Remainder aka remnant advertising are not exactly widely known terms, but the average person browsing the web for content knows perfectly well what it is. Anyone who’s ever browsed their favorite news site and has been exposed to advertising units that seem totally off base with the publisher brand, or even completely – even if unintentionally – juxtaposed to the content that’s being viewed has been a ‘victim’ of ads that were placed just to fill up unsold ad inventory, which is what remnant advertising comes down to.
5to1, a startup with a high-profile founding team that includes former Fox Interactive execs Jim Heckman and Ross Levinsohn, has raised $4.5 million in seed funding to work on a solution that can turn remnant advertising into premium advertising. The company’s breaking out of stealth mode today at TechCrunch50 with a service that could rid both publishers and advertisers of the extremely ineffective ad campaigns that are basically only beneficial to the networks selling them.
The 5to1 system allows publishers to get in between the remnant networks and the ad inventory to give them more control over what will appear on the site, where and when. The company’s founder and CEO Jim Heckman dubs it a “Match.com meets iTunes for advertising” because it allows publishers to dynamically create ‘playlists’ of ad units of sorts and easily run both proper ads and potentially placeable remnant ads on variable places on their website(s).
Ultimately, the goal is to make it easier for content publishers to increase the quality of – and with it, the revenue that comes from – the ads that appear on unsold inventory without too much hassle. And if it takes off we’ll see a lot less of these horrible screaming ads that you’d never click on even if they held you at gunpoint.
Expert panel Q&A:
Q – Marissa Mayer: At Google, we agree that optimization can be done. However, what technology do you have for matching content to advertising, and how can you provide for larger-size networks with lots of inventory?
A – Jim Heckman: We’ve been in stealth for a year, but we’ve noticed that publishers like hearing about being able to match advertising with context and having control over it. We didn’t want to compete with the Google model, but we’re more like iTunes: you ‘play’ ads whenever you want. It’s no different than what Web 2.0 has done for content. So if you’re a tech blog on gadget, you can see what ads work for gadget news sites specifically. It’s not algorithmic, but more of a marketplace.
Q – Roelof Botha: Can you demonstrate better CPMs?
A: We can find ads so fast, even with hundreds of thousands of ads in the system, literally in seconds. You can drag and drop ads right in the rotation. We talk to publishers and they tell us that even if we get similar CPMs but just prettier ads that don’t curse with the content, they’d already be happy. But talk to us again in six months.
Q – Tony Hsieh: Does it take a lot of time for publishers to deal with your system, and what about scale?
A: We showed publishers in our beta test that it doesn’t take a lot of time to manage their advertising units on unsold inventory. They want to be involved, and they seem to be motivated with the speed of our system. The key thing is: the compiled results of the entire network shows the context of just one ad in seconds.
Q – Paul Graham: Humans can only do worse than the best optimization, right?
A: Pages are dynamic. What we found is that a vast majority of ads are not contextual, and we can fix that.
Q – Marc Andreessen: Regarding the chart, which side do you lean most to?
A: All inventory is not created equal, but I’d say just in the middle.
Video:
Pictures:
Other coverage:
TC50: 5to1 gives publishers more control over their ads VentureBeat.
This concept makes no sense to me. As a publisher I want one thing: money and I don’t care who gives it to me. And why would I want to spend time and resources to “filter” my ads?
This presentation was so boring!
Fewer crap ads. I’m for it.
I don’t disagree that there are a lot of terrible ads out there being served up by a host of ad networks and that this is decreasing the value of online ad impressions overall. That said, the most important thing to publishers is always going to be what ads yield the most revenue. Who cares about serving a pretty ad if you aren’t earning a higher CPM? Clearly, each publisher may set their tolerance at a different point- ie, is this money worth serving this crappy ad to my audience?
This 5:1 solution assumes that the context of an ad is what makes it perform well, but that does not necessarily mean it will create a higher yield for the publisher. In fact, in many cases, ads that are overly contextual have poorer performance than ads that are targeted to the user based on behavior or relationship to the site.
The real test for this will be the CPM’s, until then it’s just a flashier version of Google’s display interface.
For a large site you’d have to create an unmanageably large list of whitelisted ads to fill all your ad slots. However, it could still be nice to say “here’s a whitelist of ads that I prefer to show first if available.”
@needmoney –
“I’am for it” as a publisher or as a consumer?
Google could implement a tweak to their AdSense system which allows certain white-listed ads to be given preference… and 5to1 will become obsolete overnight.
He sounds like an infomercial — this is just another ad network with a new feature. Not that there is anythign wrong with that.
How did they manage to get all their blog sign-ups?
What’s the quality of the blogs?
As an advertiser you need to check all ads and all advertisers.
5:1? More like 25:1 this company makes it.
Gave them a twirl and got .8 cent CPM’s. The creative wasnt anything special either.
Does this company have any IP? The presentation made it sound like a service based play.
“That means a sports publisher, for example, could prepare ads for their site in anticipation of the Pittsburgh Steelers winning the Super Bowl. If the Arizona Cardinals ended up winning, Heckman said the publisher could choose from a different slate of ads that would target that fan base.” This is called Adsense and Double Click.
What problem do these guys solve?
Well— 5:1 might have a great idea, but their public email for publisher inquiry email bounces back…. with a very odd message:
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To:
The info on the homepage is false. Heckman didn’t build Rivals to sell to Yahoo! After he was fired from Rivals His attempt at getting Rivals back failed. Then, Shannon Terry bought the name and he and a handful of others built it back up to sell to Yahoo! Heckman had nothing to do with it. Last, wasn’t he at Zazzle for a year or so?
I’ve never, ever, ever seen such a bloated management team in a startup. A CEO, President, COO, two co-chairmen, CTO, both an EVP and SVP of Sales, an EVP Strategic Partnerships, an EVP with no specific role, and a VP Corp Dev ?
Hello? Are you kidding me?
As a consumer I am for more relevent content/ads. And, as a business owner, I also like the idea that if I want to promote my business, there is a more relevent context in which to do it. I get tired of getting calls every week from companies telling me they’ll put on the first page of Google search results. I get there already for free because of all the online SEO I’ve built up with all of my current low cost marketing tools. I’ve avoided paid advertising online just because it seems that it’s a spam the universe approach and I want very targeted control over what I put out there for me, my brand, and my company’s efforts.
this is going to hurt
http://www.tech...or-display-ads/