eBay’s wise decision to can an ill-fated and unwise auction marketplace for advertising has been kiboshed, Ad Week reports.
Online auction house eBay has shuttered its Internet-based system for buying and selling TV and radio ads, the company has confirmed on its Web site. The system had been up and running for just over a year.
The system was controversial from the start and received little support from the cable network industry, which eBay had hoped would contribute significant amounts of inventory. But the networks by and large stayed away fearing the process would cheapen the value of their ads.
The Cabletelevision Advertising Bureau, a trade group representing the sales groups of most of the big cable networks, did not endorse the system and few of its members participated. Among the few networks that tested it were Oxygen and Ion.
Executives at eBay believed part of the problem was that the marketplace remained confused about how its cable ad system worked. While it was often referred to as an auction, it was actually an electronic RFP system where buyers could issue requests for packages of time specifying their precise needs. Sellers could respond and a negotiation would ensue, via the system, until a deal was concluded.
Let this serve as a lesson for the frigtards who think that ad agencies (media planners, creators and buyers) will eagerly give up their role as gatekeeper to a global $500B marketplace, off which they generate a 15% cut (so roughly $75B per annum).
In 2005 when I left my old gig as VP of Sales for an online publisher I thought of something similar… so I picked up the phone and called some of my contacts at agencies. They all said this would not work… for the reason I outlined above.
This might have worked before agencies realized how big the online media space would be, now they know how big it is, how much bigger it will be and trust me they don’t want another Google to come in between them… especially when you consider Google’s outsized market cap relative to the Big Four agencies.
Love how eBay says the failure is a result of agencies not understanding this or that. Really? Maybe it’s because they understand it too well and don’t want your auction paws anywhere near their $500B ad pie.
Subscribe: