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Posts Tagged ‘Newspapers’
Friday, July 15th, 2011
By Adam Ward 
I’ve written before about tying online and offline campaigns together. I figured it was time to give an updated post on that subject.
A few weeks back I sat down with Dave Oldham, CEO of O-CODES. Dave and I have both worked at companies that built software products for newspapers to track their display and classified ads. We experienced firsthand the frustration advertisers can have: They know offline advertising works, but they wish they could track the effectiveness the same way they can with online advertising.
Dave’s company is doing more to bridge the online-offline ad-tracking gap than any company I know. In the entrepreneurial world, we call this “disruptive technology.”
Simply put, o-codes are a way of attaching a trackable online component to an offline ad. Media companies can use o-codes to upsell their advertisers. So an advertiser running a TV ad, radio ad, magazine ad or billboard sign can add a number that viewers/listeners can text for a discount. It is kind of like a digital coupon. The advertisers can also choose to use QR codes in lieu of text numbers.
Even though advertisers still won’t know exactly how many purchases came as a result of the ads they ran (not all viewers that text the code will buy, and not all that see the ad and buy will text for the discount), they can take an instant pulse of whether that medium is the one they should be using for their ads. So if they are running the same ad on five different cable channels, they’ll know they can consolidate to a single channel if they find a much higher percentage of viewers texting the code from that channel instead of the others.
With traditional media companies feeling like they are constantly fighting against online media for ad dollars, this is one way they can use online technology to enhance the value that their bread-and-butter offline products are providing.
Tags: Ad Tracking, Billboards, Magazines, Newspapers, Radio, TV
Posted in Cross-Pollination, Traditional Media | Comments Off
Wednesday, September 29th, 2010
By Adam Ward
Something interesting is happening in the newspaper business. These days when people talk about the influence that online content and advertising exerts on newspapers, they focus on the negative aspects, which are plenty. But nobody seems to be talking about the online attention newspapers are getting for a markedly offline product: inserts.
Inserts are those slick advertisements that slide out and scatter across your floor when you open your paper. Sunday inserts often have more pages than the newsprint does. Newspapers like inserts because A) they don’t affect the layout, size and production of the paper (the advertisers pre-print inserts and ship them to the newspaper’s press facility, where inserting machines stack them neatly together and slide them into the news pages as they come down the conveyor belt), B) they get to charge per 1,000 copies inserted and C) they don’t care about the mess they make for the delivery boys and girls trying to put elastics around them, or for that matter, the readers.
For readers of the newspaper, inserts are a slight annoyance that must be dumped in the recycling bin along with the Travel (or in my case, Sports) section that will never be read. Readers may look at an insert if it catches their eyes, just like they do with ads on the pages of the paper itself. But for the most part, readers subscribe to the paper to read the news. A reader would never have multiple subscriptions to the same newspaper, because once news is read, it is old news, even if seen on a fresh sheet.
But for shoppers, a newspaper subscription may not be about the news at all. For shoppers, Sunday inserts are a goldmine. And if shoppers can get a good deal on one can of beans from an insert, they can get the same good deal on two cans if they have two identical inserts. And if a shopper normally eats five cans of beans each week, it may be cheaper to get discounts on five cans by buying five subscriptions to the same newspaper than it is to pay for all those subscriptions.
So buying multiple subscriptions sounds crazy, but that is exactly what is happening. Walk around your neighborhood some Sunday morning and look at your neighbors’ driveways. Many won’t have a newspaper at all, but I’ll bet you’ll see some that have up to eight copies of the same paper lying there. Congratulations, you’ve found a shopper. More precisely, you’ve found a couponer.
While there is nothing new about shoppers, inserts or newspapers, multiple news subscriptions does seem to be a new practice. And for that, newspapers have the Internet to thank. Specifically, they have bloggers to thank. Yes, the same people that are competing with newspapers for advertising dollars are helping them increase their circulations.
One silver lining of the sluggish economy has been the explosion of coupon websites and mommy blogs, many of which are making out quite nicely as affiliate marketers. Consumers are flocking to these sites to get deals on everyday items because they can’t afford to pay full price for anything anymore. And what they are finding is that many of the best deals (particularly on grocery items that people more or less have to buy week in and week out) come from coupons in the Sunday paper. Some coupon blogs even list all the deals you’ll find in the paper each week. And whereas many online coupons can be printed just once (making shoppers grumble when they find out too late that their toner has run out), there is nothing stopping a shopper from using two insert coupons on two of the same items.
