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Sorry Robert, Advertising is About Audience Size First, Brand Sponsorships Later
Written by Allen Stern - December 30, 2007
Robert Scoble posted a message on Twitter this morning mentioning something about how audience size doesn't matter. Tonight I noticed a full post from Robert on the subject and I'd like to provide my thoughts on the topic.
He begins by noting that Perez Hilton has a huge audience but can't monetize it. That could very well be a poor sales team more than it is that he can't monetize it. Also, Perez is in a tough spot as advertisers might not want their product shown next to Britney's crotch. Perez has also used blogging to get other perks including tv slots and a tv show. In fact, I'd argue that in mainstream more people know Perez Hilton than combining the top 10 tech bloggers reputations.
Then Robert makes the following statement, "In the past few years I’ve had some success building audiences, but I found that that’s not really what’s important. It’s not what advertisers REALLY care about." He says advertisers care about three things: do you have unique content, does this unique content cause conversations to happen and does it get the most credible to link to you.
I agree that unique content helps but "big" can overcome this. Look at the top tech blogs -- are some of them "copy bloggers" now? Yet advertisers will still go to them first. And let's assume that I read major blogs a, b, and c. Blog A and B have the same content today, blog C has unique content. If I didn't know that blog C actually found the story on blog M, then to me the content on blog C is unique.
Now let's take a look at the "most credible link" topic. If inbound links were counted based on authority, then would the Top 100 on Technorati be where it is? Probably not. How many links are spam links? And who is to decide what's credible? Here's the bias that he doesn't realize when he makes this statement. He wants the top to stay on top and by this statement he gets his wish. In his example, he uses Make Magazine as one of the most credible in the do-it-yourself movement. But will Make be on top in 6 mos or a year? Who knows, but if we continue to always benchmark against Make, then no one else will ever be able to climb up to the top of the mountain and take over that "authority" slot.
The big issue Robert misses is that the ad business is still working from the audience-size phase. It's been this way since I started and 'they' aren't ready to move yet. When you signup for an ad network, they don't ask you who linked to you yesterday. They want your traffic numbers otherwise -- aka your audience size.
Would I love for advertising to be based more in the direction Robert discusses - hell yes. It would help CenterNetworks immediately. It just won't happen when marketers and advertisers want to buy in bulk rather than go from specialty shop to specialty shop. This analysis is based on managing millions of dollars in ad spend over the past 12+ years. And I do believe that CN is in the slot of getting ads based on reputation now.
Lastly, for Robert, he's in a different place than most. He's at the top of the mountain (some would argue otherwise) and so he doesn't need to fill the audience size question as everyone else does. Companies want to advertise with him because of his brand. Advertisers want to associate themselves with good brands but they must have a return as well.
Building your brand can lead to advertisers based on brand alone, Robert's absolutely correct about that. But for some that can take years and years and until you reach that point, it's only about audience size.
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Not really. But honestly: "In the past few years I’ve had some success building audiences, but I found that that’s not really what’s important. It’s not what advertisers REALLY care about."
I have never - in my entire life - met anyone who would be in a position to buy or approve ad buys who would agree with this statement.
Yes, of course it's great if the person/pub you're advertising with actually boils the water. And I'm sure Robert's ability to do that has an effect on ad decisions on his blog - or, as you say, his brand does. But if I had a million people a day on my blog (advertisers: it's true!) and Robert had 100, mine sat there slackjawed and Robert's interacted passionately every day (advertisers: again, true, call me), I would get the cash and Robert would get a pat on the head.
I'd love to know a martketeer that did that much research into a site they wanted to advertise on.
lets face it, most advertisers use a network to get their ads out there and don't care about where its shown just that it is working.
if he was talking about vertical advertising then hes talking some sense but I think this is another post where its a view of the world be looked at from eyes of Robert and not the average blogger (IE reality).
I think it'd be very interesting to do a podcast with you and someone like John Battelle about this topic. Certainly many advertisers DO care about audience size.
Sure, I'd be happy to do a podcast with you - just let me know where and when. Thx
I like your post and would like to add the following:
With the proliferation of information on the web, the time has come when the average user badly needs a set of filters to streamline the information he/she looks at. There are two ways this can happen, the user can depend on filters that are made by 'filter sites' or the site can be specific or specialized so that the information is already filtered. I place my bets on the latter and predict that sites like MySpace will become irrelevant because they contain too much 'garbage' information. This therefore leads to the conclusion that audience size will no longer matter because people will start to congregate at the specialized or 'niche' sites.
