Monthly Archives: July 2007

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MediaWhiz Is Building It’s Own Empire

I’ve talked a lot recently about the big dogs out there snapping up advertising companies.

However, it’s not just the huge players who are consolidating advertising companies. MediaWhiz out of New York completed their second acquisition of the year by purchasing AuctionAds.
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Microsoft Snaps Up Their Own Exchange: AdECN

Are things getting crazy in the online ad space or what? AOL buys Tacoda a few days ago, and now Microsoft has purchased ad exchange AdECN for an undisclosed amount. I didn’t think I’d have to update my chart from my Battle of the Online Advertising Superpowers post, but perhaps I might.

Who’s next?

Next Move In The Advertising Battles: Tacoda Joins AOL

As I’ve posted about before, there is a battle for online ad supremacy that’s quickly turning into a battle of superpowers. AOL just made the next move in the chess match with the acquisition of behavioral targeting display network Tacoda.

It’s definitely and interesting move as AOL already owns the largest display ad network in Advertising.com, which is also known to have behavioral targeting capabilities. This would lead me to believe that Tacoda’s behavioral targeting is superior than Advertising.com’s, or that AOL was simply after more advertisers, publishers, and people. Most likely it’s a combination of both.
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Clicky Interview on Centernetworks

Centernetworks has a nice background interview with Sean Hammonds who is one of the founders of analytics solution Clicky.

I’ve mentioned it before, but Clicky is currently my favorite blog analytics solution. It isn’t as high-powered as a lot of solutions out there, but it has a very usable interface and some nice features not seen in other applications. What’s maybe the most impressive thing though is that Clicky is self-funded and built by just Sean as the programmer, and his partner who handles business matters. Great applications can be made by a small team!

Direct Media Exchange Is a Year Old

Direct Media ExchangeThat’s right, the product I run for Right Media/Yahoo! Direct Media Exchange is now a year old from the date when we ran our first impression.

Much has changed. The name has changed, its parent company has changed, the stats have changed (up!), the visual design has changed, the networks participating have changed (added some more), the team has changed (grown!), but what hasn’t changed is our goal of helping publishers make more money from a free tool to help them manage their ad network inventory.

I’m proud of what we done and really enjoy working with our team. Here’s to another good year!

What the Heck is an Ad Exchange?

An experience today made it blatantly clear to me that being in the ad exchange business I take it for granted that I know what actually is an ad exchange.

I’m amazed, but it had never really occurred to me that most people think an ad exchange is more like a link exchange. Meaning that an ad exchange is a system where websites swap ads with each other. That really isn’t the case at all, but based on the words themselves and the concept of link exchanges I can see how people come up with that conclusion.
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A Picture’s Worth A Thousand Words

Scott Karp has an interesting post on his Publishing 2.0 blog today about how display advertising continues to lack relevancy over 10 years into it’s life.

Being in the display advertising business, you’d think I’d argue, but I won’t. He’s right, display advertising is still largely way too irrelevant and there is still a ton of improvement that can be done to help its relevancy. Yahoo! is taking steps in this direction with SmartAds, behavioral targeting helps, and as much as people get scared over companies having data due to privacy it’s a big key to helping ad relevancy.

But instead of really talking about what should be or could be done, I thought it’d be interesting to point out that even though display advertising on the whole isn’t very relevant today, it’s still amazingly profitable for both advertisers and publishers. Think about the opportunity here. If companies are making irrelevant ads profitable, what happens when display ads take the next steps in their evolution? Behavioral targeting will get better, the SmartAds concept of building ads on the fly based on user data, new technologies like Tailgate, and other advances should drive the profitability of display advertising through the roof for both publishers and advertisers.

People thought display advertising would die when contextual text ads started taking over the web, but instead it’s grown. Humans are visual, and seeing things can still drive a lot of response and interest when the eye doesn’t want to read a text ad. Perhaps pictures will be worth a thousand text ads after all?

Now I Really am a Yahoo!

I was a little premature back in April, because it takes some time for acquisitions of this size to go through, but Yahoo! has now completed the acquisition of Right Media.
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Is Time Spent the Answer?

I love web analytics and traffic rankings, but unfortunately the web still suffers from a lack of reliable and accurate comparison metrics between sites. Nielsen announced last Tuesday that they are ditching the page view in favor of the “time spent” metric. The question though is if this is a good thing?
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If You Want To Make Money Online, Don’t Blog

Making money through blogging is not a new concept. However, a recent set of blog posts and articles I’ve come across in the last couple of weeks taken together could make one think that if you want to make a living through the web that blogging is the best way to go.

First I ran across the Wired article about Mike Arrington and his success with TechCrunch, then it was Ken Savage and his Diabetes blog that makes $40k/year, and yesterday John Chow announced his blog income for June to the tune of over $12,000 in one month. Of course there are also some longtime bloggers like Darren Rowse at ProBlogger.net who actually specialize in helping people blog better and make more money doing it, while also talking about his own success of “six figure blogging”.

