By Allan Maurer
MT. VIEW, CA—Meebo, the company that connects Internet users through a single buddy list where they can communicate in real-time across different instant messenger platforms, communities and social networks, has also come up with an effective new method to attract eyeballs to Internet ads. It works so well the company guarantees viewers will engage for at least 30 seconds with their ads. This, the company says, results in a click-through rate ten times higher than the average in the social media space.

Seth Sternberg, CEO and co-founder of Meebo, is one of 75 top Internet professionals who will participate in TechJournal South’s second annual Internet Summit Nov. 4-5 at the Raleigh Convention Center (see www.InternetSummit.com for more information or to register).

Founded in 2005, Meebo has raised $37.5 million from investors who include Sequoia Capital, Draper Fisher Jurvetson, JAFCO, Time Warner and KTB.

50 million users monthly
Sternberg tells TechJournal South that Meebo struck a chord with developers and site owners who want a real-time structure that helps them engage with their visitors. So much so that it now reaches 50 million users a month from Meebo.com and its partners across the web.

To make some money from all that traffic, Meebo also came up with a unique approach to grabbing eyeballs for the ads that appear on the Meebo bar or IM window. Traditional online advertising results in low click-through rates averaging about .1 percent on social media sites.

Why? “If you go to a web site,” says Sternberg, “You might spend 10 minutes there. With an average 30 seconds per page, in 10 minutes you’re probably exposed to something like 40 ads. “That results in a lot of impressions, but a really low click-through rate,” says Sternberg.

If you’re driving down the highway and you pass 40 billboards in 10 minutes, would you have any recollection of what the 12th was? Not a chance.”

Playing with time, not page views
When people are browsing a web page they’re paying attention to content and spending so little time with each ad you don’t notice them or click on them.

You probably don’t even notice most of the ads until the “moment of boredom” as a page changes. “Then you might notice them because they’re shiny and have bright colors,” he says.

What Meebo has done is keep the ad in front of the user for a period of time as he clicks through pages. “We’re playing with time instead of page views,” explains Sternberg. “That gets the ad in front of people when they’re bored and makes sure the ad is there when people are much more likely to notice it.”

Sternberg says Meebo suggests that advertisers measure effectiveness based on three principles: click rate, engagement time after clicking on an ad, and whether or not users share the message with friends.

Expansion of service in the works
Meebo’s ads average a click rate of about 1 percent, ten times that of the social media average, and hover just south of a 60-second engagement after a user clicks on an ad. About 10 percent of users share the message.

“Our goal is to get to a place where a brand can get a very large chunk of users across multiple web sites with one buy and also get these very good performance metrics,” says Sternberg.

With its ads performing ten times better than average, Meebo can and does charge more for them. “Those ads with the low click-through rates tend to go down to 10 or 20 cents cost per thousand impressions. Every campaign is different, but we play in the $10 per cpm zone,” Sternberg says.

He notes that the company’s revenue has been “Growing nicely in the downturn, ahead of our internal projections.”

Although currently focused on sites with a social focus, the company plans to make the Meebo bar available to sites generally in about a month. Then, visitors to a site will be able to interact with other visitors in a Meebo room and easily share content on the site with friends on Facebook or Twitter or other social networks. The company will split ad revenue with the site owners.

Online: www.meebo.com

Southeast Venture Conference, February 29 – March 1, 2012 at the Ritz Carlton in Tysons Corner, VA – Where Smart Money Meets Smart People.
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