March 2008

Everyone knows what the holy grail of blogging is. You get 100,000 daily pageviews for writing three quick posts, and then you have your chauffeur drive you to the bank to deposit your ad revenue.

Everyone is also slowly realizing that this will only ever happen to Cory Doctorow.

The real question is this: for the average blogger, what are the revenue systems available, and how well do they work?

I recently had a chance to talk with Jeff Sable from Chitika, a blogger-centric ad network, and with Gail Bjork, owner of Digital Camera Help, which serves both Adsense and Chitika ads.

Here’s what they had to say about Chitika’s ad offerings, and how effective they were in comparison to other options.

With Jeff Sable from Chitika

BBS: According to your site, Chitika ads are “designed exclusively” for bloggers. How are they different from other CPC solutions?

Jeff: There are a couple of aspects of our ads that have allowed bloggers, as well as other types of publishers, to improve the content of their web sites while making great money. First, our ads feature targeted products. This means the blogger or publisher can focus on writing great and interesting content and Chitika’s technology will automatically serve a relevant product-centric ad to the end user who is reading the content. Second, our ads are designed to complement a web site and “fit” into the site without adversely affecting the relationship with the reader. Because of the combination of these particular attributes and other features of Chitika ads, bloggers in particular have found Chitika ads to excellent and Chitika to be a great partner as they build their businesses.


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One of the things about advertising on the internet is that it seems to blend more and more with marketing and with content.

Good, relevant advertising is content.

I was reading I forget what earlier today and I ran across an AmEx ad that was so awesome I took a screenshot of it, not that a screenshot will really convey the value:

What are you looking at? This is a screenshot of an interactive video display. If I clicked on any of the thumbnails I got about a minute and a half of video with Seth Godin moderating a discussion between Jimmy Wales and Sean Parker.

Awesome. I watched each video, and they were all interesting.

The point is this: AmEx might as well have written a blog post with some YouTube videos in it. I got the same value, and that was clearly an advertisement.

Good for AmEx, for using ad space well.

Good for you for blogging about your business, because blogging is a lot cheaper.

The team over at 24/7 Wall Street have come up with a list of the 25 most valuable blogs (although they don’t tack a number on all of them), and topping the list is Gawker Media, meaning the complete blog network.

How does the valuation break down? Here’s the blurb:

If the [Gawker] sites generate one-and a-half page views per unique visitor and the total CPM value of the multiple advertisers on each page is $20, Gawker is an $11 million business which is still growing quickly. The company does not appear to be staff-heavy, so it is imaginable that the margins on the business are 50%. Would the business be worth 15x revenue or 30x operating profits? Could be.

As far as the math goes, I’ve seen worse attempts at breaking it down. The list tails off at just under a million dollars for Talking Points Memo.

I’m sure they missed several big blogs, and I’m sure they’ve got many of them pegged pretty far from what price they’d actually fetch, but it does underline the fact that blogs are still working as media properties, even if they’re out of the spotlight at the moment. They’re drawing revenue, and if they were for sale, they’d probably be fetching good prices.

Many of you probably spotted this post on Gawker last week about the hypocritical “pay-me” blogosphere. A survey recently conducted by APCO on the “state of blog relations,” apparently suggested that bloggers are asking for a little palm grease from the PR industry.

I wonder if that was intentional.

This survey was distributed to bloggers and PR people in order to compare the responses from each group. Let’s look at the question that evokes that response. According to Gawker:

And the biggest disconnect of all didn’t really make the bloggers look like the righteous bunch. 96% of flacks disagreed with this statement: “It is okay to compensate bloggers for writing about my clients, but it is not up to me to tell them to disclose the payment.”

But almost half of bloggers agreed. They want to get paid, yo!

That suggests to me that the question on the survey looked something like this:

Do you agree or disagree with the following statement:

It is okay to compensate bloggers for writing about my clients, but it is not up to me to tell them to disclose the payment.

I smell confounding variables. That is a two-part statement, and I could choose to agree or disagree to either part, neither part, both parts, who knows. A better survey would have broken them out:

Do you agree or disagree with the following statments:

1. It is okay to compensate bloggers for writing about my clients

2. It is not up to me to tell bloggers to disclose the payment

I suspect that most PR people thought to themselves “well, I’m OK with paying bloggers, I guess, but if I pay them I’d better tell them to disclose the payment.” So they marked disagree.

