Bid4Spots’ Reverse Auctions Add Cable Systems

Bid4Spots, which has successfully played David vs. Google’s Goliath in working with radio stations to reverse auction off unsold airtime, is extending its service to local cable TV. The auctioneer will work with advertisers to let cable operators bid to place ads on networks. Cable systems generally have two minutes of inventory an hour.

As with radio, the reverse online auctions take place weekly on Thursday mornings for the following week’s ads. Mostly national advertisers take advantage of the reverse auctions, rather than local advertisers. Bid4Spots has appealed to radio stations because there is no revenue share beyond normal agency commissions (15 percent), the spots generally come pre-produced, and the funds are pre-cleared. More importantly, the radio stations are free to withdraw bids if they can sell the spot for a higher price.

Google has moved away from selling radio station time, where it had been frustrated by radio stations’ unwillingness to commit drivetimes and other prime inventory to its model. Instead, it is expected to reenter the market via Internet-based audio ads.