We have discussed the impact of closing the ad loop with regards to one of the biggest brands in the world, Coca-Cola, and how they ensure interest in an ad campaign that generates a search ties online ads with the offline campaign.

In other words, people receive reinforcement of the campaign message at all points on this “closed loop” of advertising. Think about Coke ads and tie-ins seen with hit show American Idol as an example. If someone sees this offline, an online search for Coke and the show should reflect what drove the person to the search.

Fred Wilson cited an additional argument in favor of closing the loop effectively. ComScore president and CEO Magid Abraham has an article at the Harvard Business Review about a study his firm did for one client to see how the client’s online ads impacted its mostly-offline, real world sales.

“Over a three-month period, U.S. sales increased by 40% online and by 50% off-line among people exposed to an online search- and display-ad holiday campaign promoting the entire company,” said Abraham of the unnamed client.

“Because its baseline sales volumes are greater in physical stores than on the internet, this retailer derived a great deal more revenue benefit off-line than the percentages suggest.”

Not everyone has the marketing reach of Coke, nor the unnamed $15 billion in revenue retailer, either. But with contextual advertising available to anyone who wants to bid for keywords, it makes sense to tie some keywords together when they represent what someone will see in a sign or hear on a radio ad.

The ROI could be impressive.

Adobe, Yahoo Testing PDF Ad Service

PDF has been an appealing format due to its ability to preserve the look and feel of a document, while providing it to others in an easily accessible way. The free Adobe Reader became a fixture on computer desktops as adoption of PDF increased.

Yahoo has managed to score a significant win by beating ad competitors like Google and Microsoft to the opportunity to mine the PDF space for advertising revenue. Adobe and Yahoo announced the new program for delivering dynamic contextual ads in PDFs this morning.

The opt-in program pulls ads from Yahoo’s network to place in a panel next to the PDF content. Each time the PDF is opened, the ads will be refreshed to keep timely and relevant ones in place.

Publishers gain the ability to track their ad performance in the PDFs. Yahoo Publisher Network senior VP Todd Teresi called this a "previously untapped opportunity" for advertisers to gain exposure, and publishers to derive revenue from these documents.

The program picked up some big name participants for this initial beta. CondeNast’s Wired, IDG InfoWorld, and Reed Elsevier were among those named in a statement from Adobe.

To participate, publishers register and then upload their PDFs so the ad functionality can be enabled for the document. After that has been completed, the publisher distributes the PDF as usual.

InfoWorld’s participation is of particular interest. The long-time trade journal scrapped its print magazine in opting for an online-only, ad-supported presence. If profitable, we expect to see other print publishers express interest in trying out the program.

Another interesting possibility comes to mind with the PDF advertising. The hot Amazon Kindle electronic book reader has the capability to pick up PDF content, a feature Amazon currently lists as being experimental in its ability to convert them for readability.

If Amazon works out PDF conversions, the EVDO network supporting wireless content delivery to Kindle could work as a conduit for the PDF ad program too. Since Amazon has its own interest in delivering ads, there could be issues with this idea, however.

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The program is currently in a pilot phase with 10 “enthusiast” segments with some select advertisers, and will be available broadly this fall other segments. Also, in November, MySpace will launch a self-serve online ad system to allow smaller companies to aim at MySpace users with their ads.

They expect the advertising to jump 80% in click-through rate, while doubling their monthly revenues (to $80m).

They did not explain why they did not choose an extant contextual advertising platform, but it’s likely that they’d profit more from a home-grown solution.

The move appears to be one of the most drastic advertising methods used by a major social network yet. Although Facebook announced plans for targeted advertising last month, their plan did not include putting ads on members’ profiles (at least not as described by the Wall Street Journal, which clearly stated that they would be in News Feeds, not the “Mini-Feeds” featured on members’ profiles).

So keep your eyes peeled for advertising on your favorite social network, whatever that may be, and let us know if you think they get it right.

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Contextual advertising in the Russian market has boiled down to a couple of players: Yandex, which provided an assessment of such ads in Russia, and Begun.

