Avenue A Gunning for Industry Leaders

Online marketing firm Avenue A is gearing up to go head-to-head against the big players in online advertising, through a new unit designed to focus on sales of its software to advertisers and agencies.

It’s new operating division, Atlas DMT, aims to license Seattle-based Avenue A’s software to ad agencies and in-house media buyers. Called the Atlas Digital Marketing Suite, that software enables companies to serve and manage banner ad and e-mail marketing campaigns, in addition to providing customer targeting, profiling and analytical services.

Those are essentially the same features offered in DoubleClick’s DART for Advertisers product, which is widely seen as the largest force in the space. Another sizable competitor, CMGi’s Engage, runs a software division of its own, and Alley-based 24/7 Media is busily tweaking its own technology offerings.

There’s a lot at stake here, as technology is proving a lucrative area for the companies as ad sales revenues continue to decline. For instance, during the past several quarters, the majority of DoubleClick’s income has been through sales of its DART technology.

Despite the looming presence of bigger players in the ad-serving and management technology field, Avenue A — chiefly known for its banner campaign planning and optimization services — said its technology addresses problems that the industry has thus far failed to solve.

For instance, Avenue A’s president and chief executive Brian McAndrews said a lack of tools for planning, automated buying, optimization and analysis has damaged the Web’s reputation with ad agencies and traditional advertisers. As a result, McAndrews alleges that most ad serving and management software in the market is designed with the publisher in mind — rather than the marketer.

To combat this, the firm said it’s new software unit will promote Atlas as an online marketing and advertising package that has been designed with the advertiser in mind.

“Agencies are expressing a strong interest in a complete digital marketing management system that can help them successfully navigate the complexity of digital marketing,” said Atlas DMT’s new president, Tom Sperry, who joined Avenue A in 1999, after serving as managing partner for Bozell Worldwide and CF2GS.

Ad agencies “are looking to Atlas DMT to help them in this critical area, as our system was designed by digital marketers and perfected through three years of actual campaign performance,” Sperry said. “Unlike the other digital marketing solutions on the market, the Atlas Suite features a wealth of relevant services and tools that help agencies and media buyers lower costs, save time and improve online campaign results from day one.”

McAndrews, for instance, points to Atlas’ built-in planning, optimization and analytical tools; DoubleClick, on the other hand, sells media research and analysis separately from its DART offering, primarily through a new unit called Diameter.

“We believe our new corporate structure positions Avenue A, Inc. to lead the digital marketing industry,” said McAndrews. “With the addition of our Atlas DMT operating unit, we have significantly expanded our potential client base and greatly increased the market opportunity that we address.”

While McAndrew’s assertion has yet to be proven, he isn’t alone in suggesting the online ad industry’s erred by focusing too heavily on publishers’ needs rather than advertisers’.

Several industry groups, like the Interactive Advertising Bureau and the American Association for Advertising Agencies, are working to hammer out rules and “best practices” to make Web advertising more appealing to traditional marketers. The IAB and AAAAs, for instance, are creating guidelines to address discrepancies between publishers’ and third-party ad servers’ data — a problem that has persisted since the industry’s inception, but is just now coming to light.

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