I’m somewhat fascinated by this. Shoppers are going online to find deals. In an effort to provide information on deals wherever they can be found, bloggers are encouraging shoppers to buy multiple newspaper subscriptions (because ironically, like newspapers, the bloggers are trying to build readership on their sites by providing accurate, quality content). Shoppers are following the bloggers’ advice, which increases newspaper circulation, which newspapers can then use to attract quality advertisers. Newspapers are showing that they are still an effective vehicle for delivering advertiser messages straight to shoppers.
Newspapers are fond of touting both subscription numbers and readership. The conventional wisdom is that three people will read the same newspaper subscribed to by one person. I wonder how many shoppers buying multiple subscriptions throw a wrench in that metric. Ultimately, I don’t think it matters, since subscription and readership numbers are used for attracting advertisers (and justifying ad rates); and if people are buying multiple newspapers because they are planning on buying more products, I don’t think advertisers will have a problem with that.
Tags: Inserts, Newspapers, Shoppers
Posted in Cross-Pollination, For Consumers, Traditional Media | 2 Comments »
Tuesday, April 27th, 2010
By Adam Ward
A couple of weeks ago I attended a benefit dinner for the Daily Utah Chronicle. This is an annual event where journalism veterans mingle with University of Utah student journalists and raise some money for scholarships.
The guest speaker that evening talked a lot about the demise of traditional media. He approached the topic from the business side of media, particularly newspapers, and how the old business model that traditional media companies are still clinging to don’t work. This was not new information to those in attendance, most of whom come from the editorial side of the media, not the business side.
I kept waiting for the speaker to offer some solutions, but he essentially ended by saying he didn’t have any, but he hoped the students there in attendance would figure it out.
That got me thinking about what the students would say if they had been standing behind the microphone. They have clearly made a conscious decision to learn the craft of journalism, knowing that the industry associated with journalism is having a tough time. I don’t know what those students were thinking during the speech that evening, but I admire them for choosing their paths, despite such seeming opposition.
When I was a journalism student many years ago, I often had people ask me why I chose that field, telling me reporters 1) don’t make much money and 2) are disliked almost as much as lawyers. But as I look back on my career, I’m amazed at how well my journalistic training has served me. So for all the naysayers out there, I’m writing this post in defense of journalism.
Good Writing Never Hurts
In an age where college students write term papers the same way they text their friends, communication seems to be on its way to becoming a lost art. At least communication where the implied meaning is clear. Journalists are taught to write without ambiguity. I would love it if everyone I did business with wrote clear, concise, complete emails to me so I don’t have to spend time trying to interpret their meanings.
We live in an era where good writing skills are arguably more important than ever. Between email, blogs, text messages and Facebook, people as a whole are writing more than ever before. In fact, I would guess many people communicate more through writing each day than through speaking. But just because people are writing more doesn’t mean they are writing better. Journalists are, not surprisingly, excellent writers.
Journalists are Fanatic Fact-Checkers
Just being a good writer isn’t enough. With so much information available to us through modern media channels, it becomes increasingly harder to filter out the junk. Just because you read it on the Internet, do you really believe it? I’ll bet you’ve found completely differing opinions from “gurus” on the web, right?
Journalists are trained to double-check their facts and sources. Their reputations and livelihood depend on it. And as a side benefit, that training is fully transferable. Not all journalists write for newspapers. Think of how the world would improve if the technical writers who write documentation were as diligent in checking their facts as news reporters were, or how we’d be able to trust marketing campaigns if we knew they were written by trained journalists.
Without Content You Have Nothing
Whether new media or traditional media, the business side of any media company relies on its product, and its product is content. Although content can be video, podcasts, radio, etc., someone still had to write that content. So without talented writers, those companies would have no content. It goes without saying, then, that without training the next generation of writers and journalists, the quality of that content goes down the tubes. And if your content is not worth anything, how can you monetize it?
