Wednesday, January 27, 2010

Pax Venditum

Advertising peace
On today's Drudge Report, there's a link to a story about Newsday's efforts to sell subscriptions to its content on the Web, here. I don't know the full background of the story, but the gist of the article is that after three months, only 35 subscriptions were sold, traffic to the site is said to have plummeted, and with that drop in traffic it's fair to assume that the online ad revenues have fallen off as well because most advertisers are buying on CPM models.

To be fair, there's not a lot of information from Newsday, so they may be doing very well, and if so, that's great news, and they should be commended. There's not much discussion of Newsday's strategy in the article, either, so we are likely missing some pretty important information which could indicate that Newsday is succeeding.

Newsday, which has a tremendous reputation and is highly regarded, is not the subject of this posting; the ad-supported model vs. the subscription model is.

This story reminded me of how often we see a wave of this type of thinking in the online content world. Every few years, publishers start talking about how they're going to charge for access to their content, assuming that their traffic won't be tremendously affected, and that the combination of retained ad sales and new subscriber revenues will bolster their fortunes.

Well, then.

The Newsday example, if accurately reported in the New York Observer, once again proves that Web users are not interested in paying for most content. They know that they can find most any news or information for free on the Web. Why would someone pay for access to AP news on one site when they can get it for free on another?

I'm also reminded of my days in print publishing in which the publishers treated the ad sales business, and our clients, like second class citizens. I understand a lot of that had to do with lack of knowledge and weak experience, but it was definitely symbolic of the love/hate relationship between content providers and advertisers.

At some point, content providers need to make peace with the fact that it's okay to have advertising on their site. Some users are going to scream that they absolutely cannot read anything on a site because of that holy-awful 180x150 ad for--heaven forbid!--Taco Bell, and that they'll never, ever, ever visit the site ever again because of it. And they'll probably add an insult to the publisher's parents in their unsigned, anonymous email deploring the ads on the site.

But publishers have to keep in mind...these visitors aren't paying for the content, and if you ask them to pay in exchange for not showing ads, they're unlikely to take you up on the offer. If a user is that sensitive to advertising, maybe they need far more help in other, more profound ways, than by having a publisher switch their entire business model away from advertising supported content, to a paid subsciption model which has been proven time and again to not work.

I totally agree that there are some bad advertisements and some bad advertisers in the field, no doubt.

But on the whole, it's time to make peace with the ad-supported content model.

Let's be grand and call it "Pax Venditum" (Advertising Peace).

You read it here, first.