ESPN Removes Ad Network from its site

Speaking of the value of Ad Networks…MediaWeek has reported that ESPN is removing its ad networks (Specific Media and unnamed others) from its website. They state that this proves the limitations of Ad Networks, but I disagree.  It is simply a matter of ROI…ESPN is selling an enormous amount of ads with its own in-house sales team and for the little remnant inventory that they have, if any, they are probably getting a higher ROI on promoting their own offerings than what they get from ad networks. ESPN has been promoting their fantasy games heavily (see their series of webisodes titled Endless Drama). ESPN is unique as it has a huge ad sales team, great content AND fantasy sports games to promote alongside that content. When ESPN was focused primarily on content and didn’t truly promote its fantasy sports games (which one could argue only changed as recently as late 2006 when ESPN purchased Talented Mr. Roto and Matthew Berry and hired Nate Ravitz from CDM/TQStats; Matthew and Nate have been business partners of mine and friends since I founded this company and they have both started and successfully sold their own fantasy sports businesses prior to joining ESPN), it made sense to generate incremental revenue for its remnant ad inventory by using an ad network…now they most likely earn a higher ROI promoting their own fantasy sports games.

I work closely with ESPN as well as CBS Sports with the promotion of our Draft Analyzer software. They are constantly optimizing the value of their promotional space for good reason…to maximize ROI.  My guess is that ESPN is now getting a higher ROI on its remnant ad inventory by promoting its own offerings than it received from the ad networks that promoted other companies offerings.  Most other large publishers do not have this breadth of offerings, so ad networks are a great way to earn incremental revenue from their remnant inventory.