ValueClick bombed Q2, as a result of weakness in its performance-based lead-gen revenue, as predicted by RBC analyst Jordan Rohan last Friday, Rohan says this portion of the lead-gen industry is falling to pieces, as advertisers scurry away from practices that might come back to embarrass them.
ValueClick is not the only company making hay in this business. Before tarring others with a broad brush, though, we need to define terms. There’s nothing wrong with performance-based lead-gen per se (although it could all get hit in a general performance-based backlash). “Good” performance-based lead-gen might be an ad that says, “Click here to sign up for a promotion from Blockbuster”. Sleazy performance-based lead-gen–the kind that Rohan believes ValueClick was engaging in–might be an ad that says “CLICK HERE TO GET A FREE IPOD!!!”, and then sells your email address to a spammer.
It’s hard to tell which companies use “white” (transparent) performance-based lead-gen practices and which use “grey” or “black” (sleazy), and the point here is not to pinpoint the sinners. Suffice it to say that some of these companies have better reputations than others. We believe they all benefit, directly or indirectly, from performance-based lead-gen:
Datran Media (back-end email delivery)
Other companies that might feel some impact would be publishers that depend on remnant and other “non-premium” inventory (MySpace and many others), as well as the ad-networks that often sell it (24/7 Media, Right Media, Advertising.com, et al).