Similarly, most bloggers probably thought to themselves “I don’t mind getting paid every now and then, but damnit it’s on my terms, it’s my blog, and I’ll decide when, where, and how to make a full disclosure.” So they marked agree.

Are there some bloggers who are out there to make some cash by being dishonest? Of course. Does this survey prove that “some bloggers” is 50% of the blogosphere? Hardly.

As Mark Twain once said, “facts are stubborn things, but statistics are more pliable.”

1. Your tagline is “just another wordpress weblog”

2. You’re on Blogspot

3. Your About page says “This is an example page”

4. You’re using the default template

5. You’re using a theme with the word “AdSense” in its name

6. Your permalinks end in numbers, like “?p=847″

7. Your posts end with “[souce: Engadget ]” or “Read original article”

8. Your readers get Carpal Tunnel from trying to scroll past the ads

9. Your posts are authored by “x9872ldy7d0-3″

10. You’re using a domain that ends with .info

Feel free to add yours in the comments…

Last week our friend Buzz Bruggeman pointed us to the New York Times article about being a “blogging star,” including a run-down of advice from popular bloggers like Mark Cuban and Xeni Jardin.

It reminds me of Calacanis‘ training video on how to become an A-list blogger in 30 days.

The Times articles is well worth a read even if blogging stardom isn’t what you’re after. There’s good, solid advice for everyone:

The hurdle that stops many would-be bloggers is fear of clicking the “Publish” button. Xeni Jardin, who juggles blogging at the quirky alternative-news site BoingBoing.net with a career as a freelance journalist for NPR, Wired magazine and others, resists the urge to polish her blog prose the way she would a radio script.

If you glanced at Techmeme this afternoon, you’ve probably noticed that fully half of the screen is devoted to Arrington’s rant about the VC money pouring into the blogosphere.

Most of the discussion is about who would make the dream team?, or, is Arrington just trying to rattle the boat?, or even making a bid for inclusion.

But what does this mean for business bloggers?

Money pouring into the blogosphere

This is going to sound similar to my answer to the next part, but here goes: 90% of all business bloggers will not be significantly affected. VC money is for media companies who aim to make their money by producing blog content.

You are blogging to create a connection with your customers, and to build a relationship that leads to trust, friendship, and hopefully, patronage.

The number of venture-backed, advertising-based media properties on the internet is not going to make much of a difference in your blogging. The same was that, if you’ll buy the analogy, a few new newspapers wouldn’t affect the way you go about conducting a monthly luncheon.

Should you network multiple blogs?

Again, wrong field. Don’t let Arrington’s call for uber-networkness tempt you to explore dividing your blogs.

Mike’s concept is interesting in itself: do blogs really offer the same product that the standard news media offers? I think the answer is a resounding no. I’ll let Paid Content speak to issues of factual accuracy.

The media-producing blogs will probably roll up in some way or another. Blog networks invariably seem to do better as a business than single blogs do. But again: don’t be tempted to follow that model if you’re blogging for a business.

Why would your customers want to see multiple blogs? The advantages of a network apply to companies trying to develop a media property: larger footprint, more ad inventory, diverse but niche topicality.

For the typical business blogger, these do not fall high on the list.

As always, Darren Rowse at ProBlogger has great advice for people who struggle with regularly finding interesting things to blog about.

All too often, a potential blogger will raise the very valid concern: “I’m worried that I’ll run out of things to blog about,” and some new media maven who has a literal hardline between their frontal lobe and the Comcast pipes running to their house will casually dismiss it: “There’s always something to write about. You’ll see.”

That’s not necessarily the case. It can be very helpful to schedule your editorial, and if you’re a blogger (or a potential blogger) who is worried about being regularly inspired, Darren’s post is well worth a read:

The first step in a journalistic system for blogging is having a plan for each month. Set up a spreadsheet, a table in a word processor, or a calendar on your desk - it doesn’t matter how you do this, but you need a monthly plan. On that plan you need to mark out the days you will definitely blog. This might be every day, just the weekdays, the weekends, every Wednesday - whatever works for you and your audience. Now you have a visual plan of what’s needed you can start filling in the blanks.

Essentially, he advocates mapping out, by month, the days you will blog and the topics that you will blog about.

