Web 2.0 Sites and Ad Dollars

September 17, 2007 Dennis D. McDonald

In Analysis: Why Some Web 2.0 Sites Will Never Attract Big Ad Dollars, Edelman's Steve Rubel discusses data that suggests that certain "web 2.0" sites have poor ad selling potential. Here's a quote:

Based on a informal analysis, my belief is that many online communities, bloggers, social networks will never attract a critical mass of advertisers because they are not set up properly to attract visitors who have a commercial intent to buy products and services.

Rubel then goes on to say that "search" will ultimately serve as the basis for metrics that will support ad revenue models.

I'm not exactly clear what he means by relying on "search" since there seems to be a difference between people who come to a web site based on search and people who come to a web site based on some sort of prior relationship. That relationship-based behavior is what many "web 2.0" sites emphasize and what many marketers crave as they implement "communities" and other stickiness- and engagement-inducing "social" features.

Here is the comment I left on Rubel's original blog post; I recommend reading the other comments as well:

I'm not convinced that Search is the only way to go in relation to the phenomena you're trying to measure, particularly the "long tail" stuff. I'd say you have to measure both Search and Relationship. I base this partly on what I see with my own blog. Visitors basically come from two sources. First, they use a search engine. That's about 60-70% of the traffic. The rest come due to a link or relationship. I put those two in the same category since they indicate a prior familiarity.

One set of visitors comes because of Search. Only a small proportion of them do I think find anything relevant based on my review of their keywords. So most of those folks leave without really engaging with the content I have to offer.

The smaller group come here because of relationships -- they subscribe or they use a link from a (potentially) trusted source. Their expectations, I suspect, are quite a bit different from the "Search" crowd and I figure this also will help drive their results.

In summary, a visitor's prior knowledge and familiarity with what a site is publishing will predispose that visitor to certain actions and outcomes. So I would think that such factors might be relevant to setting ad rates.

Whether we are taking about a Search-based or a Relationship-based visitor, a major determinant of ad receptiveness will be the visitor's state of mind and predisposition, what I call "purpose of visit." Whoever comes up with an effective low cost way for measuring purpose-of-visit data together with visit-access-route and on-site-behavior data will be very popular, I think.

To see a list of other posts related to "metrics," click here.