And it's also surprising, given the push for open-platform, friction-less ad buying, that the new self-service ad service I'm talking about -- called MyAds -- came out of MySpace. Not that MySpace hasn't been trying to crack the code of monetizing its zillions of pages of inventory just like anyone else, but, sheesh, you would have thought that Google or Yahoo or Spot Runner would get there first, particularly since MySpace has been beating the drums about the arrival of this service for almost a year -- plenty of time for a few Google engineers to rain on MySpace's parade and gin something like this up for Google's advertising network.
For those who didn't see the news on Monday, here's a quick recap: Using MyAds is a four-step process that can be viewed at https://advertise.myspace.com. Prospective advertisers create display ads off of a template, target their audience, pick the flight of the ad and their budget (the range is between $25 and $10,000), and monitor performance.
Ads are priced on a cost-per-click basis, with a minimum cost of 25 cents per click. Much of MySpace's imagination concerning who might use this service centers around musicians, which is as it should be, particularly with the recent launch of MySpace Music. (MyAds is also meant for entrepreneurs, politicians and the like.)
The linchpin of MyAds is MySpace's HyperTargeting technology, which leverages user profile data that users have agreed to display publicly to slice target markets into ever smaller niches -- in MyAds' case, about 1,100 of them so far. Having such narrowly defined audiences, of course, is about the only way that smaller advertisers can play with the big boys. If online advertising was all about reach and frequency, the medium would be entirely ruled by the same cast of usual suspects that populate network TV, so it's always refreshing to see ways that smaller advertisers can play on a somewhat leveled field with the behemoths.
But how will all this play out, in terms of helping those advertisers and providing an ad revenue boost to MySpace? I'm curious to find out, while at the same time figuring it's impossible to say. (For the record, a MySpace spokesperson said that while MyAds was in stealth beta mode, "MyAds performance blew doors off daily revenue goals within the first week.")
On the down side, we all know that ads and social networking haven't been considered a match made in heaven, since people on social networking sites don't seem to be searching for much most of the time except for other people. On the other hand, a platform like MyAds is tapping into a revenue stream that is relatively untapped, since text ads have been the default online advertising format for most small to medium-sized businesses. In addition, an automated system not only brings convenience to advertisers, but economies of scale to those who provide them. Rolling out something like this, for MySpace, is a no-brainer.
I still have many questions for MySpace about MyAds, but since the company hasn't met my deadline, I'll throw them out to the Social Media Insider readership. How would you answer these?
1) What revenue will MySpace generate from this program (either as raw number or percentage of overall MySpace revenue)?
2) What is the range for anticipated click-through rates?
3) Why is it being priced on a cost-per-click basis, as opposed to other performance metrics? (I think the answer to this is that it makes participation less risky for advertisers. If you have your own theory, please elaborate in comments.)
4) If this works, is MySpace considering rolling out the MyAds platform to other properties, both within Fox Interactive Media and outside of it?
OK, everyone ... have at it. Let's answer the questions above and tell MySpace how we think MyAds will do.