What Every Advertiser Should Know

This article continues the conversation in our October cover story about serial entrepreneurs Heidi and Stephen Messer. NY Report editor Robert Levin interviewed the siblings, who founded LinkShare, a pioneer online pay-for-performance affiliate network, in 1996 and sold it for $425 million in 2005. Not content to rest on their laurels, the brother and sister are involved in two new ventures, Cross Commerce Media and World Evolved LLC. Both promise to revolutionize the way advertisers and marketers measure their campaigns’ success.

Robert Levin: There’s an expression in the advertising world: “I know half my advertising is working, but I don’t know which half.” Is that one of the problems Cross Commerce is trying to eliminate?

Stephen Messer: You know, it’s funny you mentioned that. That mantra—which came from [legendary retailer] John Wanamaker—was what we were going after for online retailers at LinkShare .  The whole premise of LinkShare was, “Well , now you know 100 percent is going to exactly what you wanted.”

Cross Commerce Media takes that exact same concept, and the same way of fixing it. We say, “Look, you have this connection with your customer. You send out millions and millions of mail pieces to them, but you have no idea what’s happening, even though you stuff it full of offers. So if we can take that and not only provide you with results, but also help you improve the results, then you’ve got something really exciting.”

We believe in all the magazines that are out there. Readership has never been higher. Magazines don’t have a readership issue, they have an advertiser issue. And that’s because advertisers look for certain types of targeting, tracking, and analytics that they get online in the offline world. They are looking for ROI, but they don’t know what their formula is.

Heidi Messer:  And that’s the problem we’re solving.

SM: We deliver that out of the box in a way that they’re used to—like, exactly the same screens they’d expect to see on the Internet, we’ve just brought to the offline media world. So that for them it becomes just another great ROI calculation, and just another way for them to do what they’ve already become accustomed to doing online. So we say, you know, when the world flees offline that’s probably an opportunity for us.

If there were a value investment for the Internet—which is  a weird concept because it’s such a growth industry—we’d probably be it. We ask, does the fundamental premise of why people are running from something make sense? So everyone says, “Oh, paper is dead.” And, you know, “Newspapers won’t be read any more – they’re going to go away,” even though local papers are thriving. Or they say, “Magazines are dying––good” Like they feel happy about it. They’re completely wrong.

It’s just the Internet industry, trying to figure out, “How do I get all the advertising revenue?” That’s why they want the print media to go away. But the reality is, it’s not going to go away.

We started by saying to ourselves, “Okay, can we figure out an additional incremental piece of information?” We recognized that the offline world had value, we just didn’t realize all the aspects of value until probably now.  We’re trying to give a marketer a full view of really what’s taking place. The sponsors of your magazine don’t realize the amount of value they’re getting.

They may think they do, but they really don’t, because the entrepreneurs who read your magazine, for them it’s their Bible. If you’re in that magazine and you’ve accepted that advertiser, it means it’s probably someone who’s going to add some value to their business. You’ve saved them an inordinate amount of time, of which they have such a little amount, right. And so to see [an advertiser] there means that they’ve been vouched for, which means you’re saying they’re a good player, that they’re going to do something effective.

So if someone were to say, “Oh, based on how many people bought off this magazine [advertisement],” they might get okay, you’re getting 30 percent of the value. But do the readers come back to the web? Did they tell their friends? Did they forward it to their friends? When they were thinking about something, and they had a choice and the pricing was about the same, did they pick the business they knew because it was someone who cared about their industry? That is huge value.

HM:   And you’re talking to two of the biggest believers in the internet. So for us to say this shows how far we think the pendulum’s swung in the wrong direction. The market is penalizing places that have unbelievable amounts of value. And our feelings are, if you can actually make sense of that marketplace it completely recalibrates the whole equation advertisers are looking at.