And it isn’t just the media companies that rely on writing for content. Even businesses that sell tangible products still have to do a lot of writing in the process. That’s why MBA programs require students to take a business writing class. In my responsibilities as a non-journalist, I’ve written software documentation, marketing brochures, video scripts, business contracts, website copy, product descriptions, and more (like this blog).
We Live in a Democracy
Last, I’d like to point out probably the biggest defense of journalists, and why it is so important for young journalists to learn the trade. Regardless of the medium used, we will always have a need for journalists. Our very democracy hinges on it. Most politicians don’t like reporters. And for good reason. If we as a citizenry don’t know what they are up to, they have little reason to keep our best interests in mind. And without committed journalists on the front lines holding the politicians’ feet to the fire, tirelessly fact-checking their stories and letting us know what’s going on in the world, nation and our communities, we would be clueless.
So I want to thank and encourage all the journalism students out there for learning their craft. Whether they end up using their skills in a newsroom or in a boardroom, the world will be a better place.
Tags: Democracy, Journalism, Newspapers, Writing
Posted in Traditional Media | Comments Off
Friday, November 20th, 2009
By Adam Ward
In today’s converged environment, simply diversifying your marketing campaigns across multiple platforms may not be enough. Beyond maintaining consistent branding across all media (which is always important), you need to tie the actual campaigns together. In other words, you need to use one medium to spur consumers to jump to another medium as quickly as possible. I call this cross-pollination. Here are some examples of how you can do that.
You’ve probably been in a retail store and seen a product display showing “as seen on TV.” That’s a simple way of tying a campaign together across two media. However, it is not a proactive tie. These campaigns could be a little more proactive if the television ad or infomercial mentioned the stores in which you could expect to see their products. But they don’t because it is easier for them to get a consumer to pick up the phone and order the product than it is for the customer to rush right out to the store.
One effective way of cross-pollinating is to use outdoor media to generate online traffic. Ad Hustler discovered this to be an effective, cheap way of getting people to his site. Although he couldn’t track directly which sales originated by people seeing his bus ads, he knew the number of people that would see his ad in a given month (billboard companies have this information for each location), he calculated that the cost per thousand (CPM) eyeballs was lower than what he could be paying to advertise online, and he noticed an uptick in his site impressions and sales during that month. So he had a pretty good idea of his ROI on running those billboards.
Billboards can be a wonderful way to promote your website. Depending on your niche, your website could be competing with thousands of similar sites. If you use only online sources for promoting your website, you will need to spend quite a bit of money for keyword searches, search engine optimization (SEO), or affiliate marketing. Even with that, you may still have difficulty standing out among the crowd. With billboards, however, you can stand out. Billboards get noticed, they have the advantage of repetition (people who pass them every day remember them), and because not every billboard is promoting a website, those that do are even more memorable.
Billboards are also good fits because, by the very nature of billboards, their messages need to be short and memorable. Drivers zipping by at 70 miles an hour have just seconds to see what your product is, understand it, be enticed to visit your site, and remember how to get there. If you can do that in seven large words or less, you’ve got a winner.
Unless a driver immediately types in your website URL on a handheld device after passing your billboard (which is unlikely, not to mention dangerous), you’ll notice that although billboards can cross-pollinate websites, the effect isn’t exactly immediate, and not perfectly trackable.
For more immediacy and trackability, let’s look at some cross-pollination of print advertising and mobile. Mozes is one company that, among other things, allows newspaper or magazine readers to get offers sent to their mobile phones. A restaurant, for example, would sign up for a “mob” account at Mozes. The restaurant then runs a print ad in a newspaper. The ad contains a keyword for readers to text. When the readers text the keyword, they join the restaurant’s mob (essentially joining the restaurant’s mobile mailing list), and in return will get a discount or other special offers from the restaurant.
It is kind of like taking coupons to the next level. Only instead of having to tear out the coupon, carry it around, remember to use it and feel a bit sheepish when you do, you just show the restaurant your “coupon” on your phone. And since you are now on the restaurant’s mailing list, the restaurant can continue to send you additional offers, so your lead is much more valuable to the restaurant than a single purchase from a coupon would have been.
Another cross-pollination technique I’ve seen popping up is the use of mobile tags, such as Microsoft tags. Mobile tags are like bar codes in that they contain unique information about a product, only better. They can take readers (taggers?) to a website that gives whatever information the owner of that tag chooses to give.
