U.S. Consumers on U.K. Sites Are Untapped Market for Advertisers

International users now account for the majority of traffic to U.K. news and media sites, presenting potential opportunities for advertisers — in particular those targeting the U.S. market.

Over half of all traffic to all of the U.K.’s major newspaper sites in March came from outside the U.K., according to comScore. Advertisers are beginning to see the potential that buys on foreign media can offer.

“From an advertiser perspective, U.S. audiences on these sites tend to be more affluent, educated, and business-related,” said Chris Humphrey, European manager of international sales house AdGent 007. As a result, campaigns for verticals such as travel and finance are particularly successful,” he said, adding, “It’s by no means just an ex-pat audience, it’s more of a business traveler-type audience.”

Headquartered in San Francisco, AdGent has offices in London, New York, and Sydney. The company partners with U.K.-based news sites such as the Telegraph, the Independent, and Sky News, packaging U.S. audiences as premium inventory, and selling them to U.S. agencies through their local sales teams. According to Humphrey, remnant ad spots are sold through partnerships with DoubleClick’s ad exchange and ad networks. The firm does the opposite for U.S. sites, selling international ads for publishers such as Huffington Post and Conde Nast Digital.

Hitwise numbers released last month suggest international audience growth shows no signs of slowing, particularly in North America. According to Robin Goad, Hitwise U.K.’s research director, domestic traffic to British news and media sites grew eight percent between August ’08 and August ’09. During that same period, however, traffic from the U.S. grew by 54 percent.

The research firm also reports that more than a quarter of U.S. visitors to U.K. news sites come from California; New York State is the second largest contributor, accounting for 6.6 percent of visitors. In addition, Hitwise says Americans from households earning in excess of $150,000 are the most likely to visit British news Web sites.

Sohrab Ghoti, advertising director for the New York Times Media Group’s International Digital Media business, described success with selling directly to agencies and advertisers in local markets. Speaking at the Association of Online Publisher’s digital publishing summit held in London earlier this month, he said his company’s investment in local sales teams and relationships has resulted in a dramatic increase in revenue, and, he claims, the New York Times site is “being seen more and more as a local alternative.”

Despite the growing trend, relatively few major U.K. news publishers invest in local U.S. sales staff to monetize that traffic more effectively. Although U.K. publishers generate millions of U.S. pageviews, Humphrey argues the volume and reach of their inventory is simply not enough to compete with local players, or to justify investment in local sales teams.

“The Telegraph gives us around 90 million U.S. impressions a month. Although that seems a lot, those numbers don’t allow publishers to generate traction on the revenue side. We’ve managed to make inroads into the U.S. market and compete with the big U.S. players by aggregating inventory from a range of partners,” he said.

Humphrey suggests a U.S. publisher selling directly to the U.K. or Europe may not be faced with the same challenges as U.K. publishers attempting the opposite, however. “If they have the volumes, then it might make sense for them to do so,” he said. “It just comes down to reach and revenue.”