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Online Ad Network Prices Dropped In April

Posted by Mort Greenberg on May 25, 2008

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The AdPrice Index showed an average 23% decline from March to April in monetization from online ads.

The U.S. economic slowdown has hurt online ad network sales, according to a report showing an average 23% decline in monetization from online ads.

PubMatic, a company that automates and optimizes ad inventory decision-making for Internet publishing, released its second AdPrice Index on Wednesday.

The index, based on information from more than 3,000 publishers and billions of ad impressions, showed that Web sites with more than 100 million monthly page views felt the steepest drop. Those sites’ monetization rates from ad networks plummeted by 52%, from 38 cents in March to 18 cents in April, PubMatic said.Eighty-five percent of the Web sites included in the analysis are based in the United States. The numbers, which reflect monetization from ad networks, exclude the networks’ share of ad spending and inventory that publishers sell directly to ad agencies or advertisers.

Web sites with 1 million to 100 million monthly page views declined from 34 cents to 33 cents in the same period, according to the index. However, monetization increased from $1.18 in March to $1.29 in April for small Web sites.

The report looked at vertical markets and found that social networking dropped more than others (47%), from 37 cents in March to 19 cents in April. Before that, January saw lows of 22 cents. Entertainment decreased 17% from 40 cents to 33 cents from March to April, according to the index. Gaming and sports dropped 4% and 5%, respectively.

Technology saw 83 cents in April compared with 82 cents in March. That’s still down from January, when technology Web sites’ ad network monetization hit a high of 92 cents.

PubMatic said that many publishers turn to best practices to maintain or grow revenue and offset declines. Best practices include network diversification, monetization of international traffic to cope with the weak U.S. dollar, and segmentation of categories.


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