For example, suppose you are a music company and know that a music critic is going to be reviewing one of your new albums. You can pay the critic’s publisher to include a mobile tag next to the review on the page. If readers want to listen to a song from that album, all they need to do is “scan” the tag with their mobile phone. They will need to have a free tag reader downloaded first. When they do that, their phones’ cameras will recognize the tag and take them directly to a website where they can listen to songs from the new album, see cover art, learn more, download the album, etc. So this gives your consumers the ability to read a review, listen to the music and buy from you, all within seconds of each other.
Because advertisers can easily create their own mobile tags, you can create a tag specific to one print campaign. That way you can track your “click-through” ratio and sales. This gives you a way of tracking the effectiveness of your print campaigns in a way you’ve never been able to do before.
Tags: Ad Campaigns, Ad Tracking, As Seen On TV, Billboards, Convergence, Coupons, Magazines, Mobile Tags, Mozes, Newspapers, Radio, TV
Posted in Cross-Pollination, For Advertisers, Traditional Media | 3 Comments »
Tuesday, November 3rd, 2009
By Adam Ward
Thanks to the Internet, differentiation between media companies is blurring. Newspaper photographers now shoot video for their websites. Broadcast companies offer classified ads on their sites. Bloggers report local news, and news reporters blog.
However, when it comes to advertising on these different media, the available technologies still cater specifically to a single medium. Newspaper software differs from television software which differs from radio software which differs from online software. Because I’m most familiar with newspaper software and online software, I’m going to focus on the difference between those two.
Newspaper business systems (e.g. AdPro, MediaSpan, SCS) refer to themselves as ad-tracking software. Although they are correct insofar as they keep track of the booking, pricing, sizing and billing of ads, they don’t track the effectiveness of the ads. That’s a major difference from online ad-tracking systems. Another major distinction is print publishers are the ones paying for and managing the newspaper software, whereas online publishers piggyback on someone else’s software, usually at no cost to them.
Although business software is the most complex software used by newspapers, here’s a simple example of how it works. Once a newspaper gets a system up and running (which takes a lot of customization, training and money, by the way), the system knows the rates and ad sizes for all publications offered by that newspaper. Someone at the newspaper then enters an insertion order into the system. For example, let’s assume the ad is a 4X5 ad (four columns by five inches tall) that costs $20 a column inch. The ad-entry person finds the advertiser in their system, enters a new 4X5 ad for them, the system prices it at $400 ($20 X 20 inches), and saves it. Unlike online ad-tracking systems used by publishers through affiliate networks, newspapers control what they charge for ads running through their system.
Because the business system contains an accounts-receivable system, it will either place the ad on hold if the advertiser doesn’t have enough credit, or approve it. The ad-entry person can also enter a payment for that advertiser and apply it to the ad. The system allows newspapers to send out a monthly bill to the advertiser showing all the ads that ran and the total due. Once the advertiser remits payment, an accounting person will enter that payment into the system and apply it to the appropriate ads or invoices.
Some business systems also have modules for managing the actual creatives (the ads themselves), as well as keeping track of the orders for online ads. But they usually don’t manage the uploading of those ads, or tracking the customer responses to those ads. That’s where online ad-tracking systems come in.
Online publishers who want to place ads on their sites often use affiliate networks to manage the ad tracking for them. Networks can either be open networks or exchanges (e.g. Commission Junction or ShareASale), where the publishers are responsible for choosing which advertising campaigns they want to run, or they can be closed networks (e.g. AvantLink or Affiliate Traction) where the networks manage the campaigns for the advertisers.
Whichever type of network the publishers join, they will use that network’s ad-tracking software. Each network uses either an ad-tracking system they built in-house, or a commercial tracking system (e.g. DirectTrack or LinkTrust). The networks allow publishers to log into their tracking system. If a publisher joins multiple networks, the publisher will have access to all the systems used by those networks.
Once logged in, publishers grab the HTML code for whatever ad campaigns they decide to run. When they paste that code into their websites, the code refers back to the tracking software to pull in the creative for the ad, direct users to the advertiser’s landing page when clicked, and track the impression, click and ultimate lead or sale.
