Google Rival Hopes for Its Turn

Posted by: Rob Hof on November 06, 2006

Who’s crazy enough to try to take on Google’s fearsome ad network? A little startup called Turn Inc., which my colleague Steve Baker had written about way back in February. Former Altavista CEO Jim Barnett briefed me today on what he calls the world’s first automatic targeting ad network. It debuts in beta test mode on Tuesday for advertisers, though the publisher side of the network will continue to be a closed beta until January. Turn has raised $18 million from Norwest Venture Partners, Trident Capital, and Shasta Ventures.

Barnett thinks current ad networks like Google’s, for all their success, have some flaws he aims to exploit. For one, it’s so complicated for advertisers that they have to hire experts like Efficient Frontier to figure out how to choose and juggle thousands of keywords. Also, those networks are mostly based on how many people click on ads, not what they do after that.

Turn has created a network it says is highly automated, using some 60 variables such as the content on a site, past performance of ads, and type of audience to more finely target ads to just the right people. People, that is, who are more likely go beyond just clicking to buying or at least becoming a lead, or a prospect for a sale, by, say, signing up to get email offers. It’s this cost-per-action idea that Turn thinks will help set it apart.

I can’t vouch for how well the system works, since I haven’t seen it in action. Barnett says more than 1,000 advertisers, ranging from SideStep to Performics, are using it already, serving about 5 million total ads to 30 Web sites. Turn gets about a quarter of what publishers get paid for running the ads.

Google is supposedly working on a cost-per-action network, so Turn likely won’t have that field to itself for very long. Over time, Barnett says, Turn will move to cost-per-click and other models. That is, if Google doesn’t crush them first, or eat them.

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BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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