Blogonomics - waving the Banner (Ad) for a new New Media

While updating my notes for our upcoming summary report of Interactive Media Advertising, and the work we are doing with STL on Telco 2.0 ad-funded services, I enjoyed reading Guy Kawasaki's blog about being a Technorati Top 50 and making $4k for his pains from blogvertising

So, I started nosing around in the blogospere to see if anyone had done any work on the economics of blogging - or blogonomics.

The overall economics of blog production and distribution are covered by Larry Ribstein's Ideoblog - but I was really looking to see if anyone had looked at the actual money one could make.

Business 2.0 wrote this article, a very good survey showing among other things that Top 10 blog TechCrunch is making about $60k per month, a 10-fold rise over the beginning of the year.

How did he do it...well, the Business 2.0 article points to TechCrunch selling Display Ad squares, rather than relying on Google Adsense and Job Classifieds as Guy does.

There is this analysis by Amit Agarwal of the CPM rates that some of the Technorati top blogs are charging for Display ads.

There seems to be a lesson here - Search Ads seem to be better for "Long Tail" media, but good old Display Ads seem to be far better for the top end blogs - once you can deliver a predictable demographic, Advertisers seem to be happy to pay for less discretely measurable Ads. They may know that only half of it works, and they don't care after a point.

Now that is very interesting - for the last few years, the inexorable rise of Search Ads had seemingly confined dull old Web 1.0 Ad techniques to the outhouse. The idea is that search Ads, based on user "pull", are less intrusive and thus more desirable. Does this have its limitations, and after rapid growth is it finding its limits? That's a worrying prospect if you are a Google or Yahoo!

Whatever, this makes blogging look a lot like Old Media, so can one take some parallels? - Will the Big Blogs take Banner ads, smaller / regional / niche blogs will take (search based) classifieds, and will there be a number of subscription blogs dealing with very niche content?.

My take - not quite, as it is a new medium and is more interactive, so it does lend itself far more to interactive advertising. I do think blogging is more akin to magazine media than any other Old Style media, but it will work differently - we just have to find out how.

And with blogging as an industry predicted to double in value next year by some, whereas others say it is peaking - if not over after LeWeb3. However, Blogging was supposedly over at this time last year.

I think this one still has some ways to run...to me blogging now is much like the Web was soon after Netscape came out - there was a huge surge of user generated sites, then the emergence of the Web as a commercial system - and look where that got us....

(Postscript - Just found this - the comment stream in a Vecosys article here makes a few interesting posts about what a blog is worth as a media venture, and that they follow power laws like Zipf's Law)