All of those are some impressive stories and I’m happy for all of them. They are not doing anything wrong by promoting their abilities in knowledge in helping people earn more money from blogging. Their stories are true, and they show that it is possible to make good money from blogging.

However, if you’re starting today, blogging is NOT the choice I’d recommend for people to make a living online. First, let’s look at why it’s such a popular choice right now.

Why is blogging popular for trying to make money?

1. Articles and blog posts like those mentioned above make blogs the “top of mind” choice because they are the hot topic as one of the newer and hipper publishing models for making money.

2. Blogs are receiving a lot of press and notoriety for their role in breaking news and changing the media landscape. This leads to the natural inclination for many people to want to join in on the “revolution”.

3. Social networks and other types of social media are getting people used to the concept of personal publishing and blogging before they jump in and do it, so blogging might be the most familiar publishing model to them.

4. Setting up a blog is easier than setting up an in-depth content site, affiliate site, ecommerce site, web application, or other venture on the web. It has a very low technology barrier to entry.

5. Blogging is more of an ego boost than other publishing types because they often are known as individuals instead of a company. Those who want attention are more likely to blog than to start an ecommerce site.

All these things make blogging a very popular choice right now, which is one of the reasons why breaking your blog out of the clutter to actually make significant income from it is so difficult today.

Why else is blogging not a great choice?

1. The low barrier of technology involved means almost anyone with a little skill can start a blog, and anyone with a little technical skill can make a unique blog. This is why there are millions of blogs today and almost every imaginable topic is currently being covered.

2. Since the vast majority of blogs are the same in format and technology, in order to succeed you need to be an amazing writer, a prolific creator of content, well-connected, a first-mover in a topic, be able to break news, or just get lucky. Some combination of those traits is required to get your blog traffic and links, and even then it’s no guarantee you’ll be able to monetize your blog well. Because….

3. Even popular blogs don’t necessarily generate a huge amount of ad inventory. In comparison to topical community sites, web applications, and social networks, blogs just don’t create a lot of ad impressions. It’s party due to the format of most blogs having a front page with all the recent content all on one page, and partly because even popular blogs with loud voices get a small amount of traffic compared to sites that hit the mainstream world.

4. Yes, there are other ways of making money from a blog besides advertising. There are donations (requires a big audience willing to give), ecommerce/affiliate (if you’re going to do this, is a blog the best way?), and blogging can lead to other opportunities like consulting or getting a job offer.

5. Even the most successful blogs pale in comparison in revenue and profit generated compared to top content sites, affiliate sites, ecommerce sites, and web applications. The top few revenue producing blogs I’ve heard of are in the 100-200k per month in revenue. That’s impressive, but not when you consider there’s thousands of no name affiliates, content site producers, and small ecommerce site operators doing the same amount of revenue and much better.

What should you do then?

If I’ve convinced you that blogging alone isn’t the way to make a living online, then you’re probably asking what you should do. The bad news is that the following suggestions all take more work than just signing up at WordPress.com and talking about your favorite topic all day. The good news is that the opportunities today online are still very big, but you have to go a little above and beyond the average blogger to make it work.

1. Pick a topic you’re passionate about. It’s much easier to put in time and effort about a topic that you really are interested in. Preferably, this area of interest also has advertisers, products or services to sell or refer, and content that can be created around it.

2. Evaluate what the best opportunity in that area is between creating a content/community site, becoming an affiliate in that space, or starting an ecommerce site. There are lots of great articles and sites around the web that teach you how to build sites of these types.

3. Learn how to outsource. Don’t try and learn how to be a designer, programmer, marketer, and all that on your own. Unless you’re really talented, it’s more likely that there are others who can do the work better than you and for cheaper than your own time is worth. Sites like elance.com, scriptlance.com, and specific forums in these areas are great resources to find people who are willing to do this work for you for a fee. Sure, it takes a little startup money, but not that much. If you’re serious about making money online, you’ll have to be willing to spend a few thousand dollars to get it going right. In the history of starting businesses, this is probably the cheapest opportunity ever.

4. At least master the basics of SEO (search engine optimization) and PPC (Pay Per Click) marketing. Both of these techniques are the top ways to get people to your site. Every website is dead in the water without good search engine optimization and/or the ability to drive traffic profitably through pay per click marketing. Simply by mastering PPC alone you can be an affiliate and find ways to buy traffic cheaply and send it to a simple affiliate landing page where you make more money than you spent.

5. Learn, learn, learn. The great thing about the web is that new technologies and techniques of doing business online are coming out daily. What worked two years ago doesn’t necessarily work today. If you focus on learning the new opportunities as they present themselves, it won’t matter much that you didn’t get started years ago.

Good luck.