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“Most ad networks know that direct response is still where the money is when it comes to display,” writes PaidContent’s David Kaplan. What he means is that advertisers will pay more for ads that cause customers to click, rather than those they only blink at.

Adknowledge, a privately-held company founded in 2004, has snapped up several other firms already. The latest, Hydra, specializes in “acquiring quality customers,” meaning the ones who’ll buy something. The Kansas City-based company has grown to a 220-employee business that touts its “powerful predictive technology” to serve ads to the right people at the right time. Adknowledge received $48 million in funding in 2006 from Technology Crossover, adding the company to a portfolio that includes CNet, eHarmony, Fandango,, iVillage, and Netflix.

“We believe that Hydra will allow us to achieve the leading position in the affiliate industry over the next 18 months,” CEO Scott Lynn said in a press release. The company’s plans are to create a dual-pronged ad network. Hydra will serve higher-priced cost-per-action (CPA) ads alongside Adknowledge’s existing chain of cost-per-click (CPC) ad networks. The goal, Lynn said, is to create a “must buy” for Internet advertising. Did you think Google had done that already? Think again.

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