• by Laurie Sullivan  @lauriesullivan, August 12, 2009

Katz 360 Sales has inked a deal with Rubicon and redesigned its sales model in an effort to provide national advertisers with on-air, online, email and mobile advertising options by embracing "audience buying."

Brian Benedik, Katz 360 Sales president, has been working on the project for more than a year. It will allow the Katz 360 sales team to sell premium display ad inventory and deliver targeted audiences to advertisers across its sites.

When asked whether money traditionally budgeted for legacy radio and TV media has begun to pour online, Benedik admits seeing some of that going on, but thinks many advertisers really want one company to place ads for radio, television, mobile and online.

"We see it as an $8 billion-per-year industry, projected to grow to between $14 billion and $15 billion per year in the next five to six years," he says, citing ThinkEquity stats. "So, I'm going to look during the six months at how the message resonates with the ad community. Do our customers see us as both an on-air and online solution provider?"

Katz, a major traditional radio and television sales rep, created the new sales structure to support the Audience Representation business. It will focus on selling a new class of inventory, called secondary premium display advertising, that is comprised of premium inventory sold by third parties rather than publishers' own sales teams. A dedicated group of Katz 360 Digital salespeople along with more than 350 account executives will sell through the Katz Audience Representation program, effective immediately.

Katz had been embracing the idea of becoming an "audience" rep to support advertisers across multiple channels for years, compared with radio "spot" or "inventory" rep. It's a concept being championed by agencies like Interpublic that want to buy national advertising from one company to target consumers across multiple media, rather than do a piecemeal buy for a time slot or banner ad.

Through the Rubicon onDemand platform, Katz 360's sales team can meet the needs of national advertisers by customizing content and targeting audiences across 40 billion monthly impressions, representing 500 million unique Internet users and 20,000 premium publisher Web sites.

Raleigh Harbour, VP of business development at Rubicon Project, says Rubicon onDemand platform -- an inventory access portal -- provides geographic, contextual, demographic, performance, and behavioral data through partnership with companies like BlueKai. For example, automotive purchase intent information lays on top of impressions from news or radio sites, delivering the data to Katz so they can build it into a custom package to advertisers.

The deal with Rubicon will bring Katz lots of data, as its more than 2,000 national advertisers demand the sales team move from broad demographic targeting to reaching that 25-year-old in the market to buy a car next week. Rubicon has begun to work with data companies to bring the offline data online. Some of that data comes from television and radio, according to Harbour. The cookie data from consumers who opt-in provides information to the ad server that identifies them as a female, age 25, who wants to purchase a new luxury automobile.

Benedik says advertisers want to find that audience. "Bring me that audience and be able to take the best aggregated content from credible publishers, and serve that back to me," he says, describing what advertisers want. After all, Katz not only supports "pretty much the entire terrestrial radio stream community," but online sites, or webcasters, such as Pandora.

Online video ad budgets still dwarf investments in TV ads, according to eMarketer. For every $1 marketers spend on Internet video ads in 2009, they will spend nearly $65 on TV commercials. But online video surpasses the dollars spent per hour of content viewed. The research firm projects that TV advertisers in the U.S. will spend only $0.13 per hour of viewing, while their online video counterparts will spend 38% more, at $0.17 per hour. That imbalance will need to end for marketers to find equivalent value for online video, rather than greater costs.

David Hallerman, senior analyst and author of the report "Digital Video Advertising: Where's the Money?," says that by 2010, the difference between Internet video and TV spend per hour will start to level, suggesting a potential tipping point for online video advertising.