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Apr 21, 2008

NEWS: Trade Publishers Ally for Ad Net

Cygnus, Nielsen, Reed and McGraw-Hill are providing inventory to BBN

NEW YORK The proliferation of online ad networks is spreading to the business-to-business space.

Four trade publishing companies are joining forces on a new online ad network that promises to reach 10 million users per month on trade publication Web sites. The network intends to sell to brand marketers normally outside the scope of trade advertisers.

Cygnus Business Media, Nielsen Business Media (which includes Adweek, Reed Elsevier and The McGraw-Hill Cos. are providing inventory to BBN, which will package it together to give advertisers greater reach, including 6 million small business owners, according to BBN estimates. Publications represented by the network include Aviation Week & Defense TechnologyConstruction Equipment and CPA Technology Advisor.

Derek Reisfield, a former CBS executive and founder of MarketWatch, said the scale of combining the parent companies' hundreds of trade periodicals would enable them to tap advertiser budgets previously unavailable to them through their own sales forces.

"It will attract people into the B-to-B category that, for a variety of reasons, didn't feel it provides a solution for them," he said. "We now have a broad reach net with an attractive audience."

Ad networks have become a popular solution to a main challenge of Web advertising: the inability to make efficient buys when audiences are scattered across thousands of sites. In addition to broad-reach networks like Google's AdSense and AOL's Advertising.com, several targeted networks have begun focusing on brand advertising.

BBN will operate as a standalone entity without the publishing companies holding stakes. WPP Group's 24/7 Real Media is providing the technology underpinning the ad network, including ad-serving and campaign management. Resfield said BBN hopes to have a dozen salespeople within two years.

The venture comes as trade publishers, like other traditional media, look for new ways to produce revenue in the face of declining print advertising and fragmenting online audiences. Nielsen Business Media has made staff cuts recently, and Reed Elsevier said it would sell its business-publishing unit.

"What's happening is the nature and power of the distribution channel is changing very radically," said Reisfield. "You're going from a world where everything was driven by economics of physical distribution where you had to bundle to get efficiency. That bundle is becoming undone. The question is how you bundle it back together."

BBN will consult with the publishing companies to come up with advertisers it won't pitch for campaigns to avoid channel conflict, he said. The targets for BBN will tend to fall into a small-business-focused push for American Express that previously would not include a trade component, he added. Financial services and technology are other target areas.

"We're about bringing money into B-to-B, not changing the allocation among B-to-B ad buys," Reisfield said. "We're talking about money not spent in B-to-B." 
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