Why all the mergers and acquisitions in advertsing and in online market research? Yahoo, Google, MSN, and Nielsen are all involved in recent Mergers. The answer is more money can be generated from expanding networks of advertising and using predictive data about online buying and online buzz marketing. The advertising exchanges give publishers more options for targeting customers.
Yahoo paid $680 million to acquire the other 80% of Right Media. Click Z reports that Yahoo will: " run the exchange (Right Media) as an independent operation as part of its advertising and publisher group. The Web portal also will employ the exchange to sell display ads across its own site as well as affiliate sites in its search ad network and the growing consortium of newspaper publisher sites the firm has aligned with. In addition, Yahoo will employ the exchange for the display ads it provides on Ebay." So Right Media helps Yahoo sell display ads and provide greater connections with other aligned companies like newspaper publishers and Ebay. The Right Media exchange is an advertising auction run in real time. About 1000 publishers use the 4 year old Right Media exchange.
Eventually Yahoo will use behavioral targeting to connects advertisers with particular segments on the excahnge. These ads sell for more money. Brandweek explained that Yahoo is moving toward more behavioral targeting: "Nineteen of the top 20 consumer packaged goods companies use a four-year-old Yahoo! service called Consumer Direct that employs Nielsen's HomeScan unit to monitor the online behavior and purchases of 46,000 consumers, .... Yahoo! monitors the online activity of Consumer Direct users. Cara said Yahoo! looks at thousands of data points including sites visited and time spent online to compile a user profile. Yahoo! then uses findings from that sample to target its 477 million monthly visitors." This data then helps build predictive models of advertising and buying behavior from the smaller sample of 46,000 to the larger population of 477 million. As the predictive models improve, companies find that their advertising has more impact.
Google paid $3.1 billion to obtain DoubleClick. Double Click specializes in display ads and is developing an advertsing auction exchange. The DART sysytem used by Double Click has about 1500 clients. Here is how Carol Krol described DART: "Founded in 1995 and originally called Internet Advertising Network, DoubleClick serves as the middleman between marketers and publishers in the online ad marketplace. Its product line, known as DART, enables agencies, marketers and media companies to target, deliver and track online advertising. It boasts more than 1,500 clients and handles ad serving for display ads, rich media ads, affiliate marketing and, more recently, search marketing."
The New York Post reports Microsoft or the WPP Group want to buy 24/7 Real Media for $1 billion. 24/7 offers a Global Web Alliance of over 1,500 companies. 24/7 has been doing behavioral targeting since 2004, and has added geotargeting with zip codes to its services. 24/7's recent partnership with Dentsu in Japan adds to their attactiveness.
In related news, Nielsen acquired the remaining part of BuzzMetrics and will buy NetRatings.