Spotlight

ADOTAS Conversations: Bill Urschel, CEO, AdECN

Written on
Sep 25, 2006 
Author
Sarah Novotny  |

One of the most discussed strategies in online/interactive today is auction-based advertising. Months ago, ADOTAS published an exclusive byline from Bill Urschel, CEO of AdECN, an auction-based exchange that aims to bring a new kind of stability and revenue-driver to the market. The article in turn created quite a stir amongst our readership, spurring ADOTAS to delve further into the topic and Urschel’s perspective.

Urschel & Co. insist that AdECN and its auction-based model represent the next breed of ad inventory models, one that boasts to be as efficient as the stock market itself. Recently, writer Stephen Bonser met with Bill Urschel in the AdECN offices in Carpinteria, California. The two shared an engaging dialogue that shed light on the background of AdECN, the company’s benefits and inner workings, and how its new approach to inventory can change the way advertising is bought and sold.

What is the mission of AdECN and what are you bringing to the market that is innovative?

AdECN is a real-time, per-impression, auction-based exchange that makes the digital advertising market as efficient as the stock market. To achieve this we have created a computer-based “ECN” or Electronic Communication Exchange, similar to the exchanges that do much of the stock trading today, and applied the concept to online advertising.

The core of the AdECN exchange is a real-time auction for every impression, in which the advertiser can use over a dozen targeting methods. Every time a viewer lands on a web page in the exchange it triggers an auction among all the interested advertisers and in less than 100 milliseconds the highest bid wins and that ad is shown. The advertiser knows what he is getting and he is paying only what it is worth to him. The publisher gets the highest price possible for each impression, and he sells more of his inventory.

A primary benefit to the market is that we create maximum liquidity. Advertisers know what they are buying, and are paying only what it is worth to them. Publishers get the highest price and sell off more of their inventory.

What needs to be improved in the way interactive advertising is bought and sold today and how does AdECN help?

In the opinion of many involved in the online ad industry, liquidity is the biggest problem of bringing true market forces to the trading of ad inventory. Every ad network, even the very best, has transitory supply and demand problems, for example, campaigns that can’t finish because they are ‘capped out’ or inventory that is going unsold because some other campaign ran out of budget.

So, ad networks go looking for someplace to run those campaigns or sell that inventory. They need liquidity, and sometimes they get it, but at too high a price, which wastes advertisers’ dollars, short-sheets publishers, and feeds middlemen who do nothing but pass along deals. A real-time trading exchange solves that liquidity problem.





Sarah Novotny is a contributing editor at Adotas. Sarah grew up in San Jose, California. Her educational and professional career have taken her to both Los Angeles and New York City where she received a B.F.A. from NYU. As a writer, Sarah has free-lanced for various publications focusing primarily on traditional advertising and media reviews. When not writing and editing for Adotas, Sarah is continuing her acting career in various theatrical and film/television productions.

Reader Comments.

As an advertiser I can say I’ve tried the Right media marketplace system and it just does not work. Campaigns convert at a higher conversion when compared to the bigger networks such with 247 and Maxonline. In their marketplace the bulk of the campaigns come from the networks exchanging campaigns with the same publishers. These networks do not have a high level of quality sites. On screen shots I’ve questioned ads showing up on warez sites adult sites and banners stacked one on top of the other. There is no guidance on this marketplace. It is like the wild wild west. Right media looks the other way just to boast the amount of impressions it serves not click rate or conversions. The sad fact is the marketplace is full of low quality sites who accept any low cpm cause they can’t get into the non-Right media networks. The only thing Right media is spawning is huge amounts of nothing sites where illegal downloads of programs, music, and videos are shared. As an advertiser I asked for a site list. Had some hesitance but got a list of sites where my ads would likely appear. When comparing the sites with the site referrers in our logs NONE of the sites were in the referral lists to our sites. There other referrals were from networks use the same marketplace system. I know it is not allowed to post the links to the sites in the comment section but the list would make an advertiser vomit.

On the other hand, I think the adecn is a system that can work. The system looks like it will be impartial and will not be owned by the network that runs it. Over the two I would pick adecn over the Right media marketplace. Whether major sites accept giving their site up to the open market sill remains to be seen. At least they do not try to push off their 2 billion a day impressions through networks recycling the same ads. Pure crap clear and simple.

Posted by Charles Charnel | 3:24 am on September 16, 2006.

Charles,

What campaign did you try? Vizi Media, who is affiliated with Adotas, participates in the Right Media Exchange. Maybe if you worked through the Vizi Direct network, you wouldn’t have had conversion problems. Shame that you only saw bad inventory – great new sites like Tribune, Fox Interactive, Community Connect, LookSmart and Tickle are there. You could always request just to run on those sites that are trusted.

Posted by Adv guru | 1:11 pm on September 16, 2006.

Shit in shit out i say.

Posted by Davey Sprocket | 1:39 pm on September 20, 2006.

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