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Marketers are turning to blogs for online ad spending

Research out of Forrester is showing a growing interest to place advertisements on blogs and/or in RSS feeds. This should be no surprise, given the mainstream business coverage of blogs that has issued recently.

Of those surveyed by Forrester, 64% would be interested in advertising on blogs, while 57% would be interested in advertising through RSS. Both these figures represent more interest than advertising on mobile devices – this just shows which way the industry is set to grow.

Forrester estimates that total online advertising and marketing dollars will reach $14.7 billion for the 2005 year – that’s 23% more than in 2004. Banners/sponsorships will grow 11% per year to $8 billion by 2010. We’ll also see a large increase in spending for search engine marketing over the next few years, up to $11.6 billion by 2010. Online marketing spending is the only area of growth in advertising spending as a whole – so interest is definitely present.
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Blogging Data We Can All Learn From

The BlogKits 2005 Blogging & Advertising Survey is about to close up. Here’s the best part. I’m going to release the raw data from this study on ProBlogger.net next week for anyone to download and analyze as they see fit. So if you haven’t taken the short survey yet, please do, it will benefit us all in the end. There’s some amazing data in there.

Here’s a sneak peek. 80% of bloggers agree that advertisements are ok on their own blogs. 16% of those who answered were neutral on the statement, with a measly 4% or less saying they don’t think ads should be on their blog. I know for a fact that number was probably less than 30% just two years ago.

On the same note, 76% of bloggers feel that their readers are also ok with ads on blogs. While 15% stayed neutral, only 9% or thought different. Who reads blogs? Well, a lot of bloggers read other blogs. So it’s safe to assume that bloggers are also blog readers.

Finally, one of my most favorite questions. “I am more likely to click on an ad in a blog that I enjoy reading?” 84% of the respondents agreed to this question, while 10% stayed neutral and less than 6% disagreed. Seems like common sense right? The data would concur with that statement.

Should New Blogs Have Ads?

Jacob asks Should New Blogs Have Ads? He has decided not to put ads on his new blogs for two main reasons:

  1. Not much money – it takes time to build readership and in the mean time it doesn’t really earn much
  2. Bring in the Audience – ads can put off a potential audience. When you’re working on establishing yourself you want to give your visitors as few reasons as possible not to come back

Both are legitimate arguments that are well worth taking into consideration when you start a new blog.

I however take another approach to Jacob:

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64% of Marketers are Interested in Advertising on Blogs

Interesting feature by Reuters today into Blogs and advertising with some hopeful news for entrepreneurial bloggers who are good/lucky/workaholic/well-connected enough to generate large levels of traffic:

Buczaczer expects a handful of blogs will develop an audience large enough to secure more substantial ad dollars this year. A wave of companies will also start blogs to create more immediate links to consumers in the near term, he said.

As many as 64 percent of marketers are interested in advertising on blogs, according to a Forrester Research study, though their investment would still be a fraction of the $14.7 billion expected to be spent on Internet ads this year.

Another 57 percent are looking to include marketing messages on RSS (Real Simple Syndication) feeds which allow a viewer to see instantly updating headlines from news, Web logs and other sites via a simple Internet browser.

Of course the average blogger won’t generate the traffic needed to attract A-list advertisers – however as bigger bloggers break through and prove the value of blogging as a way to convey an advertising message I suspect that we’ll see more opportunities for the medium sized blog to surf the advertising wave also.

Blogads 3.0 Beta

Henry has just posted an interesting post over at BlogAds about some of the changes they’ve been working on in BlogAds 3.0 (beta). For starters they are refining their application process and introducing the idea of ‘sponsor bloggers’ who bring new bloggers into the program and help them get going (and get 5% of that bloggers earnings as payment).

‘So, going forward, bloggers will join blogads on the invitation of current network members, bloggers who, in essence, have helped beta test the Blogads idea and build the network. These “beta” bloggers will evaluate, invite and guide new blogads sellers. New bloggers (theta?) will pay 30% of ad prices to participate in the network, rather than the 20% fee charged current blogads sellers. A sponsor blogger, only a handful at first, will get 5% of her sponsored bloggers’ revenues while she remains a sponsor. Essentially, sponsor bloggers will be rewarded for doing some of the work traditionally performed in corporate publishing by both an editor and staff in the HR department. (To be clear, this means identifying, recruiting and acculturating stars, not managing!) Sponsors are doing work they are far better qualified to perform than we. (Once acculturated, new bloggers will be able to invite bloggers too.) ‘

Sounds like an interesting development that is designed to not only take some of the load of the central administration of BlogAds but that gives bloggers themselves incentive to recruit and coach other bloggers which will in turn should grow the network – both in terms of bloggers and advertisers.

