INTERACTIVE: BEHIND THE HYPE/US NEW-MEDIA SALES HOUSES: The US giants making moves on the UK’s new-media scene - Will the new-media outfits setting up over here help or hinder our local sales houses?
By RICHARD COOK, campaignlive.co.uk, Friday, 14 November 1997 12:00AM
The last time it happened they came with two main weapons. It’s pretty much the same this time around. During the Second World War, the Americans, bearing chewing gum and nylons, made the local competition look parochial and unglamorous. This time it’s America’s vaunted new-media giants that are setting out to put one over on the local talent. Their weapons might be more sophisticated this time around - strategic know-how and superior systems for starters - but in the end they could be just as effective.
The last time it happened they came with two main weapons. It’s
pretty much the same this time around. During the Second World War, the
Americans, bearing chewing gum and nylons, made the local competition
look parochial and unglamorous. This time it’s America’s vaunted
new-media giants that are setting out to put one over on the local
talent. Their weapons might be more sophisticated this time around -
strategic know-how and superior systems for starters - but in the end
they could be just as effective.
DoubleClick has become the latest of the US new-media giants to set
itself up for business on this side of the pond. Having looked long and
hard at the prospect of a joint venture or acquisition, the company has
decided to start out in London the hard way - from scratch - and has
recruited the Network’s Andy Mitchell to head a seven-strong team.
For DoubleClick, it’s an important stage in its drive to establish a
true global presence - it will have offices in ten countries by the end
of the year. However, the company isn’t quite starting from scratch.
’At the moment, we generate around 35 per cent of our traffic from
non-US users,’ Barry Salzman, DoubleClick’s vice-president,
international, explains. ’This includes - even before we set up here -
around 12 million impressions a month in the UK market. In fact, the
sites we represent already generate three times the number of
impressions that even a popular site like the Telegraph can offer.’
This is the first element of the US new-media double whammy - size
DoubleClick only represents around 75 Websites but in the US it doesn’t
bother with Web publishers that generate anything much less than one
million impressions a month. And even allowing for the fact that there
may be a temptation for ad networks, shall we say, to over-deliver
impressions, it’s still an impressive set of figures.
Real Media, another of the US giants to open over here, can summon up
equally impressive numbers. It has a network of more than 450 online
newspaper sites, covering 45 of the top 50 dominant marketing areas in
the US, including most of the country’s major newspaper publishers.
’The UK market isn’t yet at the sort of level to justify the investment
we and others are making,’ Salzman concedes , ’but it will be. I don’t
know if it will happen in six months, a year or whenever. But I do know
that the UK growth curve will be exponentially steeper than in the US
because the players over here are all learning and have all learned from
the mistakes made in the US.
’We think the whole market will grow but we also think the current
balance of power - where most of the sales opportunities are aligned to
the content owner - is likely to change. The existing system seems to be
a conflict of interest, which should be of benefit to independents like
The UK sales houses, on the other hand, have responded to the invasion
with rather better grace, thinking that the entrants will help the
’Both Real Media and DoubleClick are well established and professional
new-media sales houses and, as such, we welcome them into the market,’
Carol Dukes, joint managing director of Emap Internet Sales, says.
’There will, of course, be competition in the market and I’d rather it
came from professionals who will help educate the market properly and
who will maintain sensible rates, than from more casual operators who
could spoil the market in this important early stage.’
But it isn’t just their size and independence that the US players
believe will give them the edge. DoubleClick claims to have stolen a
march on rivals this side of the Atlantic by developing software that
enables it to identify Web browsers by country of origin, and not rely
on the domain extension name alone. ’We will have the means to tell
advertisers that their message is going just to a UK audience,’ Salzman
says. ’Sales houses that can’t offer that could waste up to 30 per cent
of the advertiser’s budget.’
So is it the case that the US sales houses really are not just bigger,
but better? Perhaps understandably, Dukes believes not. ’The Americans
aren’t really bringing anything new to the UK,’ she maintains. ’In terms
of technology, we at Emap are already using the Accipiter banner server
system which is used by many of the major US companies, such as ZDNet
and c/net, and which has just been chosen by Microsoft to use on all its
sites worldwide. Many other UK-based new-media sales operations are
already using leading US technologies, such as NetGravity, anyway.’
What isn’t disputed is the fact that this type of incursion is likely to
help sharpen the market overall. The global focus these companies bring
to the market is clearly only going to grow in importance - after all,
the absence of national boundaries is the Net’s real usp.
’I think what we are all going to learn from the Americans is not really
the technological stuff - and certainly not the creative stuff at which
I think we lead the way - it’s in the experience they have had in
generating strategic input with their clients,’ the managing director of
Online Magic, Eamonn Wilmott, believes.
His company has operated a New York office since 1994 and cemented its
international ties when the US giant, Agency.com, took a substantial
shareholding earlier this year. ’They had a lot more experience at
developing Web strategy and that is increasingly the skill new-media
clients will be looking for,’ Wilmott says.
This article was first published on campaignlive.co.uk
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