If that sounds like too much work for you (it sounds like a lot of work to me, and as a blogger I am both inherently lazy and constantly wearing a bathrobe), you might try a more “intermediate” system like the one I like to use. It works especially well if you have a blog that covers a particular beat or topic:

1. Create a folder on your hard drive.
2. Whenever you run across a link that fits your topic, ask one question: do you need to blog about it immediately for it to be relevant?
3. If the answer is yes, blog about it.
4. If the answer is no, add it to the folder.
5. If you think of an idea not tied to a link, create a text file, put in the headline, and save it to the folder.
6. Whenever you do not know what to blog about, refer to your folder.

I have more data points relevant to yesterday’s post. Bottom line: Yes, you need non-trivial human involvement to go beyond 80 percent accuracy with unstructured content like blogs. Text-mining vendors claim that for many projects 80 percent is perfectly adequate though. Based on what I’m reading, I think there is likely a market for a process like ours that can automate the tagging and extraction/compilation of relevant content at high (90 percent plus) accuracy levels.

After drafting yesterday’s post about mining blog sentiment I discovered a Feb 27 post on the SentimentMetrics blog which reinforced what I’d heard from other gurus in the space. The SentimentMetrics blogger, (Leon? — posts don’t list the name of the author) says:

In addition, Mark Anderson responded to my post yesterday with a comment on his own blog. Anderson clarified:

“If you are working with longitudinal data, comparing month to month for instance, or comparing different products and brands then extremely accurate sentiment reading isn’t necessary as you are really looking for differences between groups. Additionally by considering the relationship between positive and negative sentiment in trended data (they tend to be positively correlated) when the correlation changes, in other words in one month for one brand you might see that negative sentiment increases while positive decreases, this signals a possible ‘event’ is occurring which needs to be drilled down into for further investigation.

However, for some of our clients in the past (such as Unilever), an extremely accurate level of sentiment was desired. Our methodology (AA-TextSM) relies on triangulation for validation, and we have sentiment accuracy in high nineties in most cases when applying this technique. Because most of our projects are ad-hoc in nature, the human factor is very important, so Anderson Analytics, more so than those companies focusing solely on a large volume of blog posts usually invest the time in perfecting custom dictionaries and understanding the special relationships between words in each project.

As you mention, many survey open ends are rather structured. On the other hand many are not. For instance if you ask a hotel guest to rate their overall satisfaction on a 10 point scale, then ask, why did you give this rating in an open ended question, you will get anything but structured answers. Our methodology has been used on other types of data as well though (call center logs, emails etc.).”

It sounds like the AA-TextSM system requires human involvement to customize the algorithmic process. In that last paragraph, Anderson attests that surveys can contain unstructured data. It seems to me that without getting humans involved (like to create custom dictionaries) you fade back to 80 percent accuracy when analyzing those unstructured portions.

If you live in Seattle, you ought to check out the Seattle PI’s big kahuna: The Big Blog.

Mónica Guzmán (who writes for The Big Blog) and I were having a discussion a couple weeks ago about whether or not what she does should really be called “blogging.”

There’s a whole list of things that she has to do that have nothing to do with the way that I post. What she does is absolutely, unequivocally, journalistically superior.

She checks her sources. I make up words. She clears posts with an editor. I am source, writer, and publisher. She writes about things that are verifiable. I operate on wild speculation.

Why in the world should what I do be given the same name as what she does?

No matter how many times we tell people that a blog is just the system you use to publish, the fact is that people have not separated the platform from the content in their minds.

It’d be nice if you could say “I’m a blogger,” and get the follow up question, “what kind?” — the way that if you said “I’m a writer,” people might ask, “for what? TV? Magazines? Newspapers?” — but you can’t. And ignoring that won’t fix it.

She does “blogging PLUS,” and I think that giving it a linguistic distinction is probably a good idea. Mark Cuban explains why pretty well in his post:

I’m sure the NY Times, like all major media outlets hopes that because it is branded a NY Times blog, that readers will have the perception and expectation that it will be of a higher quality than say, Blogmaverick.com.

That when readers actually read the blog, they will see that its of a higher quality than say, Blogmaverick.com. It may well be that some do. The marketing reality however is that there is a significant risk that they will not. That rather than assigning the brand equity of the NY Times to the blogs hosted, they will take the alternative path of assigning their perception of what a blog is to the NY Times, there by having a negative impact on the brand equity of the NY Times. That’s an enormous risk for any mainstream brand to take.

