Judging from the comments and trackbacks on this site, a fair proportion of blog readers have a blog themselves. But how many of you regard that blog as your day job? There’s an interesting article about your chances of making money from blogging in the new Business 2.0, with a bold promise in the subheading: “here’s how to turn your passion into an online empire”.
The article goes on to focus on how TechCrunch, BoingBoing and Fark are earning a substantial amount of money, together with blogging networks like Weblogs and Gawker. These are, the article says:
Real businesses, with real revenue streams from real advertisers — not overhyped next big things with pick-a-number valuations based on selling out someday to some overenthusiastic big-media sugar daddy.
(you may recognise what looks a lot like a snarky reference to the recent story about Kevin Rose being worth $60mn in 2.0’s rival publication, BusinessWeek)
There’s a little bit of a problem with definitions here. Is a blog that’s entirely made out of user-submitted bits and pieces (Fark) a blog at all? Is a blog written by a team of people (TechCrunch, BoingBoing) still a blog, or has it become an online magazine? For me, many of the Technorati top ten blogs, like the Huffington Post, have definitely gone into magazine territory, or maybe even become an online newspaper. With smaller, close-knit teams, it’s more of a grey area. I think TechCrunch and BoingBoing remain united enough that they do qualify as blogs.
The point may seem like semantic nitpicking, but the difference in posting volume that a team can bring then acts as a multiplier on your page views, and so on revenues. Advertisers mainly buy on a CPM (cost per 1000 page views) basis. A blog with two authors ought to have at least twice the page views as a blog with one — there’s double the posts for regular readers and twice as many possible extra readers who are just occasionally drawn in by your headlines.
Moving on, there are two good reasons why blogs are starting to attract advertisers. In the first place there’s an attraction to the personal touch and the integrity of blogs: “their recommendations are highly valued by readers — which naturally has made advertisers take notice”. If you wrote a blog about motorcycles, for example, then there are two, maybe three, reasons why, say, Yamaha might be interested in advertising with you. It’s a relevant audience, and it also signposts the company as one that’s interested in supporting and talking with its customers. If you’re cynical, you might feel that there’s a lot more chance of positive posts about your company, or fewer negative ones, anyway.
Secondly, there’s much more money in the internet marketing space as a whole, and it’s growing all the time. While the article says Google adverts should not be expected to make bloggers much more than “beer money” in most cases, brand advertising is in a completely different league: “Web ad agency Organic puts ad spending on blogs at $40 million this year.[…] blog ad spending is roughly twice what it was last year. With overall Web advertising expected to grow by 50 percent to $23.6 billion in 2010, it’s certain that more and more ad dollars will land on blogs.”
Blog networks are a good way to share the costs, cross-promote and create large readerships from groups of blogs. The Gawker group of sites, for example, which include LifeHacker and DownloadSquad, did 60mn page views in June. Twenty reasonably well-respected bloggers working together in a network can afford to have salespeople representing them in a way that a solo blogger cannot. This is how Federated Media works, acting as an agent for sites like TechCrunch and GigaOm.
There’s also an admission in the piece that advertising on blogs doesn’t really lead to sales. Intel’s blog advertising campaign for its Core2Duo chips attracted click-through rates of less than one percent. Perhaps crucially, the advertisers have chosen to be on the sites for the benefit of association, being seen as a company that’s interested in the blogosphere, rather than for direct sales. There’s a big difference between the advertising potential of a blog, where readers have come in order to read your daily post, and — say — a computer review site, where they are actively considering a purchase. If advertisers wanted clicks, the computer review site would win hands-down.
This is crucial to the chances of most bloggers because there’s a very big difference between the readership of the top 100 blogs and the rest of the great unread. The top two answers in a Google search receive something like 80% of the clicks. If you’re in the Long Tail, one of the other 49 million blogs with information on the subject, then you aren’t going to get nearly as much traffic. If you get an advertiser or a sponsor, then it will be because that client wants to be associated with the grassroots of the subject you write about. And it doesn’t get much more “grassroots” than having fewer than 500 readers a day!
Sadly, though, I think this association advertising — the bloggers’ bonus — will be the first thing to disappear if times get tough. I’m not convinced that many organisations, and even more so their agencies, view good will and listening on quite the same level as new orders. I think they ought to, but at some point the fat financial controller gets involved and good will becomes a luxury. The positive side of that risk, though, is that — provided it isn’t your day job — it probably won’t really matter that much either.
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