad Network series. Click here to read part one.
In this post we are going to talk about ways to approach the “chicken and egg” problem of finding publishers and advertisers when you’re first getting started. Specifically recruiting publishers and managing the publisher agreements.
I am going to focus on the type of ad networks that I know best – traditional premium networks that work directly with publishers, serving either all or part of their traffic. These days with exchanges and DSPs you can start and run ad networks without ever talking to a single publisher – this post isn’t going to cover that scenario. (but perhaps a later one will)
Getting Started
You can’t go after advertisers until you have publishers committed to your network – advertisers aren’t going to give you the time of day if they don’t have a good idea of where their ads are going to be running.
In an ideal world you already run a successful, well known, and growing site in the space where you are starting an ad network. This is the ideal scenario because it would mean you have a working knowledge of the sites in your vertical and more importantly, they know who you are too. If this is the case you can get started by simply selling direct advertising on your site to advertisers and then slowly adding in new sites that fit your vertical as you grow demand from your advertisers. In no time you’ll have a flourishing and growing ad network.
If you don’t already have a successful site with advertiser relationships how do you get publishers to join your network?
Commitment
One method is to collect commitments from publishers that will join your network once you have advertisers – this is pretty damn tough since most publishers hear from multiple people a month telling them they can make them more money and 90% of them never deliver. Publishers might also happily commit since it is zero risk to them – then never deliver when you actually sell some campaigns. I look at this as the method of last resort – there are better ways.
Single Spot
One of the most popular methods is to ask the publisher to give you a single spot on their site, 100% devoted to your network. This is popular since it is fairly low risk for the publisher since they are probably just going to add that slot in addition to their current slots. The benefit is that you can easily point advertisers to where their ad will show up – you have legit publishers on your network – and advertisers should take you seriously. The downside is that if it is an extra spot thrown on their site the placement could be bad, it could be next to other ads, and overall could hurt the brand of your network. You will also need to decide what to do with impressions you haven’t sold – you could backfill to another network, serve ads for your network, or pass those impressions back to the publisher. This is the second best of your options.
Passbacks
The best option is to get publishers to put your ad tags on their page and then to let them setup a remainder campaign for any impressions that you don’t fill – when you get started this will be most of the impressions. This gives you access to 100% of the publishers impressions, and even more importantly it gives you first shot at the impressions. This method also makes it very low risk for the publisher – the worst case scenario is that the publisher continues to make what they made in the past. (shameless plug: with some ad servers you would also get additional latency from the pass back, adOS is fast enough that publishers won’t notice this)
Minimum CPMs or Payouts
Some publishers will push for a minimum payout or CPM from you as a network – this can be very effective but obviously has huge risks. You can sometimes work out great deals with publishers where you give them some stability in the amount they make and also give yourself more upside (for instance giving a publisher a fixed $2 CPM but selling it for up to $5-8 CPMs). This can be very effective once you have your network off the ground – when you are getting started it is very risky. If at all possible I would stay away from arrangements like these until you have good advertiser deal flow and are confident you can hit the minimums (otherwise you can be under water very very fast).
So we have covered the methods of adding a publisher – but what about actually getting in contact with the publisher and even starting the conversation?
Brand
The first step is to ensure that you have a web-site of some kind up and running – you need to appear as legitimate as possible. This could even be a simple landing page using a service like KickoffLabs that looks nice, has a good logo, and describes what your network is about. Pay a designer – the $1000 you spend is well worth the investment (most networks don’t need more than a single page site). A large part of being a network is developing a brand – so this isn’t where you want to cut corners and be cheap or wishy washy. You should have a strong statement about what your network represents. Here is what The Deck says in a giant font on their site:
“THE AD NETWORK
OF CREATIVE, WEB AND
DESIGN CULTURE”
You need an equally strong statement that removes any doubt with publishers why you are a good fit for them. They should be honored to be invited to your ad network – if you look even the tiniest bit suspect it will sabotage your efforts.
Approaching Publishers
So you know how you want to on-board publishers, you have a strong site and brand setup. Now you need to actually reach out. The best way is to get in through an introduction – hopefully you know someone who knows someone at the publisher, or you know another vendor that the publisher uses, etc. If you can’t get an introduction then your best bet is a simple email, with a link to your network site, and a realistic estimate of the CPM you feel you can get for them. A 25% conversion rate would be awesome here – so you have to keep at it and invite more publishers then you need. (down the road publishers will be flooding you to join once you are successful).
If you’re well known in the vertical that you’re building a network then you shouldn’t have many problems attracting publishers. For instance, I knew plenty of publishers before I ever started a .NET developer focused ad network. However, when I went to start a network in another vertical I had more trouble. I partnered with someone who helped me on the introduction side and I gave them a cut of the network profit for a period of time. It was a good way to get the network started and worked out well for both of us.
Once you have a number of publishers joining the network you are ready to start selling to advertisers – which will be the focus of Building an Ad Network Pt. 3
How did you get your first publishers? Share your thoughts in the comments.