I don’t think it has to be “Real Time Reporting” (kinda lame sounding), but it shouldn’t just be straight “blogging.”

There are satsumas and there are oranges. I feel like right now we’re calling everything oranges.

OK, you can all tell me why I’m wrong now.

I’ve been spending a lot of time over the past few months researching companies in the “sentiment analysis” space. When we began developing our own process for categorizing/tagging blog posts with product and/or company affinity, we discovered that most monitoring systems take one of two approaches. They either take an algorithmic approach to text mining, or use a human tagging methodology.

Bottom line — have a computer “read” the text, or have humans do it.

I’m hearing conflicting reports about the pure algorithmic approach and its accuracy. Academic research largely attests that you can’t get much better than 80% accuracy when analyzing “unstructured” content. Others claim that the right algorithms can practically tell you a bloggers shoe size.

Our foray into this space started when a founder of one of the more prominent (and well funded) brand monitoring companies confided to me that their year-long initiative pursuing algorithmic sentiment detection was considered a failure due to achieving at best 80 percent accuracy.

Technical gurus at another well-funded and well known firm in this space confirmed in discussion the 80 percent figure for their algorithmic process.

Given their experiences, I wonder if most of these claims of highly accurate sentiment tagging using only algorithms is just PR spin.

Seth Grimes recently wrote an article on the subject that implies 80 percent is high on the scale:

We have developed a hybrid platform that provides human-level accuracy with the benefits of an automated environment. We’re doing exhaustive testing now, but we’re seeing accuracy way beyond 80 percent. Check it out here.

One company touting the algorithmic approach is SPSS. They work closely with Anderson Analytics who provides services in this space. It appears surveys are one of the main content sources they process — which seems like rather “structured” content to me. No doubt that boosts accuracy. Tom Anderson’s blog is here, and he discusses an upcoming webinar on the subject.

Relevant contributions on this subject can be found from bloggers Matthew Hurst, Stephen E. Arnold, Nathan Gilliatt, and Seth Grimes.

When I read about a “visual” search engine on TechCrunch, my first thought is “that’s probably a gimmick.”

In search, as with blogging, what matters most is what you put on the plate. If you’ve got great original content on a really crappy looking web site, you’re going to do better than a really good looking web site with really crappy content.

In other words, the prettiness and usability really is secondary. There are studies that conclude this (I’ve been told - never seen one myself).

But that doesn’t mean it’s unimportant.

Usability can only be ignored if your competitors are ignoring it too. I have this dream that one day, someone will go around on the internet and start a web site that offers the exact same (or better) content than an existing, ugly site. But this new site will be pretty, clean, and usable.

You want to smack your blogging competition? Write just as well, and make your site more enjoyable for the viewer.

This is why Apple is successful. They manage to consistently marry great design with good functionality.

According to George Dearing at InformationWeek, Acquia has raised $7 million to develop and sell a “suite of services it says will make Drupal enterprise-ready.”

In other words, Drupal will be getting the structure and support that many enterprise-level customers like to see.

Dearing is also absolutely right about the existence of social publishing opportunities, and I think he’s also right about the larger shift they indicate.

We’re starting to see more and more clients in the social media space looking to build ambitious and robust community systems on the LAMP stack, and we consistently recommend Drupal for the more expansive projects.

I think Acquia is making a good investment here.

Last week Jason Calacanis wrote a list of about 20 ways that startups can save money. It’s a good list with a lot of sensible advice.

Fred Wilson also went through the post, and added his thoughts to several of Jason’s points. I couldn’t agree more with Fred on this one:

Really think about if you need that $15,000 a month PR firm. - There are some really good PR firms out there and if you can get one of them to work with your company, then it may be worth considering it. But a mediocre PR firm is not worth it for sure. I encourage our portfolio companies to hire a person inside the company to be an “evangelist”. That job includes blogging actively, reading and commenting and linking to other blogs, reaching out to the media and industry analysts and gurus, going to conferences and events, and generally getting the word out. That person can be young and not particularly expensive, certainly nowhere near $15,000 a month. And they have two things that a PR firm cannot offer. They work for you and they represent your company exclusively.

I am consistently surprised when startups choose to forgo blogging as a PR strategy. A startup environment lends itself so well to blogging, and no other approach packs as much bang for the buck.

