Homing In on the Healthcare Consumer's Needs

The launch of Healthline Networks' HealthSTAT last week is one more indication that the Internet ad platform wars are far from over. To be sure, Google (Nasdaq: GOOG) remains the giant to beat -- and it looks as though it's settling into its role as the long-term dominant player.

However, HealthSTAT may be on the vanguard in the next significant skirmish within this multibillion dollar industry: the vertical front.

Healthline Networks is a medical and healthcare content community. HealthSTAT, or Health Semantic Taxonomy Ad Targeting, is a contextual, ad-matching engine that allows advertisers to post ads next to articles that are relevant to their products.

Its matching capabilities are based on health-related concepts, as opposed to generic or simple keywords. The matching can be general -- for instance, an ad for an antidepressant can be placed next to any article about depression. Conversely, the platform can be configured narrowly -- so that a particular ad will appear only next to articles about new medications for the disease.

"We have extended our health-related core capabilities to unique ad categories that we can use on our site or on third-party sites," John Lane, senior vice president of advertising services at Healthline, told CRM Buyer.

The platform is well suited for products that target a very specific disease, he added.

Tightly Knit Communities

The healthcare industry is one that is particularly amenable to the vertical ad platform concept.

"There is a different level of engagement with the readers at a health site, compared to another vertical -- like automobiles for instance," Jeremy Shane, vice president of business development for HealthCentral.com, told CRM Buyer.

HealthCentral.com has tailored its platform to take into account the progression of its readers' conditions. Someone who has just been diagnosed with lupus, for example, usually starts out learning as much as possible about the disease. The next step is typically researching available treatements. Ads can be tailored not only to match the disease, Shane said, but also to coincide with the patient's location on the learning curve.

The question is, do Healthline and its counterparts in the medical and healthcare industry represent the next step in online advertising? Or are these developments more illustrative of the peculiar nature of the healthcare industry's relationship with consumers?

Too Few Sites

Considering that five years ago Yahoo (Nasdaq: YHOO) was the giant to beat in the ad space, it might be folly to make long-term predictions. Some observations about the current state of online advertising, though, hint at what's to come.

There are more dollars than content to advertise around now, Carey Ransom, vice president of sales and marketing at WebVisible, points out. WebVisible markets Geneva, a software program that automates the keyword advertising process. "Companies are finding that there aren't enough sites to spread dollars to, so the addition of sites like Healthline is a welcome development.

Other verticals, such as real estate, and even micro verticals will begin to develop industry-specific ad platforms, he predicts.

Marketers are definitely interested in vertical ad networks right now, said Joelle Kaufman, vice president of media operations at Adify, a vertical ad network management company and subsidiary of Cox Enterprises.

Third-party research shows that people tend to spend the most time away from the top 20 Web sites. The move to vertical content -- on the part of consumers as well as advertisers -- "is an irreversible trend," she told CRM Buyer.

Too Granular

Still, it would be unwise for a company to assume that the move to verticals is stronger than it actually is, Thomas Harpointner, CEO of AIS Media, told CRM Buyer.

"I do agree that ultimately the Internet is going to break down into smaller and smaller components," he said. Yet basing an advertising strategy around micro verticals may be a losing proposition. "Healthcare? Sure. Real estate? Definitely. But, for example, doll house furniture? Not so much."