Thursday, June 23, 2005

In search of a working revenue model

Yes, I know that some in the peanut gallery think the blogosphere should either be entirely "not-for-profit" or else limited to things like begging people to buy cell phone boosters so you can get a free iPod. Whatever. I agree that any income generated by blogging is going to be speculative, and I try not to let revenue-seeking overwhelm the larger purpose of the blog ... but I'd like to eventually turn it into more than an extremely marginal source of income.

Right now, there's apparently no "irrational exuberance" or "growing bubble in the blog advertising industry." Unless you're Glenn Reynolds, Markos Moulitsas ZĂșniga or Andrew Sullivan, you're probably doing well to pay your ISP bill by blogging.

I've been doing some thinking -- and some acting -- on this.

What do I have to work with? Not to blow my own horn (well, okay, just a little -- quoth Mencken, "he who does not toot his own horn, the same shall not be tooted"), but according to Technorati, I'm in the top 1/10th of 1% of the more than 11 million blogs they track, and about to enter their top 10,000. I'm running in the neighborhood of 500 visits and 900 page views per day on average, and that's going up. Google Page Rank, 5, up from 3 a month ago.

Obviously, I'm not in Instapundit's league, but 15,000 visitors a month is a pretty reasonable pile of eyeballs for advertisers to reach. I've sold a couple of BlogAds, and recently implemented Google AdSense. I'm constantly checking out other opportunities.

BlogAds is pretty much a self-selling thing -- if my traffic level and niche audience versus my rates look good to an advertiser, it's a done deal. I seem to be fairly underpriced in relation to the BlogAds affiliates with similar levels of traffic, and I plan to wait until I increase traffic even more to increase rates.

AdSense, on the other hand, doesn't seem to be working out so well yet. I've had a couple of days with close to a dollar's worth of click-thrus, but I'm averaging about 15 cents a day. At that rate, it will take about two years for me to wring a $100 check out of Google. I've done a little bit of reading up about how to game the system, but I'd really rather not spend all my time figuring out how to work terms like "home mortgage" and "Prozac"TM into my blog posts without ruining the quality of the writing ... and I also question whether that really works. Presumably, people who are looking for that kind of advertising are looking somewhere other than Knappster. Sure, they have higher rates per click-thru, but I'd rather have more click-thrus for stuff that my readers are genuinely interested in.

My goal, by the end of the year, is for Knappster to be bringing in $500 a month in income. I expect to have doubled my traffic by then, so it's a matter of wresting about 1.6 cents per month in ad and affiliate commissions out of each reader. That doesn't sound too difficult ... but I suspect it will be.


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