Fred is absolutely right that having a dedicated, energetic blogging evangelist will go a lot farther than a monthly contract with most PR firms. It will help create personal relationships between your company and your customers, give you an authoritative, authentic outlet for new information, and can create opportunities for feedback and community involvement that surveys and focus groups will never provide.

If you’ve been paying attention to travel, tech, and the blogosphere (or just Engadget), you’ve undoubtedly noted that the TSA recently caused Michael Nygard to miss his flight because they couldn’t figure out what the hell his MacBook Air was.

It’s a funny story.

I’m also willing to bet it’s an isolated one. MacBook Airs are probably zipping through security lines in airports all over the world. But it only takes one story like this to generate all kinds of negative buzz.

What not everyone knows is that the TSA does in fact have a blog: Evolution of Security. Their last post was March 4th.

Step up to the plate, guys. This is a perfect opportunity to respond and engage. You may even make a few friends if you do it right.

If you haven’t heard about “1,000 True Fans” yet, you should go read Kevin Kelly’s post.

In it, he argues (roughly) that that the Long Tail creates a problem for any creator: how do you make a living? Kelly’s solution is that an artist must find their 1,000 True Fans, and through the use of new digital technologies, rely on that “sweet spot” for a realistic living.

Or, in his words:

But the point of this strategy is to say that you don’t need a hit to survive. You don’t need to aim for the short head of best-sellerdom to escape the long tail. There is a place in the middle, that is not very far away from the tail, where you can at least make a living. That mid-way haven is called 1,000 True Fans. It is an alternate destination for an artist to aim for.

For the more detailed version, go read his post.

He writes for “artists,” but I think the concept absolutely applies to a business. In the digital “Long Tail” world, not every business can be a “hit.” But wallowing at the long end of the spectrum is not the only other option.

By using new technology — blogs, social media — you can connect with a core group of customers that will be your “True Customers.” They could provide a support base for your business and allow you to reach out and grow in different areas.

It’s an interesting idea.

One of the beautiful tricks you can pull on the world is to use the internet to convince people that you’re an expert in something.

In ways that people do not fully realize, the internet is incredibly democratizing. In order to be an expert, you don’t need a long and thorough record participating in a given industry. You don’t need to have credentials from any particular institution.

You just need to know what you’re talking about.

Maki over at Dosh Dosh does a weekly “advice column” based on questions that get sent in by readers. This week’s article is about how to build a reputation online. The advice is geared towards a student looking to build a name in the art field, but the branding advice applies equally well to companies aiming to establish a good online reputation.

Maki breaks it down into four big steps. I’ll let you read the article for the meat and potatoes, but here’s the dressing to get your taste buds wet:

1. Build a home base on the web.
2. Identify and participate in the right communities.
3. Initiate media outreach to get publicity for your brand.
4. Create online ventures to develop your net worth.

There’s a big article in today’s New York Times about Check Out, Wal-Mart’s employee-driven blog.

The NYT calls out the obvious:

Known for its strict, by-the-books culture — accepting a cup of coffee from a supplier can be a firing offense — Wal-Mart is now encouraging its merchants to speak frankly, even critically, about the products the chain carries.

This unusual new Web site, which was quietly created during the holiday shopping season, has become a forum for unvarnished rants about gadgets, raves about new video games and advice on selecting environmentally sustainable food.

Of course, in many ways it should come as little surprise to see a company plagued with bad public image in a digital age turn to blogging. Letting Wal-Mart buyers (people who choose what is sold in Wal-Mart stores) blog about the products sold at Wal-Mart is a particularly smart move, since it kills several birds with one stone:

1. Wal-Mart gets a set of public-facing personalities
2. Wal-Mart commands enough market share that bad-mouthing a product won’t force a supplier away
3. Wal-Mart appears to open up while not opening up at all

I’ll have to keep an eye on the blog over time to really back-up my third statement. But from looking it over the posts are talking about the products they carry, or products they might carry, or who they’re working with to determine what products they should carry.

They’re not really talking about anything internally Wal-Mart.

I have to hand it to the Wal-Mart team. That is a pretty smart move. It’s still an interesting blog, and I think that it’s a blog that will be well worth having as people learn to know and like the people who are blogging. After all, these are Wal-Mart employees!

It’s a good trick to think about if you’re worried about the risks of starting your own blog.