Ahead of the advertising curve
Sound Alliance was founded in 2000 by 20-somethings Neil Ackland, Libby Clark and Andre Lackmann. It has since been dubbed the “gateway” to 18 to 29-year-old Australians.
There are three distinct divisions of the Sound Alliance family, all of which play host to an impressive array of lifestyle and entertainment sites.
In the March quarter, the company saw 40% year-on-year display advertising growth, squashing the wider industry figure of 3%, and expects total revenue for 2011 to be around $9 million.
Sound Alliance is also in negotiations regarding capital-raising for further expansion of the business, both locally and overseas.
But long before it was thinking about international markets, Sound Alliance struggled to attract advertisers; a precarious position for a cash-strapped start-up.
“In the early phase of the business, Sound Alliance was a challenging product to sell to advertisers due to their limited understanding of the online domain,” Ackland says.
According to Ackland, advertisers viewed their offering as “silly little banner ads”, which no one understood or took notice of.
“That was pretty much the feedback generally across the board, so our competition at that stage was very much print,” he says.
“We were dealing with full page ads and magazines and street press and radio, and then online was just something you did for a bit of fun on the side. It wasn’t seen as core.”
“So trying to move it from being fringe and low value to being high value and part of the core proposition – to be honest, it really has taken 10 years.”
With regard to getting advertisers on board, Ackland insists it was “all about persistence”.
“We knew we had something special; we knew that we were on the cusp of something new and that there was a media revolution happening and we were right in the thick of it,” he says.
“Even though we were off the radar of what you would consider to be mainstream at the time, we knew we were getting hundreds of members signing up every day and all of the metrics we were seeing were amazingly positive.”
“We knew that it was just a matter of time and that we were quite far ahead of the game; we just had to be persistent and keep on trying.”
Ackland believes the company’s premature entry into the online domain meant it was able to portray itself as an industry pioneer, which resonated with clients once the market grew more competitive.
“Because we’ve been doing it for so long, I think we are really seen as being the leaders and the pioneers in the space... We have the benefit of history and data on our side,” he says.
“We really started to see things tip around [in] sort of 2004, 2005 when we started to get major brands on board.”
In 2004, Sound Alliance snagged Smirnoff as its first major client, setting in motion a steady stream of demand.
“That was a real milestone for us and then once we started to see that type of thing happening, awareness was quite high amongst the brands and a lot of the brand advertising started to follow,” Ackland says.
“We’ve gone from setting up a $1,000 campaign to multiple hundred thousand dollar campaigns in about four years. We have everyone from the Federal Government to Coca Cola to airlines to Myer.”
“It’s gone from being an alternative, fringe, underground [offering] to becoming quite mainstream and considered to a core channel for a lot of advertisers.”