Adify Reports Rising CPMs in Some Categories

  |  August 19, 2009   |  Comments

Median CPMs remained flat, but real estate and news/entertainment verticals have seen price increases.

If a new report from premium network aggregator Adify is any indication, display CPMs for some key verticals may be staging a comeback.

The company serves ads on a group of 200 niche vertical networks such as DriverTV, Hockey Ad Network, and Real Estate and Living. Its quarterly report, to be released today, says that although its median CPM remained flat since Q1, some positive numbers were posted in the second quarter of this year. That median CPM was $7.71 with a range of $3.63 to $19.89. However, real estate network CPMs grew 100 percent between Q4 2008 and Q2 2009, sports and entertainment prices were up nearly 20 percent, and news-oriented content CPMs commanded over 20 percent growth over Q4 2008. Travel, technology, automotive, and health held onto the highest CPMs for Adify since falling to rock bottom levels in late 2008.

"What it says to us on a broad level is that display ads are still strong and branding is still strong," said Adify senior marketing VP Joelle Gropper Kaufman. "Not everything is going to be spent on search. There's still no silver bullet for Internet marketing and we're excited about these overall trends."

Two things stand out about the Adify numbers. First, they are exponentially higher than some of the more widely reported average CPM figures reported earlier this year, which were measured in cents. Part of that is because Adify's audience is smaller and more targeted than its larger competitors. It ranked 39th in the most recent comScore ad network analysis, with 69 million unique users. Kaufman says the rich media-heavy ads run on Adify have higher CPMs because the networks have stayed with quality content and the publishers within the networks have innovated with ad positions and customer engagement measurements. That innovation, she says, has resulted in the steady CPMs for travel ($19) technology ($16) and automotive ($15).

The second trend worth noting in the numbers is the relationship between inventory and demand. Real estate and sports jumped because advertiser demand for available inventory jumped dramatically. Kaufman's analysis of the real estate category shows that available mortgages, which were almost non-existent in Q4 2008, jumped dramatically in Q2 2009, and mortgage advertising kept pace. Real Estate CPMs, at $6.49 for Q2 have shown the most noteworthy CPM growth.

Sports CPMs were driven by March Madness, baseball fantasy drafts, and the NFL draft, boosting CPMs nearly 20 percent to $7.09. Entertainment was also notable (up 19 percent) since October 2008, in keeping with the "inventory demand" model as the movie industry tends to fare well during recessions.

Up next? The business vertical. "It is growing steadily quarter on quarter which likely reflects continued interest in business news and business analysis," Kaufman said. "The federal bail-out and TARP rescue elevated general interest in business practices and policies. As credit flows more freely, we expect competition for qualified audiences on business sites to drive CPM growth further."

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