I like the sound of what Henry is proposing. My only question is around complexity. One of the risks of tiers or new levels of contributers to any network is that it necessarily brings some level of complexity with it (at least initially). If I’ve learned one thing since blogging its that the vast majority of bloggers like things simple.

Adsense has boomed with Bloggers because its largely a matter of selecting a few simple options and cutting and pasting some code. BlogAds has a similarly simple interface (although initially I did find it a little more complicated than Adsense) – lets hope that BlogAds 3.0 retains and even improves upon this simple process.

Fastclick Launch Text Ads

An email was just sent out to Fastclick Publishers announcing that their new Text Ad program has just gone live.

We have exciting news to announce – we launched our new Text Ads ad format today! Text Ads are the perfect supplement to your current display advertising, using unobtrusive text with customizable formatting to fit your site-specific needs and generate additional revenue.

This is different to Google’s Adsense due to ads not being contextual in nature. This should mean that both ads can be shown on the same page as long as the Fastclick ads do not look too similar to Adsense ones (I guess this is open for interpretation – but I’d advice being careful).

Get more details on what this new program involves at their official press release.

Pajamas Media – Proceed with Caution

Duncan over at the Blog Herald has considered the new blog network being proposed by Pajamas Media (which I linked to a couple of days back). Duncan has taken a look over the documentation that Pajamas Media sent out to interested participants in the program and expresses a number of concerns with what he reads.

It seems that despite some of the concerns that have been raised that many have signed up for the program – Roger posts that over 150 have signed up to be a part of the network.

Duncan questions the legality of the documents sent out by the Pajamas Media team and points out that there is a 3 month exclusivity clause which stops publishers talking to any new advertisers and publishing networks. In a sense what bloggers are being asked to do is take something of a step out into the dark without knowing exactly what conditions Pajamas Media will offer. He goes on to talk about concerns with the secrecy clause in the contract, confusion between the two programs that they seem to be promoting at once and lastly about the right wing political nature of most of the bloggers behind this program and the implications that this might have.

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Cost Per Influence Advertising

Jason has a good post critiquing the CPI (Cost Per Influence) advertising that some have been talking about a bit recently. The theory is that some are trying to come up with an advertising system that rates ‘influence’ of blogs and connects this to the advertising rates that they are able to charge because of it.

It’s a nice idea – in theory – but as Jason say my experience is that advertisers are generally pretty smart at working out how influential a blog is by themselves – I’m not sure a CPI program would help them too much to do this. Jason writes it better than I could so I’ll just let him say it (and I’ll get back to packing boxes for our move this week):

‘To be blunt, as I’m prone to be, the CPI concept is appealing to those folks who don’t have the traffic to back up the claim that they are influential or who don’t want to wait till their traffic reaches that level. It also appeals to those who don’t have the ability or time to demonstrate to advertisers that they are influential.

One thing I’ve learn running online media businesses for the past 10 years is that people buy what they like to read. The advertisers in WIRED, Industry Standard, and the Silicon Alley Reporter were the folks who read the magazine and felt affiliated with it in some way.

Advertising is about affiliation more then influence. High-tech advertisers want to be affiliated with Engadget, hip companies want to be affiliated BoingBoing.net. Some day very soon advertisers will catch up with the highly-influential, but lower traffic, blogs folks like Doc, Jeff, Joi, and Kottke (who knows if these fine folks even want ads, but you get my drift).

When they do catch up it will be because of a combination of those folks increasing their traffic and their sales ability, as well as the advertisers finding them. It’s a natural process, and CPI isn’t really necessary to get it done.’

Pajamas Media – New Blog Advertising Network

Roger L. Simon has just posted anOpen Letter to All Bloggers announcing that he and a couple of others are going to start a corporate advertising service which will sell ads to advertisers ‘en masse’ . There are not too many details but it sounds like an interesting project. He’s doing the project with Charles Johnson (of LGF) and Marc Danziger (of Winds of Change). If the email for more information is anything to go by the new projects come under the name of Pajamas Media. He writes:

‘Charles Johnson, Marc Danziger and I have been sneaking around over the last few months, trying to turn blogs into a business. We have enlisted some others with names familiar to you with the intention of working in two areas – aggregating blogs to increase corporate advertising and creating our own professional news service.

With respect to advertising, we do not wish to go into competition with Henry Copeland’s BlogAds, which we fully support. (Some of us even have them!) We are working on another model that will sell ads en masse, not blog-by-blog. We expect this model to go live within a few weeks.’

It will be interesting to see what they come up with – as these are some guys who have some serious reach within blogging (two of them were in the top 30 I reviewed a few days ago).