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Paid Placements

Paid Placements

February 15, 2010
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" I’m already seeing many more strategic partnerships between site owners and prime affiliates, especially in a time when a lot of the big program owners are starting to shift the focus away from affiliates "

After an eight year run, the deal between Bing and Yahoo has signaled the end of the lucrative Yahoo Search Submit Pro (Y!SSP) inclusion program. Simultaneously, an increasingly large number of affiliates are being squeezed out of the adult market and in-house traffic generation has become the primary focus of many successful content owners.

Anyone who attended the recent ad:tech show in New York saw a glut of companies hawking PPC marketing and ad spot tracking services.

A range of different software packages and outsourced consulting solutions suggested that the online paid placement segment of digital marketing is alive and well.

With so many interested players and such game-changing forces affecting the segment, XBIZ sat down with paid placement experts to determine the future of adult ad spots.

“We’re one of the largest resellers of Yahoo Search Submit Pro (Y!SSP) and certainly the largest one that handles adult content,” Wildline! President Charles Hentrich said. “We’re obviously not thrilled with Yahoo’s decision to terminate the program because there is no direct substitute for Y!SSP. It has been a fantastic traffic channel for the advertisers who were participating in it, but it’s a widely misunderstood product. Essentially Y!SSP is just SEO on steroids with data feeds instead of web pages.”

Contrary to a popular misunderstanding, Y!SSP buyers were not paying for rank — they were paying for inclusion and for the opportunity to control the content which was included. That meant that someone with an understanding of SEO could programmatically optimize the included content, so not surprisingly it usually tended to rank very well.

On the heels of the announcement to scrap the Y!SSP program, Wildline! has decided to broaden its approach.

“Our plan is to bring white hat SEO to the adult space. SEO is the best and most logical place to focus,” Hentrich said. “The Y!SSP search traffic in Yahoo will remain there after SSP goes away, but the search results will be different.”

Traditional SEO methods require significant resources due to the simple fact that it is a competitive field. Often the resource in shortest supply is time. Dismantling SEO tactics and eliminating quick shortcuts for acquiring rank are now high priorities of the billion dollar companies that manage the dominant search engines.

Ask any competent SEO practitioner what went wrong with a particular client and the answer is almost invariably that the customer agreed to a longterm plan and pulled the plug before meaningful traction could be established. The changing landscape of paid placement may now be radically altering the timeline and mindset of many adult business owners.

“Our clients will put in the time,” Hentrich said. “I think many of the short-sighted players have already been shaken out. The adult industry is maturing and as a natural part of that maturation process, smaller players are being rolled up by the bigger ones. There’s more of a barrier to entry now than ever and the bad players are failing. It’s sort of a gentrification of the adult industry’s neighborhood and the smart players in adult are looking at handling marketing in a much more, ahem ... mature way. A lot of the guys who have been in the space since the late 1990s have built a significant brand and are no longer comfortable with allowing novice affiliates to market their brand, especially in the search arena.”

“There had been talk for a long time that Yahoo was ending its paid inclusion program, but I think when it was confirmed, everyone was still a bit shocked about it,” said Ross of PIMPROLL. “We did very well over the last five years or so with Y!SSP. It’s another good source of traffic gone as of the end of this year and it’s something I know a lot of companies are dreading. Some smaller companies live on those types of sales: low cost and long recurring. The change may put many of them under considerable financial strain.”

Compounding the impact of Y!SSP being shut down, many traditional paid traffic spots available from affiliates are changing as well.

“This past year the major trend has been old, well-established TGPs and MGPs slowly dying off,” Ross added. “In their place, new tubes are popping up everywhere. While many of these older established sites have tried for a long time to fight off the temptation of turning into tubes, I really think in early 2010 we will see them jumping ship. Today it’s the only way for them to survive. They get a tube set up and start throwing up pre-paid ads.”

