Aiming to shake up the TV ad-buying process, nine major advertisers said today they are testing an online, open-auction marketplace to sell television ad time. The group, which includes Toyota, Wal-Mart and Microsoft, has hired e-Bay to help design the "e-Media Exchange," set to launch with a test in early 2007.
The advertisers, who are paying about $50 million for the test, say conducting business via an online auction will make TV ad-buying a more transparent process and give advertisers power to buy ads on their own timetable, rather than being restricted mainly to the upfront period.
At a time when advertising dollars have been shifting from TV to more interactive media like the Web, certain individual advertisers have been growing more vocal about their discontent for what they say is the archaic structure and timing of the upfront. Johnson & Johnson, for example, this year decided not to participate in the upfront market in favor of buying ads on their on timetable.
Advertisers have been talking about and working on the Exchange for months, having proposed the idea at an industry convention in 2004. Also participating in the test are some media buyers.
"We are in a rapidly evolving, increasingly complex media environment with a myriad of content choices and distribution channels," said one of the project's participants, Ann Bybee, corporate manager, Lexus Advertising, Brand and Product Strategy. "To be effective in the future our processes must embrace the advancements in technology and the benefits of our digital world."