Building A Vertical Ad Network Powerhouse: Glam Media CEO Samir Arora (Part 3)

SM: What is the story behind Glam? Where did the idea come from?

SA: Glam was interesting from the first concept. It started as a jewel of an idea in 2001 and developed in 2002 at the bottom of the downturn. A lot of people on the web were building web sites, blogs, or e-commerce stores under the concept ‘build it and they will come’ or ‘build it and then monetize it’, but it was not working. The founding team identified an opportunity to connect web sites to more users and better advertisers.

SM: It began as a horizontal play?

SA: Exactly. Glam started as Project X as an concept, then became “Project Y” formally as a company with a big idea – to bring brand advertisers online. We then focused on understanding and analyzing the problem. One of the first people I called was Jim Breyer at Accel, and I remember a 10-minute phone conversation with him – I was driving on 280 and he pulled off Woodside Road. He got it in two minutes, said it sounded like a great idea and encouraged me to go ahead with my investment.

We found what I would consider the single biggest change happening in the behavior of users today, which is something most people do not talk about. People think of the long tail as either individuals or professionals being able to self-publish quicker and faster, thus enabling more content on the web. What most do not recognize is that as a result of self-publishing, users are actually going to more sites. Everyone talks about the cause but they miss the entire effect that is driving this change.

Most people now have clusters of ten to twenty sites for their passions. If you like to travel you go to travel sites, if you love sailing you go to sailing sites, if you are a foodie you look for food sites. It is fascinating to me that nobody is talking about this being the first time in media history where distribution is no longer controlled by a few companies. That is a big deal. In print, magazines, books, radio, TV, and movies a few companies control distribution, but on the Internet, talented and creative authors, publishers, designers, video producers can create professional content and distribute it directly.

SM: You identified this trend when you started Glam?

SA: At Glam there are three critical aspects we identified very early on. First, Glam identified massive fragmentation in the content space. We also found that for almost every content area, there was no singularly large destination. In the early stages of the web, there were large destinations contrasting with small ones. We could not find one good destination in women’s sites that was reaching 2 million people. Fragmentation was wide and deep.

The second aspect we identified was that due to the change in distribution and the breakup of distributor power, publishers were becoming more important. Glam decided early on to launch a destination site that had a consumer brand, which was Glam.com and our owned and operated websites. We also launched a publisher network. This has made our company unique as we are vertically focused, audience focused, and have both a consumer brand and a publisher network from the start.

The third aspect we recognized was the need to be uniquely focused on brand advertisers. I was very fortunate to have hired Carl Portale, formerly the publisher of Elle and Harper’s Bazaar. Together, we visited the top brands directly. We asked them why they were not on the Internet. What I heard were concerns about the quality of editorial content which could be associated with the brand because the brand was important. Proximity to other brands was also important. Prada would ask if Gucci was there, Gucci if Prada was there. They also considered the distance from advertisers or brands that they did not want their brand to be near. Another concern was prime time or placement- magazine covers versus anywhere, anytime. Finally, they were concerned about what audience was engaging with their brands.

We realized something was fundamentally broken in the way display is done on the Internet. If you go to most web sites today and you just refresh the page, what you will find is a great ad by Neiman Marcus followed by ‘Hit The Monkey’, followed by ‘Get a Mortgage’, followed by a NetFlix ad or ads on sites that are never viewed or that are not communicating in social networking mode.

The last major medium created was television and cable. When that medium emerged, the focus was on prime time and brand advertisers. Middle-of-the-night remnant and advertorials came second. On the Internet this is reversed. There is a significant amount of ad inventory that I call sub one-dollar. This inventory is remnant and non-prime time. The problem is most that media companies are not technology companies. They are not able to differentiate between audience, context, behavioral targeting, prime time targeting, or placement targeting. Glam is unique because we monitor the placement of every ad on Glam and on our publisher network. Over time we understand what types of ads engage audiences differently. We started the company with the understanding that the packaging of content and ads, when done right, is extremely desirable to the point where customers want to TiVo the ads. Print and TV created a language to capture this idea of packaging, and the Internet is at the stage where it is about to be defined.

This segment is part 3 in the series : Building A Vertical Ad Network Powerhouse: Glam Media CEO Samir Arora
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