Why Paid Posts & Reviews are a Good Deal for Advertisers & (Most) Bloggers
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Why is this important?
1. As I stated in my first post, I believe paid-posts are a disruptive market force in internet advertising . As with any disruptive force, there are those that will resist change. They’ve built businesses and lifestyles around a business model that rewards those few with the technical knowledge and communication skills to build large audiences. A business model that takes the finite capital available for internet advertising and spreads it over a broader base of communications platforms is naturally a threat to the businesses they’ve built through hard work and expert knowledge.
A relevant post encouraging a reader to take an action will always drive better ROI than a spam page filled with keywords without context.
2. Once advertisers become convinced of the ROI potential for paid-posts, more revenue will flow further down the food chain. The best and most influential websites will still enjoy strong advertising revenues, but the more marginal pages, along with websites that address niche markets, will see traditional advertising go away in favor of paid-posts. This will ‘thin-the-herd’ of the websites that aren’t providing value, ROI, to their advertisers. This is a good thing for everyone.
3. Obviously, opening a revenue stream to a broad base of websites will create opportunities for bloggers in the form of income for stay-at-home Moms, moonlighters, and will open business opportunities for ambitious entrepreneurs willing to work very hard to generate quality, content on a large scale.
4. Competition for those same dollars will force bloggers and websites to improve the quality of their total communications package - the writing will have to be excellent and seamless with the unpaid content, the layout of the site will need to be appealing without being distracting, and the level of discourse will need to improve.
5. Google is currently testing their cost-per-action (CPA) advertising model, which sets a higher standard for earning than the traditional cost-per-click (CPC) model. In a CPC model, Google and the website owner get paid for every click on a link. To make this attractive to advertisers, the price is typically very low, usually measured in pennies. Some webmasters have literally hundreds of websites that are nothing more than spam, relying in SEO tactics to drive enough traffic to make the 2% click-through-rates pay off. The advertiser pays whether the visitor takes an action or not. In a CPA model, the advertiser pays only when a specified action takes place, necessitating content on the referring website that drives those conversions. A paid-post combined with contextually relevant Adsense provides a superb opportunity to draw traffic, get guaranteed compensation, and enjoy a lucrative, and potentially long, revenue tail. A relevant post encouraging a reader to take an action will always drive better ROI than a spam page filled with keywords without context.
One of the best business lessons I ever learned was from the CEO of a small manufacturing company. he said, "Just show me how you will pay your own salary and benefits, cover the overhead associated with having you here, and provide me with an appropriate profit, and I’ll give you any job you want."
Applying this to any advertising model, if your post pays for itself, the cost the incurred in administering the post, and generates a profit, the advertiser will keep giving you all the money you want. Remember, he’s not a patron of your "art", he has a business to run and people counting on him to deliver revenue. With paid-posts, you have an opportunity to directly and materially benefit the advertiser and generate future business for yourself.
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technorati tags: Andy Beal, Paid Post ROI, User-Generated Content, Disruptive Force, Competition,
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