Let's Automate for the Small Guys

by Tom Hespos, Sep 23, 2003, 12:00 AM

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Any online media planner who has worked with a small client knows about buy minimums. Publishers implement them because it doesn't make financial sense for a sales rep to spend time trying to compete for $5,000 budgets. This makes sense, but it effectively locks out the small business guy who wants to test out online advertising.

If you spend under $5,000 a month or so online, your options are somewhat limited. You can always invest in paid search or online classified ads, but major publishers are likely to turn your business away, unless you want to spend your entire budget or a large chunk of it with one site over the course of a single month.

While it doesn't make sense for sales reps to chase buys of this size, it does make sense to try to find ways to avoid turning the spending away. After all, most of the businesses in the United States are defined as small businesses. If we could find a way for small businesspeople to buy advertising online without having to deal with a sales rep, we could tap into an entirely new market and increase revenues significantly.

Paid search companies have been able to pull this off, mainly due to the simplicity of their product and the way it is priced. Potential advertisers can enter an automated system and bid on search placements using a credit card, if they so desire. Admittedly, a self-serve application for a typical online publisher that sells display advertising would be a complicated thing to execute, but think of the potential for incremental revenue. A publisher might not get $20,000 a month for a year by getting on an online media plan for a big national pizza chain, but might get $500 a month for a year from geotargeted advertising for 40 local pizza places across the country. And wouldn't big pizza chains like Domino's and Pizza Hut be motivated to commit to more online advertising if they knew that they faced competition for the inventory from local pizza joints all around the country?

The trick is finding a way to handle these tiny buys such that staffers aren't going bonkers trying to keep up with the details of each of the campaigns. This would require designing applications that could put the burden of that work on the buyer, rather than on the seller. A group of customer service reps could assist buyers with any problems they might have with purchasing advertising through the system and maintaining their campaigns.

We've been saying for years that the Internet is good for automating complex tasks and making them simpler. Let's put our money where our mouth is and automate the tasks associated with small Internet advertising buys. It could open up a whole new market for online publishers, stimulate competition, and bring online advertising to a whole new group of businesspeople who haven't yet experienced its benefits.

In the U.S., small businesses employ more than half of all private sector employees, create more than 50 percent of nonfarm private GDP, generate anywhere between 60 and 80 percent of net new jobs annually, and pay nearly 45 percent of the total U.S. private payroll. (Statistics from the U.S. Small Business Administration.)

Given that kind of penetration and spending power, isn't it time our industry tapped into this audience of potential clients?

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