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The company I work for has a business model based solely around advertising. It's not 100% banner advertising, we run some bespoke campaigns (e.g. microsites) a
by corin_ 16y ago
The company I work for has a business model based solely around advertising. It's not 100% banner advertising, we run some bespoke campaigns (e.g. microsites) and do some events, but basically everything that isn't banner advertising is available to us because of the audience we have, and because we can promote it through banner adverts.
A few thoughts from our experience to some of the common concerns about advertising as a revenue stream. These are all based on our specific situation, so may not be applicable to everyone.
It's too hard to make money, you need way too many users
All our brands are content sites, we have around 1.5m monthly uniques and 20m monthly pageviews - with around 700k registered accounts across the different sites. From this we don't have a problem making a profit.
We sell at decent CPM rates (as in, not crazy cheap - once we tried filling spare inventory with Google adverts, we got $70 for the impressions we could normally sell for 100x that), and we handle all sales internally, no agencies involved. For that we have one main guy, our Director of Sales, who's amazing, and then for bigger campaigns I and one other person will often get involved to help out.
Because it is so hard to sell advertising yourself, that becomes the company focus
We have (I think) ten full time employees, and a few part timers as well. Between a few people, I'd say the total amount of time spent directly on the revenue side of the business (i.e. dealing with clients, making sales, and, for the bigger campaigns, then managing those) is the equivilent to two, maybe three, people working on it full time. That leaves us with plenty of work hours between the other people to deal with the business as a whole, technical issues and, most of all, content.
(Side note: we're not a content farm of any sort. Our sites are all based around video games or hardware, and they all started off as small community sites that were built up to have a good following.)
What helps with selling our own advertisements is connections. Because of our very specific audience, we have a good selection of regular clients ranging from smaller companies like Razer and Steelseries up to Activision Blizzard, MediaCom and Dell.
Your users lose out because your focus is not on them, but on advertisers.
(see thenomad's comment on this thread: http://news.ycombinator.com/item?id=2359089)
Editorial independance is very important to us, and we do our best not to blur the line between journalism and sales. We've never, for example, asked anyone to change what they write to suit us or a client, and never even felt the need to.
When it comes to the idea of chosing "how do we get more pageviews" over "how do we make this better", in our experience there's little or no difference. Obviously there are ways to add more page views simply by changing the structure of the site, for example multipage articles, but we feel that, if a change like that has a negative impact on users, then they'll be put off the site, and so it won't end up actually helping our pageview figures.
Actually, on one site we did implement multi-page articles, but only after a couple of years of not wanting to do it - and the reason we ultimately made the change? It kept being requested by users who didn't like seeing one huge wall of text.
Certainly in the case of content websites, if perhaps not others, pageviews is actually a very good indication of how the user experience is. If the quality and quantity of content is rising, so will the stats we care about, so it's win/win for both us and our users.
Edit: one more.
Advertising is a dead model, it doesn't help anyone
Our model isn't to keep finding new people to waste money, most of our clients have been with us for some time, and stay with us because they keep seeing a good ROI with us.
And at the other end, the advertisments are often useful for users to. Because of their targetted nature, a lot of adverts are for products/services that a lot of our readers are interested in. And for the times and people for whom that isn't the case, our adverts are all standard sizes, fit nicely into the pages and are perfectly easy to ignore. We don't do roadblock adverts ("sorry, you have to look at this advert and wait ten seconds before you can see our content") or anything like that. Well, we do have some preroll adverts on videos that we serve (again, we sell them all ourselves, and use our custom video player to display them), but we keep them short and offer users the opportunity to skip right through them if they wish.
- thenomad 16y agoI just checked your profile out - cool niche! (Apologies for not responding sooner. Still figuring the HN interface out and didn't see your reply to me!) I'm very much talking about tendancies here rather than absolutes. Certainly some very principled sites manage to keep their editorial courage - in the gaming community, for example, Zero Punctuation and Penny Arcade both run ads, and neither are afraid of pissing people off. But it's a dichotomy I've always found uncomfortable and difficult to reconcile with when running sites myself, and I think a lot of people have the same problem - you're to be applauded for managing to steer a straight path, and I'm sure you've had to fight to do it. (Indeed, you could view the entire content farming industry as a manifestation of the same problem - when your client isn't the person coming to your site for content, it's very easy to let the content slide.). And even in your company, at the end of the day, if there's a strategic meeting about how to increase revenue (assuming you need to), the questions you'll be asking will tend toward discussing the advertisers' needs, not the readers' (except in as much as you'll be asking how you can increase views, of course). I know this is an impossible question to answer, but in similar situations I've always ended up wondering "How much better would our services have ended up if any revenue-focussed meeting centered on our users/readers rather than our advertisers?" Incidentally, I'd strongly disagree that advertising is a dead model. And I agree that particularly in the gaming sector, it's possible to give users genuine value with some ads - my partner runs a gaming site and she's experimenting with the same model, with the same intention of giving users ads for things of value to them.
- corin_ 16y agoActually it hasn't been hard for us to do it at all. I think once we had a complaint from a client about some of our editorial coverage of one of their products, and they were told that it wouldn't change, which lead to them taking up an additional campaign to promote that product. It's never been a case of business and editorial staff fighting over it, if anything the business side of the company sees the importance of editorial independance even more than the journalists do. Maybe the fact that our communities are extremely opinionated and wouldn't think twice about calling us out as soon as we do anything they don't like makes it easier for us, I'm not sure.