Innovative advertising solutions don’t have to be about high technology and whiz bang interactivity. Beginning June 11, Bid4Spots will host online reverse auctions for cable TV ad space, promising a relatively low-tech, low-commitment way to fill remnant time. (For the initial announcement, click here.)

The advertisers are the buyers. They establish criteria, including demographics and geographic location, and what they are willing to pay based on an algorithm that determines the cost per 1,000 viewers (CPM).

Registered cable operators that meet the criteria receive an invitation to join in specific auctions. Ad content is available for viewing prior to the start of the auction, which takes place once a week. Operators bid against each other, with the winner being the one who offers airtime for the lowest rate, with the CPM factored in.

"Our goal is to bring (operators) lots of new advertisers," Dave Newmark, Bid4Spots founder and CEO, said.

Good business

Competition to drive down ad rates sounds great for the advertisers, but what about the cable operators? Will they benefit? Pablo Safronchik, new business development manager, MegAvail, which handles ad sales for rural operators, said yes, the Bid4Spots model is a "win-win" for everybody. "The advertiser gets to spend its budget in a transparent manner. The cable operator gets to receive revenue it otherwise wouldn’t have received."

The time slots at question are those that often go unused, are filled by remnant buyers at rock bottom prices or by per-inquiry ads where operators are paid based on customer response.

"If they have excess inventory, they will roll the dice and run these campaigns and hope viewers make the phone call. Would you prefer to have this gamble or guaranteed revenue?" Safronchik asked.

Proof is in radio

The Bid4Spots model is not new. The company has been running auctions for radio advertising since 2005. Last year, its online marketplace for radio airtime doubled, with about a dozen new firms "show-up on our doorstep," every day, Newmark said. The auctions have attracted mainly small- to mid-sized national companies without ad agencies.

Bid4Spots does not envision itself as a replacement for scheduled buys or as a competitor for new high-tech initiatives like Canoe Ventures. "We want to be one of the many different levers that the systems pull as well as the advertisers pull as they execute their plan …. We want to remain in the last-minute space," Newmark said.

While Canoe aims to provide more precision for targeting the viewer, Bid4Spots has a different value proposition. "We are saying, ‘We don’t really know who is watching. We are just going to do this big broad buy and let the reverse auction drive the rates down,’" Newmark said.

– Monta Monaco Hernon

Read more news and analysis on Communications Technology‘s Web site at www.cable360.net/ct/news/.

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