Ad Networks or Content Sites? Content or Data? Confused? Listen to the Crowds

If you weren’t paying attention you might be confused. Or, maybe you are paying attention and you’re still confused. Or, maybe in your confusion you’ve decided to quit paying attention and watch for signs of warmer weather.  Just in case, there is an interesting juxtaposition today in Ad Age between research from Advertiser Perceptions that reports marketers are accelerating the shift back to content sites for media buys (“Marketers Shifting Online Budgets to Content Sites”), and a column from investment banker Tolman Geffs arguing instead that the momentum is with the audience networks (“Get Ready for the Coming Land War in Online Display Ads”).  Says researcher Advertiser Perceptions: A survey of agencies and marketers revealed that 52 percent of them plan to spend more on content sites this year, whereas only 35 percent said they were likely to increase budgets for ad networks.

Read More: HuffingtonPost

Hulu to Launch a Subscription Service in May?

In May, Hulu plans to start testing a subscription service for a monthly fee of $9.95, claims the L.A. Times, citing people familiar with the plans. Currently, Hulu viewers can see the five most recent episodes of popular shows such as Glee and Lost. The subscription service, called Hulu Plus, would enable users to see older episodes of these shows.  Although unconfirmed, this news is on track with a previous report that said that Hulu was planning to launch a subscription service in a matter of months. Back then, it was speculated that the monthly fee would be $4.99, but the price of access to unlimited TV shows seems to have risen in the last couple of months.  If it’s real, Hulu Plus is perfectly aligned with the launch of iPad 3G; the two could be a fantastic combination for accessing your favorite TV shows from any location. The monthly fee, however, is not negligible.  When we first wrote about Hulu’s possible subscription service, we asked you if you’d pay $4.99 for it, and many of you answered yes.

Read More: Mashable

The Marketplace Appreciates Obfuscation in Pricing

Pricing is defined as the property of having material worth. Pricing though does not dictate individual value, but rather the value of a good for the average.  Let me illustrate by an example:

Sherri walks into CVS to purchase some shampoo for the Herman household.  She sees Pantene for $6.45/bottle or Sunsilk for $9.99/bottle (totally made up numbers).  Sherri has a specific price in mind she wants to pay for Shampoo based on her proprietary valuation system (special needs, bottle shape, accessibility, etc) and based on this specific value, she is able to decide between Pantene and Sunsilk.  Pantene and Sunsilk are offering (pricing) their products at these price levels because they have done a comprehensive supply/demand curve and have optimized where they should price their product for the optimal (not always most) amount of buyers.  This is done through market and competitive research as well, as, historical sales scenario planning data.  In this scenario, the marketplace appreciates pricing obfuscation:  it’s simple for the consumer and it’s simple for the business.  The consumer never sees the profit margins (unless they are purchasing from a public company and even then, how many consumers read financial reports) and the business never knows how much the consumer was really willing to pay (potentially more).  There is not really a tension here – if a product’s price is not adequate for a consumer, they will move onto the next product on their list.

Read More: DarrenHerman.com