What Slump? Turn Secures $15 M In Funding
Despite a slumping ad market, online ad network Turn has managed to secure another significant round of funding to the tune of $15 million. Turn plans to use the funds to grow its sales and client services.
Turn sees itself as a mid-tier ad network, according to Philip Smolin, the company's vice president of product and marketing.
"The emergence of this mid-tier is very much what we're seeing," Smolin said. "What the newer platforms--like Turn, or some of the behavioral networks--do is create a business class, mid-tier that exists between the two. The CPMs generated in this middle tier tend to be in range of $1-$4."
Led by Focus Ventures, along with past backers, Norwest Venture Partners, Trident Capital, and Shasta Ventures, the San Mateo, Calif.-based Turn has raised a total of $37.5 million.
At least in this case, the trend in spending shifts toward ad networks is trumping the broader forces slowing the industry in general, according to Gartner Research analyst Andrew Frank.
"Money is still shifting online, and the traditional publishing brands are still unprepared, which means a larger share is going to the ad networks," Frank said.
Indeed, ad networks handled nearly 30% of ad sales online in 2007--up from 5% year-over-year, according to a recent study by the Interactive Advertising Bureau. More recently, the volume of ad spending has shifted in the networks' favor from 10% to as much as 30%, according to Frank.
This is despite a recent backlash against ad networks by publishers like Dow Jones and ESPN, who felt the networks were corroding the value of premium advertising.
It doesn't hurt that Turn is part of a new breed of ad networks offering more transparent and targeted services, Frank added.
Turn specializes in so-called "branded response" campaigns for some 500 advertiser clients, which tie their programs directly back to sales. In addition, going beyond behavioral and contextual targeting, Turn uses various criteria to target ads.
According to comScore, Turn is the sixteenth-largest ad network--with a potential reach of 93 million users, and was responsible for 1.9 billion ad impressions in July. Turn's more established rivals include AOL's Advertising.com and Microsoft's DrivePM.
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