Until recently, a principal business objective of publishing was to amass an audience that advertisers would pay to reach. A good publishing business plan clearly defined the audience and how advertisers would value the audience.
Bloggers are so enamored with their ability to publish without going through the gatekeepers of Old Media. But they could learn a thing or two about the publishing business from their stodgy progenitors.
The approach that most bloggers take to audience building is fostering influence among other bloggers on the same topic (which has been my approach thus far). The linking of the blogosphere makes this feel like a volume game, but it’s really not — it’s an influence game.
The problem is that bloggers are trying to monetize their audiences by size, but audiences at these microscopic levels have little or no value to volume advertisers. Sure, Google doesn’t care about audience size, but you’re lucky if Google shares a fraction of a penny on the dollar.
Witness Bill Burhnam’s sobering (and also hysterically funny) confessional of his blog economics. Bill increased his page views ten-fold, which by traditional media economics should have lead to a ten-fold increase in ad revenue, but instead Bill just managed to double his ad revenue. Even more sobering, in Jeff Jarvis’s own confessional about his blog economics, he admits that Bill does better than him on advertising revenue with a whopping $134.73 for Q4 2005. According to his site meter, Jeff’s site gets an average of 8,283 page views a day (don’t know if that includes bots), or about 750,000 a quarter. Yikes.
So what’s the problem here?
It’s that Jeff and Bill are trying to monetize their sites as if they were Old Media properties with millions of page views per month (or per day). Their audiences may be large by blog standards, but there’s virtually zero media value in audiences of this size when sold by volume. You can see the problem in Jeff’s appeal for readers to take his user survey so he can see how “richÃ¢â‚¬Â¦ and profligate” they are. Unless all of Jeff’s readers are millionaires, there’s no way he’s going to make a significant consumer play with his audience.
Mike May’s recent Online Publishing Insider column, The Sphere of Influence And The Small Online Publisher, provides an incisive analysis of the issue and is an absolute must-read for all bloggers:
Small publishers publish, in most cases, simply to be heard. Their end-game is not the media kit, but growing their sphere of influence. How many page views they generate, or the demographics of their readers, can’t accurately measure the volume and clarity of their individual voices. The metrics small publishers should pay more attention to are those that reflect the depth of their influence.
Traffic out over traffic in. Well-placed trackbacks and reciprocal links help drive traffic, but do little to measure influence. A better gauge is where small publishers are directing their own traffic, and how much of it they are able to direct. If a blog on local shopping and dining gets 20 percent of its daily traffic from Google, that’s a testament to Google. But if that same blog features a handbag sale at a nearby merchant, the percentage of its audience that clicks through to the merchant’s site is a clearer indication of the site’s influence on, and understanding of, its audience.
Small publishers should also pay attention to entry and exit referrers to see what other sites are serving a similar purpose, and where their own site fits into the choice set. If a local restaurant review site sees users bouncing in from CitySearch or Zagat, it has entered the game. Once its publishers see traffic exiting to CitySearch or Zagat, they’ll know they have the upper hand, and are viewed as a resource even before these well-established authorities.
Advice to all bloggers: stop trying to sell your audience like Old Media. Instead, sell your greatest (and perhaps only) asset: your degree of influence within your sphere.
Okay, how do you do that?
It depends on the sphere. For Jeff Jarvis, BuzzMachine’s sphere is media, so he should approach advertisers interested in reaching and influencing people interested in media. Who advertises in Folio? Or Online Media Daily? In Old Media terms, BuzzMachine is most like aB2B publication. Jeff should focus on cultivating a pure media-focused audience and compete with the mainstream trade publications.
Bill Burnham’s sphere is investing, so he should compete head-to-head with other financial publications. His analysis is much more incisive than what you typically find on thestreet.com.
But Jeff and Bill shouldn’t just sell their reach within their spheres — to Mike May’s observations, they should sell their demonstrated ability to influence their speheres. That’s something Old Media has a hard time demonstrating to advertisers.
For example, I bet Jeff drives a ton of traffic to mainstream media articles that he cites. That’s influence. Jeff recently wrote about Jon Fine’s BusinessWeek column, and probably drove a lot of traffic, but BW monetized it all.
Think of it in terms of reach — Jeff’s reach among all affluent consumers (by any definition) is probably tiny. But his reach among people who matter to the future of media is probably quite large. Much depends on his reach outside the bloggerati — bloggers should spend less time trying to cultivate other blog readers and more time promoting themselves as real alternative sources to mainstream media within their spheres.
Jeff may have more success as a member of Federated Media. Blog networks are clearly the other way to go — only time will tell how successful they are.
Sure, it’s not so easy as I’m making it sound. Perhaps bloggers can be take the respect and admiration of their fellow bloggers as the truest form of compensation. Or maybe take a job blogging for an Old Media property.
Jeff Jarvis wrote me with a number of important points. First, Bill Burnham only did better on AdSense, but Jeff made several thousand on BlogAds (which he does point out in his original post). I’d guess those advertisers understood the value of Jeff’s influential audience, which is not a direct function of its size. Second, aside from advertising, Jeff has monetized his influence through consulting gigs, speaking engagements, etc., which may well be the biggest opportunity for the best bloggers, to monetize themselves more than their audiences. Lastly, Jeff points out that he’s worked on these issues with John Battelle at Federated Media, which is evident in how they are positioning the value of advertising on influential blogs — the pitch to advertisers is very savvy:
Our blogs and their RSS feeds connect authors, readers and advertisers to a powerful conversation. One source of that power is the fact that — unlike at traditional media companies — at FM, the authors are in charge. They write what they want to write, and they retain the power to decline advertising from any brand that doesn’t fit their community. In an important way, then, FM’s authors endorse the validity of the ads that appear on their sites.
If you check out any of the sites listed as part of Federated Media, you’ll see high quality ads from brand name advertisers — certainly looks like the “influential” approach is working for them.