Did Microsoft $6 billion buy cause AvenueA Razorfish to lose clients?

Well it’s too soon to tell–the ink is still drying on the aQuantive deal, Microsoft’s biggest acquisition ever. (Have you noticed how organic growth stops when garage entrepreneur’s become behemoths?)

My suspicion is that Razofish will be affected. It’s not wise for any media to buy an agency and vice versa. This is not rare though; WPP for example own media. Nielsen are owned by VNU. Marketers will simply have to set-down ground rules to their media planners in-house or outsourced. Or conflicts of interest will run amuck. With the large consumer packaged goods and auto accounts, the biggest on-line buyers this will buzz around the water cooler. Razorfish’s client lunches budget will balloon. I’ll bet they are sipping apple martinis on Mad Avenue as I key-in.

Did Microsoft account for advertiser losses in its valuation? Will Microsoft spin out the Agency? It would make life easier; but, temperance can prevail.

eBay: Another on-line ad exchange!

A few days ago I announced in Hot New Launches April 2007 that DoubleClick is launching an on-line ad exchange. But three marketers, Philips Electronics, Home Depot and Hewlett-Packard, had already contracted eBay to the tune of $50 million to build a similar exchange. In lock-step the cable networks are digging in their heels and refusing to sell air time to eBay, fearing the permanent reduction of the price earned by human negotiation.

I like the access these exchanges provide to marketers indeed. Will these auction platforms provide the intuitive thinking media planners and buyers bring to the table? Most media planning is based on numbers, ratings, reach and frequency. Program selection requires more than Nielsen ratings; however, the marketer will be able to choose content on-line. So will these auctions put traditional media negotiations at risk? Will eBay offer a visual plan and buy spreadsheet? Will it be this intelligent?

Air time buys have always been made within a model that includes a number of impressions within a four week period. Ideally, a minimum of three impressions are required to get advertising to the minds of viewers. That means you must buy multiples of three :30s to ensure that you are seen three times e.g. 24 spots and more.  (With audience fragmentation this increases!) There is no doubt as neuroscience proves that repetition can result in message absorption; BUT if the advertising is not engaging emotionally, a higher buy is required. More spots. Frankly, air time is a commodity. The content rules. No auction will ever benefit content, its relevance and resonance. This is the untouchable. TV is still the best device today for quality, intrusive content delivery–and it is now that networks have a morsel of power left to ensure their sustainability.

I don’t think off-line media will soon die. Simply, the players will increasingly adopt on-line media and both will subsidize each other depending on the momentum of this media evolution. No doubt, this is THE industry under siege at the hands of web 2.0.

So for now these exchanges will have to find propulsion through other than cable delivery networks. Will the resistance end here? On-line is hot and will breathe life into these engines. Don’t forget this ad space:  outdoor, radio, print, shelter, transit, mall, elevator, grocery carts, product placement (brand integration), dirigeables, wall graffitti, urinals and forehead tattoos.