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ebay AdContext Product Manager Sheds Light on Program

One of the product managers from ebay’s new AdContext contextual ad program, Ken, has just left a comment on my previous post about AdContext. As the comment was pretty long and quite comprehensive I thought I’d promote it to be a post of it’s own. Hopefully it sheds some light on AdContext for those of you considering joining the program. Keep in mind the information is from someone working on it so there is an element of natural bias there – but I think Ken’s done a reasonably good job. Thanks for stopping by mate. Here’s his comment:

I’m one of the product managers for eBay AdContext. I just read Darren’s post and everyone’s comments and I wanted to give everyone some information so you can decide if AdContext is worth your time (or not :). I’ll try to keep it factual so you won’t think I’m trying to pull some marketing spin here.

Payout structure: The payout structure for eBay AdContext is based on eBay’s affiliate program. In the US this based on a revenue share for bids, BINs as well as each new confirmed registered user (CRU) you send to eBay. Details are here. For other countries where eBay operates the compensation structure is not revenue share but pays out on each bid, BIN and CRU (for example, see the UK payout structure here).

Revenue share percentage: Note that the minimum tier pays 40% of the revenue and the maximum tier is 70% (not the 30% and 60% that Darren had in his original post).

Buy It Now (BIN): Publishers will have the ability to have ad units show only BIN listings in the ad unit if they so choose. This should address the concern that was raised that people raised about not allowing BIN listings to be part of AdContext. Also, as Arnie pointed out in his comment, you can show auctions that are close to their ending time so the odds of winning quickly are higher.

Winning Bids/BINs: Note that the publisher can actually generate revenue from multiple winning bids/BINs (not just one). The publisher “owns” the referral for up to 7 days and any winning bids/BINs generated in this time period contribute to the revenue shared with the publisher. For instance, a person reading a cell phone review can click on an ad unit for a cell phone and purchases it via Buy-It-Now and then may decide to place a bid on a bluetooth headset and win that auction 4 days later. Both the revenue on BIN cell phone and the auction bluetooth headset are part of the revenue share to that publisher. Note that since tracking is done on a “last publisher to refer the user wins” basis by CJ.

Category Hints: When creating their ad unit publishers have the ability to provide category hints to the system. These category hints map 1-to-1 to the eBay category structure and will optimize the keywords and the listings that are displayed in the ad unit . For instance, if you know that your site is oriented towards sports memorabilia instead of sporting goods, you can provide a category hint that will allow AdContext to focus on just sports memorabilia. This addresses David Bain’s comment about Chitika’s eMiniMalls ad categories.

Ad Unit Look and Feel: The ad units are highly customizable by the publisher to fit in with their website’s design. Your ad unit look and feel only takes 2 things from the auction listing: the text of the listing title and the listing picture. The colors, fonts, spacing that are selected by a seller on eBay for their listing do not override your ad unit look and feel. This addresses part of Tom’s comment on how AdContext ad units would be not as blog-friendly.

Listing Titles: Tom also mentioned in his comment that listings have “Crap headlines followed by crap sub-heads!”. I’ll admit that listings titles (aka headlines) are totally controlled by the seller (after all they do apy for them) and some of them are not what you would call professional. But I will say that I believe the vast majority of listing titles are straight to the point and relevant. Note that economic Darwinism will be at play here. If a seller consistently uses odd listing titles and they negatively impact the seller’s business then it will be less likely you will see these odd listing titles. However, if the odd listing titles actually don’t harm or even improve the probability of a person clicking through on a listing, then do you really care if the listing titles are odd? Another thing I should mention is that the contextual matching system is not entirely dependent on the listing title to perform the keyword matching.

Contextual vs. Non-contextual: AdContext will actually let you create ad units that display listings that match keywords the publisher chooses. A non-contextual ad unit (sort of an oxymoron) is the result. Tom mentioned at the end of his comment how this is a good way of getting the “right ads without it being a ‘contextual’ system”.

OK, that’s it for the facts. I just wanted to give some general comments too:

I can’t comment on other company’s advertising system’s terms of service (TOS) but I hope you find AdContext’s TOS flexible. I know that at the end of the day publisher’s have to make an economic decision and pick the solution that monetizes the most efficiently for them.

Darren correctly points out that the 40-70% the publisher receives is not from the winning bid/BIN price but is from the revenue that eBay would take from the transaction. While his percentages seem small (the correct values are 2.6% to 4.55% using his 6.5% take-rate figure) a lot of eBay’s affiliates drive significant monthly revenues using this exact same payout structure. I’m not at liberty to disclose what they are though. But unlike other company’s we tell you up front what percentage of the revenue we are sharing with affiliates.