Advertisers certainly want audience size, but they ultimately want 'conversion'. Audience size may be the best way for many to get converstion (clicks, sales, impressions, etc). But for others, it means experimenting with smaller, focused, niche (vertical) sites that cater to specific crowds. They know that if they want to sell winter jackets for dogs, it's wise to go where dog lovers are hanging out. Advertisers that are selling a product with mass appeal will get out the blunderbuss and advertise on high traffic sites.
Alan,
I agree with your take. For most advertisers, it's still about how many people you can reach. Sure, content is apparently king but if no one visits your blog or Web site, you nothing to advertisers.
For many blogs, the biggest problem is they still believe great content will attract readers and advertisers. That may, in theory, be true but advertisers will only come on board if you have a big enough audience. And for blogs - a relatively new medium for advertisers - you also need to have a solid brand and credibility before they'll take the leap.
If you don't have an audience, advertisers won't waste their time with you. It simply doesn't make economic sense for them to spread their ad buys across 50 different sites rather than 1, to achieve the same level of reach. If they see you have reach then they're more likely to give you a try and then use ROI metrics to decide whether it's worth their time/money to continue.
Direct response advertisers want conversion ... period. As soon as they're hitting their target CPA, they want more and more volume. Brand advertisers look for audience demographics so that their brand isn't negatively associated with someone crotch, as you point out.
I'm sure Robert gets this. I suspect he's simply speaking from his world only though, which is different.
Perez didn't make money off of his YouTube videos. He makes tons off of the ads next to Spears' crotch.
i agree
Robert clearly doesn't understand how the "real" ad business works. He's living in small world where Silicon Valley technology personalities think they're at the center of the universe.
"In fact, I'd argue that in mainstream more people know Perez Hilton than combining the top 10 tech bloggers reputations."
That's probably an understatement. :)
My comments are at:
http://www.drama20show.com/2007/12/31/sorry-robert-size-does-matter/
Maybe Robert will prove us all wrong and ink a $250,000 ad deal with Proctor & Gamble based on all of the "conversation" he's created around his content. I won't be holding my breath.
Thanks for commenting Drama - no link love for me but for blodget? :)
I am looking forward to seeing what Scoble does next - I am guessing that TC will have the story on the 15th from CES.
that now if I had $250k to spend on budgeting I'd do it only for the press that this would generate - which would be an anamoly, but good PR nonetheless.
A lot of this depends on the advertiser's budget. The more money they have to spend, the harder it is to manage a huge amount in miniscule amounts, and easier to distribute through an ad network so long as results are happening. They want results, but they can also throw a lot of stuff out there and see what flies. For a smaller company with a limited budget, targeting the right audience is important for buyers, and getting eyeballs is important for branding.
I posed this question at the "new media" panel at SDForum a while back - if you have limited budget, where does your dollar go the furthest? Of course the answer from each speaker was: it depends (and didn't get much deeper than that!) A bad advertising $$ decision can really hurt a small company.
Of course Perez Hilton has monetized his audience. The guy has a television show on VH1. He gets paid to host events in the entertainment industry. He's got advertisers on his blog. The article Robert referenced was about Hilton's problems monetizing his videos on YouTube which seemed to be ad hoc and of low production value anyway.
Perez wouldn't have touched a high paying TV gig without proving to the networks that he had a big audience for his gossip items. Scoble's traffic isn't even close to Perez Hilton. If Scoble ever gets that kind of traffic I'm sure that he'll see that having a huge audience makes a difference to a lot of people who write checks.
I'll actually half agree with Robert. Advertisers do care about quality content and a quality audience (if they didn't, they advertise on MySpace for .25CPM).
However the problem for ad agencies and major brand advertisers is that they still need to reach huge numbers in order to be effective. Does the fact that Scoble has a valuable audience matter? Sure. But most advertisers will never get that far because they'd only be able to spend 5-10K/month on Scoble's blog (which isn't worth the IO the purchase is written on, in terms of paper-work).
This is why companies like b5 and FM exist: to pull together those voices so that (ideally) you have both fantastic content, really well targetted, as well as enough reach for it to make sense for advertisers, agencies and brand advertisers.
Btw, Perez makes nothing on his videos. But makes more than 300K/month off his blog. Size still matters.