The publishers are also able to see the stats from the campaigns they run so they can see the number of impressions, clicks, sales and—most important—the commission they expect to receive as a result of running that campaign. Unlike newspaper software where only the newspaper has access to the system, both publishers and advertisers have access to online tracking systems so they both know how successful the campaigns are. Online tracking systems also differ from newspaper systems in that the advertisers are the ones that dictate what the cost of the campaign will be, and the actual payout isn’t known until after the campaign has been running. With newspaper ads, an advertiser knows exactly what the ad will cost before the ad runs. With online tracking systems, although the advertiser and publisher have an idea of what the cost for each lead or sale might be, the total cost is dependent on how the ad actually performs. That’s why affiliate marketing is also referred to as performance marketing.
Online tracking systems do a pretty good job of tracking ad performance (unfortunately there are still ways to defraud the systems, but that’s another topic), and they can tell you what the payout should be. But that’s where they stop. Unlike newspaper business systems that have robust accounts-receivable features, online systems don’t handle billing, receivables, etc. They expect you to export that data (or enter it manually) into Quickbooks.
Maybe someday newspaper business systems will track effectiveness like online systems, and online systems will handle receivables as well as newspaper systems. But the more systemic differences between the systems, particularly which entities have access to the system and which entities dictate the costs of ads, suggest we won’t see the blurring of tracking systems like we’ve seen with the blurring of the media themselves.
Tags: Ad Campaigns, Ad Tracking, Affiliate Networks, Newspaper Software, Newspapers
Posted in Online Media, Traditional Media | 1 Comment »
Wednesday, October 28th, 2009
By Adam Ward
If you’ve never advertised your product, service or business before, you might find the world of advertising to be daunting. You have a variety of media to choose from, each with their own advertising products, prices and lingo that aren’t necessarily intuitive.
You’ll find some basic information here that will help you wade through these waters.
Television and Radio
Broadcast media have a finite space (i.e. just 24 hours a day). That space is divvied up among programming content, public service announcements and ads. The ads you’d be buying are called “spots” and you pay for a fixed amount of time (e.g. 30 seconds). Although you could buy a single spot, it is much cheaper for you (on a per-spot basis) to buy a bulk of spots. Especially with TV, where the cost of producing an ad is so expensive, it wouldn’t make sense for you to run the commercial just once.
The cost of a 30-second spot will vary greatly among stations (based on the number of listeners), and among the time of day. Drive time for radio and prime time for TV will cost you a premium over ads in the middle of the night, for instance. So when you buy a package of spots, you’ll probably get your ads spread out over the course of a day, with a spot or two during more desirable times (or programs), with the majority of your spots being at less-desirable times. Be aware that even though you think you’ve purchased spots for a specific time, if another advertiser comes in and is willing to pay more for those spots, they can bump your ad out of that time slot. Because of the finite space for ads in broadcast media, the law of supply and demand are in full swing.
Outdoor Advertising
Like broadcast media, outdoor advertising has limited real estate. They can’t easily add a new billboard if they are running at 100-percent capacity. However, with billboards you can lock in the duration of your ad, so you don’t have to worry about another advertiser with deeper pockets bumping you off halfway through the month.
Billboard rates are determined by the number of eyeballs they deliver. So a billboard on a busy freeway will cost a premium over a billboard on a less-busy street. You usually buy billboard space a month at a time, and you can also get discounts for committing to run longer.
Print Advertising
Magazine ads are pretty straight-forward. They typically have just a handful of sizes that you can choose from. So a full-page ad might cost $X, a half-page ad would cost a little more than half of $X, and a quarter-page ad would cost a little more than a quarter of $X. Magazine ads usually include color in their prices because color ads visually enhance the overall look of their magazine.
Newspaper advertising is probably the trickiest to understand because there are so many options. The ads you typically see scattered throughout news pages are called display ads, also known as run-of-press (ROP) ads. Newspapers typically charge per column inch for those ads. A column inch is one column wide by one inch tall. So an ad that spans six columns and is ten inches tall is called a 60-inch ad. If the newspaper charges $X per column inch, you’d be looking at paying $60X for that ad to run once. If you want the ad to be in color, you will probably have to pay extra, either as a flat color cost, or an extra color cost per column inch. You can get discounts if you agree to run a certain number of inches over a specific period, or if you agree to run an ad a certain number of times.