Yandex claimed it has between 55 and 60 percent of the contextual ad market, based on revenue. Begun followed that with 30 to 35 percent. Everyone else, including Google’s AdWords, is chasing the leftovers.

The bigger ongoing ad budgets come from construction, car dealerships, and firms in the business to business segments of the economy, according to Yandex.

Those budgets aren’t huge in number yet, totalling only $210 million. But they have doubled year after year since 2005, showing a growing acceptance of contextual advertising by Russian companies. Their advertisements have been displayed to viewers about 140 million times per day on weekdays, Yandex said.

Product #1 is, in this case, Google AdSense.  Comm led a session called “Contextual Advertising Options: Clicks Equal Cash,” and first mentioned the massive amount of money flowing through AdSense – an estimated $14 billion this year.  The author of “The AdSense Code” then complimented AdSense’s design and video ads.

Yet Google’s not perfect.  Comm, whose ClassicGames.com was sold and is now called Yahoo Games, is concerned about unknown payout percentages, Made for AdSense sites, and accounts being closed for invalid clicks, so he moved on to discuss the Yahoo Publisher Network (YPN).

Comm recommends using YPN if you are banned from AdSense, if your AdSense click-through rate is low on a page, or if your YPN earnings per click are higher.  Otherwise, well . . . he prefers ol’ Google.

One more option, however, is Chitika.  Comm notes associations between Chitika, Shopping.com, and PriceRunner, and thinks that people should consider using the service if their pages are product-related.  He also gives fair warning that some family-friendly sites have been provided with porn links, though Chitika has recently conquered this problem.

So there you have it.  Good luck with your comparison shopping.

The contextual product is integrated into the Ask Sponsored Listings (ASL) platform and allows ASL advertisers to seamlessly extend their pay per click advertising campaigns to content pages. Reaching over 34 million unique users each month, the ASL content advertising network will launch with sites from IAC’s portfolio of brands including Match.com, Ticketmaster, Evite and Citysearch.

Ask has obviously completed a lot of research on existing contextual ad offerings as they’re promising enhanced customization for  publishers.

• Customization of ad look and feel (background color, font, layout, graphics)
• Customizable relevancy settings to meet user experience goals
• Editorial control of advertisers (competitive advertiser blocking)
• Editorial categorization of site pages is supported

“We’re trying to solve the full equation for advertisers and publishers. Advertisers can expand their existing Ask Sponsored Listings campaigns with the same features, function, and control when they target the content network. For publishers, we’ve tried to differentiate it from what’s out there. We’ve talked to lots of publishers, including some IAC brands, to get a sense of what they’re looking for,” said Paul Vallez, head of Ask.com’s search marketing product division.

ClickZ reports the product will initially role out to mid-size publishers in May with a self-serve model coming later this year.

So, what’s a “mid size” publisher? This is the area that Ask is trying to muscle-in on, but what exactly does a mid-size publisher look like, anyone care to speculate?

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Ask Enters Contextual Ad Space

We chatted with IAC’s James Speer, GM for Search Marketing, ahead of today’s announcement. Ask will extend its ASL program to pay per click, contextual ad units to be displayed on publisher websites. For now, those sites will be ones in the IAC family, like Match.com and TicketMaster.

Speer said the same sort of bid structure will be in place for contextual ads just as it is for search advertising. The existing management tools ASL clients use will allow those customers to break out the contextual reports and see their performance.

Contextual advertising gives Ask and IAC more diversity in what they can offer to marketers. Speer was not ready to discuss the new product in terms of interest from potential third party publishers, though they will have more news in the future.

He also suggested watching their search advertising growth for hints as to where they are going. ASL started two years ago, and has grown to reach 34 million unique users per month.

We were interested in ad relevancy with the new contextual product. Yahoo has made a lot of noise about ad relevance in their new search advertising system, moving from a bid price-first approach to one that weights quality more heavily.

On Ask’s contextual product, Speer said: "From a publisher perspective, they have a lot more control." Publishers will be able to tune what their sites display on a relevancy basis. A site publisher can choose to show the most highly relevant ads.