“I’m already seeing many more strategic partnerships between site owners and prime affiliates, especially in a time when a lot of the big program owners are starting to shift the focus away from affiliates,” Becky of Adult Revenue Service offered.

“In some cases, it’s the program owner misunderstanding the market. Some think affiliates are useless when in reality it’s their own site portfolio that is useless. We are working on a new experimental system that will make the entire affiliate marketing process more clearly defined and easier to manage.

“Professional affiliates still have a vital role in the success of the adult Internet business, but that role is changing and the relationship between sponsors and affiliates is evolving as well,” Becky added. “At the end of the day, affiliate marketing is a particular form of paid advertising that has become misunderstood by many affiliates and sponsors. Getting that collaboration to work more efficiently is a key part of the puzzle when piecing together the future of paid placements.”

For some, the shrinking number of players and emergence of a professional tier of traffic sellers has been a welcome advancement. “We have explored many angles of the adult ad placement market while growing the High Society brand and providing adult entertainers with a way to reach the high class clientele they seek,” Jonathan Maldini of HighSociety.com said. “The escort and adult directory niche offers unique challenges in terms of traffic procurement when compared to other adult categories making AdWords or similar PPC options less attractive.

“We continue to explore all possibilities and are open to any avenues that can provide quality traffic at reasonable prices,” Maldini added. “For a long while many paid ad spot services and websites seemed to rely on finding new webmasters who are susceptible to tricks and scams rather than focusing on actually building traffic networks worth working with from a sponsor’s perspective.

“I think that is starting to change,” Maldini concluded. “As less newbies enter the industry the approach of cycling through many novice ad buyers and ripping people off is being replaced by professional traffic networks that are capable of providing the metrics they promise with clearly identifiable results.”

“I would advise someone buying an ad spot for the first time to be very cautious and leverage your network of colleagues to learn as much as you can about the publisher before agreeing to anything,” Brad Estes of Video Secrets said. “Further, you should plan and budget your tests thoughtfully making sure you give both enough time and money to the test to make your results as scientific as possible.

“We always try to resist the urge to bring on too many new publishers at once, ensuring we have adequate resources to monitor and adapt campaigns during the ever important testing phase,” Estes added. “I hope to see more standardization in terms of pricing (and what the pricing is based on) in the coming year.”

While a lot of the talk always seems to center around traffic, it should be noted that increases in traffic do not always result in greater sales volume. Put simply, successful merchants aren’t really looking for more browsers, what they want are more buyers.

“The average CTR on banners and text ads is way down compared to where things were just two years ago, much less 10 or 12 years ago,” Quentin of TopBucks.com said. “The way to combat that lack of response is to embed advertising in the content itself, like ads that play before the start of a video or right in the middle of it.”

“Advertising embedded in content in such a way is hard to avoid,” Quentin offered. “We’re seeing major expansion in the use of this approach already, primarily on the mainstream side of things, but I think adult advertisers will follow suit despite concerns that consumers will not like this method of advertising. If people want free content, there has to be some other manner of return on investment for the producers who provide that content.”

Another interesting perspective came from Clement of VideosZ who has been a large buyer of online ads for nearly a decade.

“To me the biggest change has been how many sites are up for sale these days. As so many sites quietly change hands, the deals made with a former owner for a long-term ad buy often gets forgotten,” Clement stated. “Acquiring paid links or banner spots may seem less expensive than it used to be, but it has also become riskier and more expensive in many ways. You used to be fairly certain if you bought a banner for a year on a site that the banner would still be up on that site 11 months later. Now, unless you have a strong relationship with the seller it’s hard to consider ad spots on more than a monthly basis.

“That makes the entire market much more volatile, as buyers try to chase traffic in the short-term instead of formulating a long-term plan — and it costs more in the end due to higher monthly renewal prices and less sites worth buying long-term deals from,” Clement added. “I think social networks will augment traffic we’re already enjoying from traditional search engines and paid traffic providers — but the only sure thing these days is the traffic that you can supply yourself.”


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