In addition to running display ads in newspapers, you can run classified line ads (paying per word, per line, etc.) or classified display ads, which price more like display ads but run in the classified section. You can also pay for advertorials that are written to look like news content (the front page of a real estate insert, for example) but are written by advertising people, not the editorial folks.
You can also put pre-printed inserts into the paper. Newspapers will charge you a fee per thousand inserts. So if you decide to have the newspaper put in 10,000 of your inserts, and the cost is $X per thousand, you will pay $10X. You will also have to pay to have the inserts created and delivered to the newspaper.
Online Ads in Traditional Media
As you know, newspapers and broadcast stations also have websites. They run the same types of ads as other online publishers (e.g. banner ads and text ads), but they don’t always price the ads the same. Since traditional media companies are used to telling their advertisers what to pay for ads, they’ve adopted the same approach for ads on their websites. They usually charge one of two ways: per a fixed period of time (e.g. a month) or per impressions served.
The nice thing about these pricing structures is you’ll know about how long your ad will be online. If you pay for a month, you’ll be up for a month. If you pay per impression, the media company should be able to tell you what their average impressions per day are. Chances are you’ll also be able to deal with the same sales person for online ads as for the other ads you purchase with them.
The downside to this is you aren’t paying based on the effectiveness of the ad. Like running a radio spot or a print ad, you expect the ad to ultimately generate sales for you, and with online ads you have a better ability to track that your website visitors clicked through a particular ad, but if your ad doesn’t get enough people to your site to buy your product, you may pay for a lot of eyeballs that don’t do anything for you.
Online Ads in the Performance Marketing Space
Before traditional media companies even had their own websites, Internet publishers were hosting advertising banners placed through affiliate networks. The publishers (anyone with a website that wants to advertise someone’s product on their site would be considered a publisher), to a certain extent, were happy to take whatever money the advertisers were willing to push their way. And the advertisers, thanks to the electronic nature of the Web’s marketplace, wanted to pay for actions, not just eyeballs.
Today there are hundreds of these affiliate networks that help pair online advertisers with online publishers. To advertise on these networks, you need to simply join the network. Most networks are free to join and you’ll have a network manager assigned to you. Others are more like exchanges where you pay to join, then post your campaigns on the exchange hoping to get picked up by the many online publishers in that network. You will have direct access to the publishers in an exchange, but probably not have any access to publishers in a managed network.
Affiliate networks are using the term “performance marketing” to highlight the fact that you’ll pay for actions, not just eyeballs. What you pay depends on what you are selling and the type of campaign you run.
If you are a bricks-and-mortar retailer, you will probably run a cost-per-sale (CPS) campaign. This simply means you pay a publisher only if a visitor on the publisher’s site clicks through your ad, lands on your site, and buys your product. When you start the campaign, you’ll tell the publisher what the percentage of each sale you will pay. So if you figure you can afford to pay 10-percent commission on all sales coming from a publisher’s site and still be profitable, your campaign will have a 10-percent payout. Publishers decide whether to run your ads based on 1) the payout and 2) how well the advertised product fits with the publisher’s site content.
If you aren’t selling a physical product, you may want to do a cost-per-lead (CPL) campaign. For example, if you are just trying to build up your email list, you might want to put an ad on a publisher’s site that entices a user to fill out a form with their email address. Once the form gets submitted, that lead gets tracked in a tracking system, you get the email address you’re looking for, and you then pay the publisher whatever amount you previously decided for that lead.
If you run performance campaigns through networks, you actually won’t pay the publishers directly. You will actually pay the network, which will then pay the publishers. The network will also have the tracking software that tracks your sales and leads. The network will provide you with a login to their tracking software so you can monitor your campaign’s activity and results.
As you can see, there is a lot to learn for advertisers in the traditional and online arenas. I hope this information has given you a good starting point for learning more.
