9th Conference European Sociological Association

RN09 Economic Sociology

2009-09-03 09:00:00 2009-09-03 10:30:00 Thursday, 3 September 09:00 - 10:30 Marketization of Life Building AA, AA.228

Quality Conventions and Price Formation in the French Online Advertising Market

The online advertising market organizes the selling and the buying of the audience product. It organizes the matching between publishers with various products (various formats and environments) and advertisers with various intentions (branding or direct response). Moreover, this matching can be either direct ? very large publishers negotiate some of their inventory directly with major advertisers ? or indirect ? intermediaries such as ad networks, ad servers and agencies slip in between suppliers and demanders.

Many analysts predict that automated bidding systems, now mainly used by search engines will gradually penetrate the whole market and organize matching and pricing for display advertising. Moreover, online advertisers and publishers who currently engage in targeting to a relatively modest degree are expected to generalize their use of these tools (Evans, 2008; Goldman, 2006). Just like modern finance, these highly computerized tools are performative devices that are supposed to give rise to efficient markets (Callon, Muniesa, 2004).

Our study offers an empirical examination of of the French online display advertsing market. It leads us to qualify the vision of a fully automated and unified online advertising market. We investigated the activity of all the French ad networks recorded by the SRI (the union of online ad networks) and conducted 20 semi directive interviews with ad network managers and market professionals who resort to these ad networks (publishers, agencies, advertisers, targeting software developers). Observations and interviews reveal the plurality of coordination mechanisms that frame the matching between advertisers and web site publishers, and particularly the conventions of quality which support coordination. We summarize our findings, drawing from Salais and Storper (1993), by suggesting that there are four worlds of production within the online advertising market. The analysis of the quality conventions and the balance of power between them are used to explain several features of prices: their opacity, their dispersion and their fluctuations.