Many of the most useful publishing formats and many of the most widely used sites are hard to effectively monetize. The solution is to use targeting technology and blend ads and content so closely that they appear to be one and the same. Many people have pushed this from many different angles.
This is somewhat of a rambling post about the merging of content and advertising.
Offline Ad Integration
I recently went to a hospital with a friend. While I was there I flipped open some magazine published by WebMD and read what was perhaps the most basic article on bipolar disorder ever written. The page long article had pictures added to make it two pages long, so the content wrapped around an advertisement for a bipolar drug, and there was even a quiz in there, which was not quite as overt as this Effexor one, but still pretty bad.
How Bad Does Google AdSense Suck at Monetizing Contextual Ads?
Many months ago as an experiment I created a backfill AdSense ad group where I bid a dime a click. Many of those ads appeared on Digg and MySpace and lots of blogs. The overall group had a 2 cent CPM. 19,083,546 ad views cost me $338.01.
Individual publishers can focus their content on expensive topics, but they still can't push the ads too aggressively in their content to their regular audience without losing some of their credibility and exposure.
Bloggers & Smaller Independent Publishers
There are many different takes on how individuals publishers can profit:
- Sell products or services, like I do here. The easiest thing to sell is something associated with your brand. Nobody is going to get mad at Discovery.com for promoting a Discovery toy store.
- Dave Winer suggests using authority and influence for indirect profit
- sell ads: contextual, brand ads, keep your main channel clean while creating an associated offers section on your site, or some combination
In many verticals advertising is overtaking the other monetization models. You only need to think back to the Wordpress Mesothelioma fiasco to remember how much people are willing to trade in their brand for a few dollars, and as long as Google puts a $0 value on your content then advertising is going to beat out paid content in most fields.
In Content Ads
With the flood of content in an endless number of formats advertisers are asking for more value than they did in the past. They want to be able to track the results, and they want ads delivered right in the content.
- Large trusted online publishers are already creating content specifically geared toward branded advertising experiences.
- networks like ReviewMe pay publishers for their attention, feedback, and reach - asking publishers to write honest reviews of interesting products and services
- Federated Media is pushing a concept they call conversational marketing, which asks known publishers to write on a topic and then puts a company slogan next to the quote. John Battelle is likely even going to write a book about conversation marketing.
- On top publishing channels Yahoo! buys ads distributed in content
- Google tells publishers to blend ads into content
- Google sell virtually unmarked inline text link ads, asks publishers to wrap the ads in content with a call to action, and opts publishers into the program without even asking their opinion.
Ads on Large Social Networks
Get enough exposure, traffic, and leverage and you can sell what you once gave away. This philosophy was core to Google's success, and also helped make Facebook wildly profitable. Facebook has done a good job of selling custom sponsorships. Valleywag found their rate card, and noticed that they are likely making up to $90 million on Facebook community sponsorships. There are many clever elements that make FaceBook's sponsorship program work so well
- there is only one sponsored ad on the page at a time
- the ad is put in content and formatted like content
- their ad unit format is so new that people have not yet learned to ignore it
- when someone clicks on an ad they still stay on the Facebook site
- after enough people join a Facebook group that brand gets free follow up advertising by having their brand located on other spots throughout the site, which leads to more sign-ups, which is similar to StumbleUpon ads, social media marketing, or buying organic SEO exposure with PPC ads. You buy enough exposure, mindshare, and traffic that people believe your brand to be credible and they vote for it too.
Facebook is getting some blowback from advertisers about having their ads appear next to some sketchy groups. Of course even if they don't advertise next to those groups they still support their existence by advertising on Facebook. But Facebook, like Google, has so much exposure that many brands feel they need to be seen there.
Behavioral Targeting & Interactive Ad Units
Any form of interactivity or any distribution model that becomes popular can become an ad stream. Google has beta tested making their ads more interactive, creating gadget ads, and allowing users to edit their search results.
Yahoo! and Microsoft promote behaviorally targeted ads. Google claims they are against the idea of behavioral targeting, but already use it, displaying ads based on past searches. Both Microsoft and Google have bought in game advertising targeting companies as well.
Having a large audience makes it easier to enter new markets. Last year Google spent $58 million buying marketshare giving away Google Checkout. Not only are they promoting themselves by carpet-bombing their SERPs with checkout ads, but they also rewrote their relevancy algorithms to boost the relevancy and exposure of any content on Google owned video websites. Many of these videos will eventually carry ads.
Google has also removed disclosure from many Google syndicated ads, which may lead some content readers to think publishers advocate certain lifestyle choices. Google, aware of the power of advertising, recommended HMOs carpet bomb consumers with deceitful educational messaging.
Paying for Content
Anywhere there is a believable story and an arbitrage opportunity someone is putting the pieces together to create profitable content. Colleges are hiring student bloggers, many sites grant a brief moment of exposure for contributing your content, Google is paying college students for gathering local business information, and there are a near unlimited number of business review sites.
How Does All This Relate to Me?
- You can look at how these various networks are blending and targeting ads to think of types of sites you could buy or types of content that you can make today that will be more profitable as the ad networks evolve.
- Some of these sites do an excellent job of ad integration to make the ads look like content. Emulate that on the profitable portions of your site.
- As the market gets saturated with free content sorting through it becomes more than most would desire to do. Central editors will be paid nicely, and the value of a strong brand goes up.
- If a market has few real competitors in it you can leverage wealth stratification, the desire to be important, and improving social software to take advantage of consumer generated content to create a backfill of information, knowing you can display ads differently to site members and non-members.
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