Tags: Affiliate Networks, Banner Ads, Billboards, Cost Per Lead, Cost Per Sale, Magazines, Newspapers, Radio, TV
Posted in For Advertisers, Online Media, Traditional Media | 2 Comments »
Thursday, October 22nd, 2009
By Adam Ward
Out with the old media. In with the new. Traditional media companies are struggling to stay afloat because everybody and everything is online now. All you need to do is generate some online content (like a blog) and join an affiliate network. You grab advertising banners from the network, and the readers who find your site (because of your riveting, fresh content) click the ads, buy the goods, and you make loads of money. Sound familiar?
That’s the hype at least. The reality is quite different. Daniel Lyons, a Newsweek columnist who spent two years pretending to be Steve Jobs on his wildly popular blog, couldn’t do it, so what makes you think you can?
I don’t mean to take the wind out of your sails. It’s true that there is a lot of money swishing around the Internet, with more advertising dollars making their way to the Web all the time. (According to the census bureau at the Dept. of Commerce, eCommerce is expected to reach $300 billion in 2012.) I just want you to have realistic expectations if you decide you want to be a Web publisher.
It’s true that the barriers to entry are low enough that anyone can do it. It costs next to nothing to set up a blog, forum or website these days. And it’s true that there are hundreds of affiliate networks you can join where you can grab banners from online advertisers. But the ease of entry makes it that much harder for you to succeed. (How many musicians do you know who have their music on Facebook and MySpace, etc. but have never made a dime?)
So I apologize if I tricked you into reading this post thinking you’d get rich quick. After all, that’s what all the other blogs seem to suggest, so that’s probably what you were expecting, right? Rather, I want to give you some things to consider before you jump in. That way you’ll jump in with your eyes open. And you just might want to take some lessons from traditional media companies (yes, I know they are struggling too) if and when you do.
First, remember that content is king. I should qualify that to read “good” content. Look at newspapers. Even though newspapers have been losing readers, there is still a good reason why they can sell advertising space. Their readers are picking up the paper because of its news content. I believe that newspapers are the best organizations for generating news, and will be for many years to come.
One advantage of being an online publisher is your ability to generate news or other content at a hyper-local level. Although newspapers can report news on a local level, they will still cover general news at that level. Web publishers can provide information for small niches, but if the readers who are interested in those niches don’t find the site’s information to be valuable, they won’t be back. And with no readers, you won’t be generating any ad revenues. Just because you can place ads on your site from an affiliate network, if nobody is on your site to click through those banners, you won’t be getting any commissions from those ads. So your silver bullet would be to 1) have a site that covers a specific topic so well that it is a must-read site for people interested in that topic, 2) have ads on your site that tie closely to your content so that your readers have a greater proclivity for clicking them. Sure, newspapers will have mattress ads and plumber ads and personals because they have a general readership. You probably won’t (and probably shouldn’t) have a general readership, so don’t accept general ads.
Second, don’t rely solely on affiliate networks for your advertising revenue. Networks are great resources. They are a great way of getting relevant ads on your site by outsourcing that duty to someone else. And they should pay more than Google AdSense. But there is a personal element to selling. Advertisers like to know who they are dealing with. This is why local newspapers have such a great connection with their business communities. They have sales people interacting with local business owners constantly, and the business owners place ads in the paper.
If you have no interaction with your advertisers (and most affiliate networks won’t allow you access to those advertisers), you don’t have a lot of control over the ads on your site. You may get great commissions from an advertiser on your site only to find the advertiser is no longer associated with your affiliate network because the network rep who had the relationship with that advertiser left for another network.
To counteract this, you need to sell your site to advertisers directly. Yes, this is outside sales. Yes, you probably aren’t a sales person. And yes, it takes work. But business owners (or in your case, website publishers) are often the best sales people because 1) they understand their products better than anyone else, and 2) they are passionate about their business. They believe in it. And advertisers appreciate being associated with a business or website that the owner believes in and will be constantly improving.
That brings us to the third point: put in the work. Some people think that the rules of the real world don’t apply to the Internet. They’re wrong. Whether your business is bricks and mortar or virtual, it is still a business. And running a business takes work.
Tags: Affiliate Networks, Blogs, Newspapers, Newsweek
Posted in Online Media | Comments Off
Wednesday, October 21st, 2009
By Adam Ward
The biggest hurdle I see with traditional media’s ability to get a bigger piece of the online advertising pie is its reluctance to let the advertisers set the price for its ad space. Although I’m not advocating they let all their advertisers set the prices, they should allow some. After all, their competitors have been allowing advertisers to set prices for many years.
