Advertising.com Follows Other Networks into Asian Market

The Japanese market has been no stranger to U.S.-based online ad players, and Advertising.com is the latest to make a foray into the large market. AOL’s ad network yesterday said it will partner with general trading firm Mitsui and Co. to operate a joint performance-based online ad network in Japan. This marks the first leap into the Asian market for Advertising.com, and its first joint venture.

“Our business is at a point where we’re able to make a commitment to move into the Asian market, because it is a major commitment,” said Dave Jacobs, VP of corporate development for Advertising.com. Until now, the company has operated only in the U.S., Canada and Europe. The new partners did not reveal financial terms of the deal.

Internet ad spending in the country last year surpassed 280 billion yen, or over $2.3 billion, according to Japanese ad firm Dentsu, by way of eMarketer Research.
The Tokyo-based network is set to launch in Q1 2007, with a focus on providing Advertising.com’s behavioral ad targeting and campaign optimization technologies, in addition to standard targeting offerings.

Whether the network will offer pre-roll or in-stream video advertising has yet to be determined, according to Jacobs, who said the company “definitely wants to understand it better” in terms of the Japanese market before deciding.

It also remains unclear whether the network will be a so-called “blind network,” or if advertisers will be made privy to which publisher sites their ads might run on. “We recognize site disclosure is always a sensitive topic,” Jacobs told ClickZ News. Still, the company wants to make sure revealing publisher names won’t be perceived as “competing with publisher ad sales teams.”

Mitsui already has an Internet services division, and this isn’t the first of its ad network ventures. In 2004, the company began employing FindWhat.com’s private label service for a now-shuttered pay-per-click keyword-based ad network in Japan called LISTOP.

The company also has invested in online firms including affiliate marketing company LinkShare and RSS feed platform provider Feedster. Mitsui’s tentacles extend into an array of industries including sales and marketing, retail and financial services, import and export, and international trading and manufacturing.

Asia has served as an outpost for ad network player 24/7 Real Media, too. The company last year aligned with large Japanese ad firm Dentsu to provide SEM services to Japan under the name K.K. 24-7 Search. The partners recently announced the expansion of that operation and a potential rollout into China, South Korea, Taiwan, Thailand and India. In addition, 24/7 provides its ad network and other services from a Japan office and has a location in South Korea.

Another competitor in the space, ValueClick, has dabbled in the Land of the Rising Sun; the ad network launched its performance-based ValueClick Japan network in 1998, expanding it to the wireless medium in 2000. In 2004, however, the firm sold off its interest in the operation to Tokyo’s Livedoor.

Behavioral targeting outfit Revenue Science in February forged a partnership with Japanese ad media, operations, and technology company Digital Advertising Consortium Inc. (DAC), through which the firm provides Revenue Science’s services to advertisers and publishers in Japan. DAC has relationships with MSN Japan, Yahoo Japan and Infoseek.

Yahoo and Google also have divisions in Japan.