Zephrin Lasker is CEO and Co-founder of Pontiflex, a cost-per-lead marketplace.
ZL: Definitely. When we started Pontiflex two years ago, we anticipated that most of our growth would come from direct response marketers. But surprisingly we have seen a very rapid adoption of Cost-per-Lead advertising by brand marketers who are looking for cost-efficient and scalable ways to connect with new consumers.
We’re seeing major brands like HUGGIES, Dell, Blackberry and others look to CPL advertising as a way to acquire marketing leads. I want to be clear here. When I say marketing leads, I mean the contact information of people who raise their hands to hear more from a specific brand – the kind of information you would collect off a landing page in a display or search campaign.
Our advertisers pay for these marketing leads on a performance, or Cost-per-Lead basis and then engage them in a variety of ways. As many as 51% of advertisers used community sites and social networking groups to engage consumers. This was closely followed by e-newsletter programs with special deals and offers.
So yes, as brand marketers begin to think about branding not as broadcasting, but as engagement, we will see more brand marketers use performance marketing to accomplish their objectives.
Please discuss the momentum for Pontiflex in the past year. What are the strengths? (verticals, pricing) Any weaknesses?
We’ve had a tremendous year. We’ve tripled our client base and seen over 300% YOY growth in a tough economic climate. Most of this growth has been driven by the massive adoption of CPL advertising by Fortune 500 companies and national non-profits.
Based on the feedback we’ve gotten, businesses love the simplicity of the Pontiflex AdLeads technology. We started off as a technology company – and at every step we have tried to make CPL advertising as simple and intuitive as search advertising.
We also made big bets on openness and transparency – and both have paid off. In terms of openness, advertisers can use Pontiflex for no charge to do a variety of things – manage a non-Pontiflex CPL campaign or hook Pontiflex up with their ESP, something that allows them to acquire leads and follow up with them in real-time easily. In terms of transparency, our advertisers can make an informed decision about where to run their campaigns and optimize campaigns by lead source.
In terms of weaknesses, I would say that we could have done more to educate the market about Cost-per-Lead advertising and how it fits into the overall advertising picture – particularly the worlds of email and social marketing. We have to continue telling the stories of how some of the world’s largest advertisers are using CPL to grow their email lists and build responsive social communities. That’s something we’ll continue to do in 2010.
How important are exchanges and buying across multiple supply sources (a la a demand-side platform) to Pontiflex buying strategies?
Buying across multiple supply sources is important. Consumers spend time across multiple media – all at once, and advertisers should be able to run campaigns while keeping with the new ways of media consumption.
There was a Nielsen study recently that said people spend something like 68 hours a week online. Look around you; people have their heads buried in their smart phone, which is not really a surprise with 91% mobile penetration. One of the more interesting points I’ve come across lately is that people spend three times more time on Facebook than on Google.
Given these dynamics, in order to connect with consumers, it’s imperative that marketers be present across channels. So of course, our technology team has worked hard on giving marketers the ability to run CPL campaigns across online, mobile and social networks from one point of connection. For example, Blockbuster ran a campaign across online and mobile sites with just one insertion order.
Advertisers are dealing with an incredibly fragmented market now with so many vendors and technologies. We are focused on helping advertisers consolidate and keep it simple.
What do you think of the demand-side platform buzz? Is it hype?
There’s so much change going on in the online advertising world. These are still early days for many kinds of products and offerings, and it will be interesting to see what remains standing once the dust settles down. Specifically, for the demand side platforms, we have been approached by some players to integrate our proven CPL technology with their offering and in the spirit of openness and collaboration, that’s something we will work on.
Are you thinking about real-time bidding as an important feature of your company's offering?
Real-time is no doubt important, and as liquidity expands and the market grows we will accommodate an appropriate model. The difference for us is that because marketing leads are unique to an advertiser’s offer, they aren’t a fungible commodity. This is important because it protects the advertiser’s brand and the consumer’s privacy.
When buying, how much do you care about transparency on an impression or bucket of impressions?
Transparency is an absolute must for us, and it’s a key driver of our success. We’re a transparent CPL marketplace, which means that advertisers can track marketing leads to the publisher source and optimize performance accordingly. If one particular site isn’t producing the right leads, dial it down or turn it off. If a particular site is performing really well, the advertiser can crank it up. This gives marketers control over not just how well their campaigns perform, but control over where their ads will appear. Having transparency also helps protect brand integrity which is very important for all of our clients such as Disney, Blockbuster, UNICEF and Dell.
Any predictions for 2010 - perhaps something not everyone is thinking about - but will?
I think that what we’ll continue to see in 2010 is a more symbiotic relationship between email and social marketing. There’s been a fair bit of debate about whether email becomes less relevant now that social networking is so dominant. I strongly believe that email will become an even more important tool in 2010.
A recent Harris Interactive study showed that 96% of online adults are willing to share email addresses with brands while only 12% are willing to share social networking information, such as Facebook username or Twitter handle. These statistics prove that marketers first need to build trust with consumers via email before engaging them on social networks.
Performance advertising will continue to grow in 2010 – and this growth will be driven not just by direct response marketers, but by brand marketers. Brand marketers will turn to performance advertising not only for the cost-efficiencies, but also because performance advertising by its very nature delivers a consumer who is searching for a product or signing up for an offer – a more engaged consumer. These are the kinds of consumers they want on their Facebook and Twitter groups.