Before the Web, advertisers didn’t have the ability to say how much they would pay for ads. Broadcast media companies have always decided how much they would charge for air time. Although not all air time costs the same—a 30-second spot in the middle of the night is cheaper than during drive time (radio) or prime time (television)—the broadcast companies have a finite amount of air time available for ads, and they determine what those air chunks are worth based on their revenue needs and the demand from advertisers. Likewise, although print products have more flexibility in placing ads (the size of a newspaper is dependent on the number of ads running, so unlike the finite minutes in a day for broadcasters, newspapers can easily add an extra two pages to accommodate more ads), print media companies set the ad rates based on their revenue needs and the number of readers who will view those ads.
The Internet has turned these tables. Merchants who sell products online are now able to set a price for the banner ads running on online publisher sites. For example, a shoe store can join an affiliate network and tell all the online publishers in that network that it will pay an 8-percent commission to the publisher for all sales generated through that publisher’s site. So rather than publishers setting rates and trying to convince advertisers to run ads on their site, the publishers see what offers the advertisers have listed, see what the payout would be, and run the ones they think will work best.
Advertisers are able to make these types of offers because the Internet allows them to actually track customers’ actions back to the publisher sites where they originated. This is much harder to do offline. Except for infomercials where advertisers can track a spike in phone calls during the commercial, advertisers have a tough time knowing just how effective their traditional ad campaigns are. For example, they may know that six million cars pass their billboard ad each year on a highway, but they don’t really know how many of their customers saw that billboard, or whether it prompted them to actually buy something.
You can imagine that this has created an environment where online advertisers and publishers have different expectations than traditional advertisers and publishers. This might not be so bad if the online groups keep to themselves, and vice versa. But that hasn’t happened. Every radio station, television station and newspaper has a website where they are putting their content. And every bricks-and-mortar retailer that wants to stay in business has an online storefront.
Since publishers and advertisers need to work in both the physical and online worlds, they had better learn how to navigate both environments. And that means that traditional media companies need to start accepting some of their online ads from advertisers that are used to paying on performance.
I’m not saying that traditional media companies need to wholly adopt the performance-marketing approach used by online advertisers. If a newspaper can sell a banner spot on its site for $10,000 a month, it shouldn’t give that up for a cost-per-sale campaign that is not likely to make $10,000 in commissions that month. After all, a newspaper probably doesn’t have a demographic targeted closely enough to generate the necessary number of sales for a specific product to produce the kind of revenue they are used to producing in their print products. But that’s the kicker. If advertisers feel they can get more sales out of a more targeted online publication, why would they want to run ads on a newspaper’s site anyway?
The answer to that is, just like a stock portfolio, an ad campaign should be diversified. If a shoe store advertises its products just on a shoe blog, it will miss out on newspaper readers who don’t read shoe blogs but still buy shoes (and just might be in the market for buying shoes when they see the ads on the newspaper’s website). Although the shoe store may be able to track a greater return on the ads running on specialty sites, it could still be getting a good return on ads running on a more general site.
The same argument for diversification can be said for the publishers. A traditional publisher needs to fill its online ad inventory with traditional and online advertisers. Although the publisher will probably make more money off its traditional advertisers, every little bit helps. So if there is some excess inventory, the publisher is better off taking a commission of sales from online advertisers than letting the inventory sit with no revenue coming in.
I’m starting to see some traditional media companies adopt this approach on their Internet sites, but the majority are still sticking to their old way of running just the campaigns they sold directly to their advertisers. You can easily tell the campaigns apart. Go to your local newspaper’s website and hover over the ads. If the links reference the advertiser’s site directly, that ad was probably sold directly to that advertiser by a sales rep at the newspaper. If you see a redirect link (one that doesn’t look like it has anything to do with the advertiser) it is probably an online ad the newspaper picked up through an affiliate network. When clicking those ads, your click will be recorded by the network’s tracking software before redirecting you to the advertiser’s page.
Tags: Ad Rates, Advertisers, Newspapers, Radio, TV
Posted in Traditional Media | Comments Off
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