This permits the site publisher to maintain a quality user experience, according to Speer. He cited Match.com, an online dating site under IAC, as one that’s going to demand its ad experience stays in line with what users expect.

Clients will be able to customize the yield thresholds and manage their page yields, to help weight their ad displays by what ads pay or by their relevance.

Ad customization for look and feel, and editorial categorization of site pages, will also be among the enhanced editorial control Ask plans to offer with the new service. It will be a few weeks before the contextual product becomes available. Ask cited the week of May 21st as the time it will debut.

Shopping sites like Shopping.com, Yahoo! Shopping, BizRate, and NextTag already dominate Google’s organic search results and paid listings.

Ask.com just announced their contextual ad network.

Amazon.com just had a solid quarter, and is selling ads directly via ClickRiver.

Why are ads on Wikipedia unthinkable? Because Jimmy Wales is gathering authority and content, waiting for his search project to launch. Don’t be surprised if the Wikipedia contains ads soon after Wikisaria’s ad program launches.

How many ad networks will online marketers be willing to sign up for?

If you think the web is full of spam now, wait until you see what it looks like when all the large brands put ads in the content, and when shady publishers have a dozen different distributed ad networks to chose from.

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While it’s true that Y!&Goog would benefit from better sites joining their networks, I agree with Seth that being so afraid to show your ads on "Joe Schmo’s Sports site" could be doing the client a disservice.

I thought we already had this debate. In the early going, lot of us were critical of the contextual ad programs for a number of reasons – mine was simply the poor performance, fraudulent or crapulent publisher partners, etc. Others in the biz, with more of an agency bent (and most likely to cheer for Quigo, Sprinks, etc.), demanded that Google’s content targeting allow more direct control of what websites ads show up on, as opposed to forcing advertisers to accept the open-ended "smart matching" concept that used semantic technology to match ads with content.

So… first Google responded with site exclusion. Then, they released a site-targeted flavor of content targeting, in a parallel program. That as a direct response to these agency-style demands. Site targeting allows you to browse a menu of sites, add them to your list, and only show your ads on them.

I monitored ads running in both flavors for several months. A funny thing happened: the old "flawed" content targeting program got better, and my approach to managing those campaigns improved. The ROI came in line with search. Meanwhile, nothing on the "site targeting" side was converting. The performance was much worse.

At a couple of conference presentations I guessed that this is in part because computers do a lot better job of matching my ads against a million potential candidate pages than I possibly can in scanning down a list of 50 so-so potential publisher targets. You settle on 20 or so of these sites, then become obsessed with spending the full budget on just those. They convert poorly, so you’ve overspent on this handful of websites. That’s a fairly typical scenario.

In short, because of computers aiding in the matching, classic content targeting offers more efficiency, as the systems get perfected.

Seth, both the intuition and the data point towards there being nothing inherently wrong with Google’s approach to matching ads with content. No, the program isn’t perfect, but placing high-CPM ads on big brand sites just because I want to appear respectable isn’t exactly a challenge. It’s more of the same: take too much of the client’s money, and waste it, and claim the blue-chippiness of that approach as a benefit.

Both approaches — the finicky put-me-only-here approach, and the "ROI-or-else" approach — work in the marketplace. For very different reasons. Funnily enough, Google now offers two parallel programs to suit different ad buying constituencies, and are working on rolling out multiple ad products down the road, to keep everyone happy.

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The Lexus loaner turned out to be a GS Hybrid. To say it was an upgrade from the battered Crown Vic I’d driven with the LAPD would be an understatement. For one, you don’t need a key. You keep the remote control thing in your pocket and to start the car you just push a button on the dash. Like on a computer. In fact the car’s more like a super-powered laptop on wheels than anything else.

Call it a fictomercial, a literatisement, branded entertainment. Lexus doesn’t really care. As long as it makes people lust after its new top-of-the-line car.

And the connection to online advertising? Lexus hopes to turn the book into a podcast!

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