I have been advising a blogger on her negotiations with three publishers for the sponsorship of her blog which has, in a relatively short period of time, accrued about 250,000 page views a month. This blog has a lot of buzz and attention paid to it, and she finds herself in the enviable position of considering multiple offers.
She has not filtered her feeds through Feedburner yet, so she has no idea what her subscription stream looks like. All she has is a SiteMeter bug which gives her a rolling 30-day view of the traffic. Based on that traffic, the publishers are coming back with offers more suited to the existing page-view/CPM model, looking for fixed placement of their message, a subscribe-link for their print products, and promotions for their own RSS products.
She has tried AdSense and a CafePress store, but essentially isn’t making a dime from her efforts. The content of this blog is unique, and is not comparable to any other source. It also has a significant barrier to entry for a competitor to move in.
My theory on what places downward pressure on CPMs is the concept of “fungible” — a twenty-five cent word for anything that is easily replaced by something else. In media terms this could apply to stock quotes, wire news, anything that is commodity content which the consumer would be hard pressed to identify its origin based on its tone and substance. In other words, if I covered up the source of a story on Reuter’s website about Apple’s earnings and showed it to a reader next to a similarly disquised story from the Wall Street Journal on Apple’s earnings, would the reader be able to identify the source?
Assuming the answer to the rhetorical answer is “no,” then one can see how a CPM on such a site will always trend lower as more venues begin to produce and publish the content. In the end, the most unique content that a publisher can claim is probably the opinion side — hence the movement of the columnists behind a cost wall at the New York Times with the TimeSelect program.
The question is whether a page view of a blog should be treated on an apple-to-apples basis with a page view of a magazine’s website. One offer values my friend’s traffic at an $8 CPM — which translates to $2000 a month. Chump change in my opinion.
I believe she can, and should, do two things to get maximum value for her efforts. First, avoid any ad network like Federated Media like the plague. Federated acts as a rep for traffic, selling it and managing the insertion of ads based on a demographic algorithm, and then reporting the results on the back end to the advertiser. They take a significant chunk of the revenue in the process. Anyone who has participated in an online affiliate program — Amazon’s for instance — knows what thin beer such programs can be. Second, she may want to consider an auction system where she lets the potential sponsors bid for the placement. How she can accomplish this, well, it’s beyond me.
So, what’s the recommendation? I felt in 1995, and I still feel today, that some online content will have such high value, and be so unique, that their creators will be able to eschew the tyranny of metrics and pageview economics and offer their stuff on a flat sponsorship basis sold purely on the basis of time, selling a patronage model that essentially lets the sponsor bask in the glory of the content and perhaps receive some business on the side. This is the PBS Nova model. Is the General Motors sponsorship of a PBS show an ad or a statement of corporate social responsibility or both? Expecting a low-traffic, high value content site to incorporate the kind of metrics and accountability and ad ops that a traffic behemoth has is ridiculous.
The hard part for my blogger friend who is on the verge of making some serious money, is how to negotiate these deals. She has published several books and has a longstanding relationship with a great book agent … who hasn’t the faintest idea how to represent her online efforts. There must be some agents out there who are emerging as strong negotiators on the behalf of online artists and talent, the question I pose is who are they and what are their terms?
Am I being naive in believing some web content stars can and should expect a sponsorship model, and that their efforts and pageviews are vastly different than a standard site’s?