• by Gavin O'Malley  @mp_gavin, April 25, 2007

TargetSpot, a startup that allows businesses and individuals to create, buy and place Web radio ads, has received funding from Union Square Ventures, CBS Radio, and avatar tech company Oddcast.

"TargetSpot is to Web radio what AdSense was to online publishers," declared the company's founder and CEO Doug Perlson. Perlson, however, would not say how much investment he is receiving from his new partners.

Involved since the inception of the startup, CBS Radio plans to use TargetSpot's technology on its more than 100 music, talk, sports and news radio stations broadcasting live online.

"Advertising in streaming media isn't like putting up a banner ad on a Web page, which is where the technology was when we conceived the idea for TargetSpot," said Dan Mason, president and CEO of CBS Radio. "The technology, among the purest forms of business-to-business advertising, is specifically designed for monetizing streaming audio and video."

There is certainly a market for online radio listeners, say analysts.

"Our data indicates that 26% of online consumers were listening to online radio last year," said Forrester Research analyst Charlene Li. "That's a good number of people to market to." The U.S. adult Web radio audience amounts to over 50 million listeners, according to eMarketer.

"The main barrier to success for any company will be getting the attention of marketers," added Li. "The involvement of CBS should help TargetSpot in that respect."

TargetSpot ad formats range from audio, video, banner and text ads using various jingles, sound effects and visuals provided by TargetSpot. Clients can also upload their current creative directly into their Web account. Ads are then targeted to a specific demographic, location and/or property. Campaign costs vary with advertising revenue being shared among TargetSpot and the participating broadcaster.

Before launching TargetSpot, Perlson most recently served as chief operating officer of online ad network Seevast--formerly known as Kanoodle.

"Until now, most local advertisers have largely been limited to yellow pages, inserts, direct mail and weekly newspapers," added Perlson. "Because of production costs and an inability to properly target their advertisements to local audiences and programming, audio and video advertising has never been an option."