There are several comments about the effectiveness of the system and the number of clicks it would take to deliver a revenue generating event. At the end of the day I would say publishers are most concerned about how effectively they monetize their inventory of page impressions. It all depends on the average selling price (ASP) of the eBay listings that you send your site visitors to. AdContext could be equally lucrative for publishers in high-volume/low-ASP and low-volume/high-ASP models and in-between as well. Publishers whose content matches well with eBay listings are likely to be the ones who moentize the best.

I would also like to mention that as part of the eBay Developer’s Program we announced a new API call: getContextualKeywords. This allows developers to access the backend technology that powers AdContext and to develop their own applications that leveral our contextual analysis system. Whether your goal is to build another advertising solution or something unique our system will analyze URLs that you provide it and suggest contextually relevant keywords in a rank ordered list.

Thanks for reading, hopefully I’ve provided you the information you need to decide to try eBay AdContext (http://affiliates.ebay.com/ads/adcontext/).

About Darren Rowse

Darren Rowse is the founder and editor of ProBlogger Blog Tips and Digital Photography School. Learn more about him here and connect with him on Twitter, Facebook, Google+ and LinkedIn.

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Comments

  1. razib says:

    Thanks for the post Darren. I missed the original comment and so it was useful for me. I am happy that the opportunities for us (bloggers) are increasing now on a weekly basis.

  2. pcunix says:

    OK, so it looks pretty good and I decided to sign up or get on the waiting list.

    Checked into eBay and went to the Affiliate area. It sent me to get a Commission Junction account.

    When I try to sign up there, that complains that I already have a CJ account.. maybe, I might have had one some time ago, so I’ll try logging in to CJ. Nope – no such account.

    So there I am – the man without a country :-)

  3. TDavid says:

    Ken has been at our blog too leaving a couple comments, though his comment here was much more detailed. CJ is one of several weaknesses in this program (and the API requires having a CJ account too).

    I don’t get it, eBay will pay billions for Skype and yet won’t design, build and implement their own first party affiliate program?

  4. Dave Starr says:

    There’s obviously still plenty shakeout before the eBay offering is well known to bloggers, but I certainly was impressed by Ken’s candidness and willingness to share facts and figures. If Yahoo had anyone who would spend half that time talking _to_ bloggers instead of _down_ to them, I’d be running YPN.

    It does amaze me what a sea of lemming the majority of us are .. signed up with huge programs who won’t publish their payouts and won’t even let folks seriously discuss them. Strange. Kudos to eBay for starting the game with full disclosure.

    And thanks to Darren for taking the time to host this discussion, it certainly helps when principals and knowledgeable fellow publishers can get on the same page.

  5. David Bain says:

    It’s good to know that people in the know are reading your Blog or a regular basis, Darren.

  6. pcunix says:

    I certainly agree that CJ is a weakness. Actually, I think it’s worse: there is so much junk at CJ that it’s guilt by association: in my mind it cheapens eBay’s program a bit.

  7. Enrique says:

    I would like to join this program, but I’m fed up with networks like CJ and Linkshare. It is unbelievable that companies this big are still using these clumsy networks.

  8. pcunix says:

    Just to follow up on my experience trying to sign up.

    I heard from CJ:

    Thank you for contacting us with your inquiries. After searching for your email, you do indeed have a Commission Junction account associated with the email address [email protected] and the website http://aplawrence.com. However, your account associated with email address [email protected] has been deactivated on 2/15/2002 due to our dormancy policy. I apologize for the inconvenience. As stated in the Publisher Service Agreement, if any of our Publishers do not generate revenue for more than 6 months, we automatically deactivate them. This policy ensures that our network is efficient and beneficial to our Advertisers and Publishers. Since your account is no longer active in our network, your page will register as “expired” among the advertisers with whom you were previously affiliated. Unfortunately, deactivated accounts are not eligible for reactivation. Please sign up for another account using an alternate e-mail address since your email address [email protected] is already associated with a dormant account.

    Of course I had already tried that, and still was refused. Of course their policy ignores the fact that they (CJ) have lousy (lousy for my site anyway) programs which is why they never generated revenue – I canned them almost immediately.

    So.. looks like I can’t sign up with e-bay. Oh, well: their loss for partnering with CJ – bet I’m not the only publisher who became “dormant” and now can’t reactivate.

Trackbacks

  1. [...] done a reasonably good job.” save/share/explore: MyWeb | del.icio.us | digg it! | Sphereit [...]

  2. [...] Efter att Darren Rowse skrev sitt första inlägg om eBay AdContext fick han en mycket lång kommentar från en ansvarig person på eBay. Denna förtydligar en hel del ytterligare om programmet och dess möjligheter. På grund av längden återger jag inte svaret här utan länkar istället direkt till Problogger. [...]