content site revenue strategies

[rcjordan]

Increasingly, advertisers aren't satisfied with merely putting their names in front of a target audience. They're demanding a marketing result--a click on a banner, even a purchase completed--in return for their money. By 2003, Forrester predicts, 83 percent of online ad spending will include a pay-for-performance element, up from 62 percent today.

This is a shift several publishers feel captures only a part of the advertising story.

article here [internetweek.com]

[Drastic]

Interesting read.

I am constantly wondering, how many genuine-content sites can hang in there with ad rates where they are now.

I do see movement in this direction as positive to ad-sales recovery, but will it be enough to support content sites?

[gmiller]

I think the quantity of inventory needs to go down and the quality needs to go up. The little fixed-rate CPC networks need to go under (speaking of which, is eAds gone? Can't find any trace of those guys) and the survivors need to be more aggressive in limiting who they accept. Targetting options need to improve and the three of four small ads per page need to be replace with one big one.

I also think advertisers need to stop complaining about the ineffectiveness of animated gifs for branding purposes and start using Flash, Java, and JavaScript. It's not like the ad networks aren't offering it. Too many companies out there are going for the cheapest possible untargetted ads and then complaining that they don't work very well. Duh.

[gmiller]

> By 2003, Forrester predicts, 83 percent of online ad spending will include a pay-for-performance element, up from 62 percent today.

I meant to reply to this before, but forgot it :)

Anyway, all I can say is "Ouch!" That statistic strongly suggests that they don't expect offline advertisers to spend much on web advertising arrangements, since the CPC and CPA deals normally associated with "performance" don't really fit advertisers other than dot-coms very well. That could be very bad news for the next few years.

[Drastic]

>quantity of inventory needs to go down

I think one of the biggest issues with the ad market today is supply-and-demand. Many, many websites out there, with few strong advertisers in comparison. There are many dot-coms falling by the wayside, but I think they are just a drop in the bucket compared to how many are still out there wanting to sell their ad space.

I think this issue alone will make ad sales recovery take longer than any of us want it to. It just seems the ad space will always be there, advertisers can pick and choose and pay low-ball rates even when things start looking much better.

>statistic strongly suggests that they don't expect offline advertisers to spend much
I think offline companies will still advertise, they will just guage it like everyone else wants to. Like the ads on cnet you can explore on the page without leaving the site, that "exploration" of the ad can be tracked. Also, rather than regular CPM banners, when clicked the visitor can be sent to a form to receive more info via snail mail, gauging the ad performance.

Online advertising can work, the right vehicles just need to be found for online and offline advertisers.