Rogier van den Heuvel is VP, Worldwide Sales, of messaging service and Amsterdam-based, eBuddy.
AdExchanger.com: What's the startup culture like in Europe - even Amsterdam, specifically? Are there hotspots? (i.e. like Silicon Valley in California) Is creating interest with venture capital firms a challenge?
There is a thriving start up culture in Europe including tech, software, internet and mobile companies. These include: Layar, Distimo and eBuddy in Amsterdam; Amiando in Munich; TweetDeck and Flirtomatic in London; Vente-privee.com and Jolicloud in Paris; Spotify in Stockholm, and many other examples of European start-up success stories. There is not truly one European hotspot for Internet start-ups, although some might say that Scandinavia was at the forefront of Internet connectivity. They were able to get people online quickly and ad spend there was among the first countries to surpass traditional media such as TV.
London is a media center and hub but it’s also rather expensive to live and work there, so setting up a business somewhere else like Amsterdam, Berlin or Copenhagen can be an equally good or better option for a number of companies. London is typically the starting point for a number of US based companies who want to make the step across the Atlantic into Europe, and certainly a part of this can be attributed to the fact that English is their shared common language.
The economy also continues to grow more and more global. We’ve found that it is equally important for European startups to build strong ties and good business connections with companies and business people in Silicon Valley and the APAC region.
What online advertising trends are you seeing today in eBuddy's business?
eBuddy is exceptionally strong in brand campaigns that target tech-savvy 15 – 25 year olds who want to be online all the time on their PC and mobile devices. Entertainment (like DVD, movies, games), FMCG and mobile brands are all doing very well at reaching our audience. In those sectors, we’ve seen strong growth and demand for rich media, video banners and integrated solutions like homepage and messenger takeovers. There is clearly a movement towards greater consumer engagement.
Overall, CPM pricing has become pretty stable over the course of the past quarter. We see a trend in moving towards adding value to the inventory, through ad exchanges, network optimizers and data/audience networks or exchanges. Impressions that previously were thought to carry little value can be injected with added value when combined with audience targeting data. Data exchanges pull demographic and behavioral data on those same consumers from many more sites to fill in the blanks and create a more complete user profile. Advertisers are becoming more and more interested in buying pockets of unique users instead of just buying buckets of ad impressions, and this equates to better CTR optimization.
A deal size for eBuddy depends a lot on the country. We see higher deal sizes overall because we are able to combine both web and mobile advertising campaigns and add in multiple countries or regions. Plus, we can make global deals because we have users in more than 200 countries.
Is there a difference between the trends eBuddy may see as a web browser-based instant messaging service versus a more traditional web publisher such as a news website?
The biggest difference is content or in eBuddy’s case, the lack of it. Where content is expensive and can be crippling for a business, eBuddy has the ability to explore other avenues that are equally lucrative. eBuddy’s core business revolves around its tens of millions of users, and eBuddy continuously increases its user numbers across the globe month-over-month and year-over-year. This is done by constantly improving the central part of the service you provide, and in our case, it is web and mobile instant messaging. Our users want to communicate more and more often, so the engagement and online time spent on eBuddy messenger is very high. We can even reach the same user multiple times on both our web and mobile platforms. It’s critical for us to target based on research and our end user demographics instead of based on content. By doing so and working together with good strategic partners, we are able to ensure that we are displaying only the best performing campaigns to our users.
Another difference is that most web publishers or news sites are regional and not globally focused. Technology continues to make the world increasingly smaller and our ability to reach a global audience is absolutely a big competitive advantage.
What do you see at the next big thing in online advertising technology?
On mobile: In-application advertising, location based advertising and augmented reality advertising.
On the Web: Larger display ad formats designed to promote creativity among advertisers and encourage Internet users to actively share ads.
On social network aggregators: A place for all your various social networks, i.e. one inbox/place to keep in contact with all your various social media networks or friends. (Much like what eBuddy does with aggregating of your instant messaging networks, but then for all your social networks.)
What's your view on display advertising? Does it work?
I believe branding works especially when we talk about sponsorship packages. Display advertising can create new insights into a user if this is expending his interests. The way to achieve this is via proper targeting and truly “knowing” the end user. There was previously a lack on information about the end users. Display is not dead though, and it will develop further this year once we are able to match the consumer’s interests with banner advertising. It is something that has been tried in the last year or two, however 2010 is the year it will finally work.
Any thoughts regarding the differences in digital advertising between Europe and the U.S.?
The EU is a bit behind with the newest developments on the web front. Mobile advertising however, seems to be taken more seriously in Europe than it is in the US.
The EU was behind when it came to rich media, video, and now data and statistics. Some of the best creative still comes out of Europe though.
Europe typically sees less advertising information compared to the U.S. The most important reports and surveys are typically focused on and have detailed information about the U.S market, although this is starting to change.