From November 17, 2005...

Note that this little ditty was written during that short period of time when Pajamas Media was (illegally) calling itself "Open Source Media" ("OSM"):

Site traffic.

The two magic words that lead to the pot of gold.

The thought in everyone’s mind is If only I can get enough traffic I can make money. If I have the traffic the advertisers will pay for access to it.

Everyone assumes site traffic is the key to blogger riches.

And, everyone is wrong. It is that simple.

Back when Roger L. Simon and I were bonded by true friendship and the common vision of large piles of cash in our laps, we decided to place a survey at his site to see what we could find out about the demographics of his readers. If memory serves, this would have been back in September, 2004. And what we discovered seemed to suggest we were sitting on a goldmine: Large household incomes, very well educated, disposable income out the blowhole... what we assumed advertisers wanted.

Well, by January of 2005 Roger and Charles had disappeared in a cloud of pure bullshit, and there I was, left waiting to hear about the “new model”, the “new partners” and “the new” what not... Being the curious sort, I arranged for a friend of mine to introduce me to the managing partner of a small, but prestigious, advertising firm in Columbus. I packed up our survey statistics and headed to a luncheon engagement that I assumed was going to convince this guy I was on to something.

Well, I spent 20 minutes explaining our idea and the business model as I envisioned it, and then, as the capper, whipped out the survey statistics and showed them to him. He looked at them for a moment, laughed, and then threw them down on the table in front of me.

“Worthless,” he said, smiling.

“Excuse me?” I said.

I then started explaining how great this information was, and continued to do so until he waved me off.

“Households don’t buy products,” he said.

“What?”

“Households don’t buy products,” he repeated. “Decision makers buy products. Decision makers within the household buy the products. You have no data on what products the households actually buy, and no data on who the decision maker is for each product.”

I followed that with yet another in a series of “What?” It wasn’t the last of them, either.

The reason the political blogosphere will never make money for bloggers via the selling of mainstream product advertising is because the reader demographics for political blogs will never support it. The political blogosphere is the internet equivalent of the Sunday morning news programs. Next time you are watching Russert or whoever, make note of who is advertising what on those programs. And keep in mind those shows are running on Sunday morning... and not primetime.

To put it a different way, who advertises during NFL games? Brewers of beer and builders of trucks. Why? Because the demographics of the viewership tells advertisers they have the household decision makers for beer and trucks. And here’s the important part: The demographics also tells them what they cannot sell. Market research tells advertisers that the people who NFL football games are not the decision makers on buying the kids back-to-school clothing or new bedding for the guest room. That’s why you don’t see K-Mart plastering the TV with ads during the Steelers game. Why do advertisers show toy ads on Nickelodeon? Because the kids are the decision makers in the toy equation. Mom and Dad may buy it, but only after they ask “What do you want for Christmas?”. That’s why toy ads are on Nick and not the Steelers game.

The mistake I had made was assuming that some good household data was enough information to get an advertiser to act. It isn’t. What will convince advertisers to advertise on blogs is convincing data that the decision makers for their products are at those blogs. Yeah, high household income is something advertisers like, but if it isn’t coupled with access to the decision maker they have no reason to spend with you. Their job is to convince the decision maker to buy their product. If you don’t deliver that person, they can’t do their job. If they can’t do their job, they are going move on from you to someone who will enable them do their job.

So think about this: What kind of advertising do you see on the Sunday morning talk shows? What kind of advertising do you see in the politically-oriented magazines (as opposed to news magazines)? See much in the way of advertising for computers, cell phones, video games or cameras? If not, what makes you think your shit-hot political blog is going to be able to land advertising for computers, cell phones, video games or cameras? I mean, beyond pure ignorance on your part?

The bottom line is this: There will be advertising sold on blogs, and soon. It will be sold by bloggers who run special interest blogs: photography blogs, cooking blogs, quilting blogs and the whatever else will bring in a demographic of desirable purchasing decision makers blogs.

You’ll have a better chance getting Canon to buy space on a photography blog that gets 400 unique visitors a day than on a political blog that gets 40,000 uniques daily. It doesn’t matter that a percentage of the 40,000 have and use cameras, or that they consider photography "a hobby"; for all the advertiser knows, those people pull out a $100 2 megapixel cheapie once a year to take a picture of Aunt Myrtle at the family reunion. But those 400 people going to a photography blog are there for one reason... photography. They can be surveyed and tested and proved to be serious in a way the 40,000 can’t... the blogger can demonstrate his demographic is the sort of people that buy $1,500 cameras every 6 months and every gizmo and gadget that they can get their hands on. You show Canon you have those 400 people and they’ll be writing you a check before you can suggest an amount you think is fair.

And this is something Roger, Charles, John and Aubrey are going to learn over the next few months. Arianna Huffington has probably learned it; Huffington Post has been up and running for months and has nothing but Google Ads. Look at Josh Marshall’s TPM Café, which I consider to be what OSM™ should have been. Marshall has done everything right – I mean, awesomely right – so right, in fact, to be to the point of perfection... and he’s asking for donations. Why? The demographics for purchasing decision makers isn’t there. And no matter how good TPM Café is, the fact that it will never draw beyond the political junkie demographic is the critical limiting factor. Period.

If you’re serious about blogging for money, you’d better stop wondering how you’re going to get that next Instalink and start wondering what you can enjoy blogging about that will bring you the product decision makers you can sell to an advertiser.

Always remember this: Your traffic ain't, in and of itself, worth a shit.

If you’re serious about blogging for money, then you are in a business. So start thinking like a business owner and an entrepreneur. If you’re thinking you are going to build the Next Great Thing in political blogging, and it’s going to make you a fortune, what you are doing is building a 21st Century version of the Edsel to sell on the internet. And why would you do that, given that OSM™ has $3.5 million to build their Edsel?

Note that this little ditty was written during that short period of time when Pajamas Media was (illegally) calling itself "Open Source Media" ("OSM"):

Site traffic.

The two magic words that lead to the pot of gold.

The thought in everyone’s mind is If only I can get enough traffic I can make money. If I have the traffic the advertisers will pay for access to it.

Everyone assumes site traffic is the key to blogger riches.

And, everyone is wrong. It is that simple.

Back when Roger L. Simon and I were bonded by true friendship and the common vision of large piles of cash in our laps, we decided to place a survey at his site to see what we could find out about the demographics of his readers. If memory serves, this would have been back in September, 2004. And what we discovered seemed to suggest we were sitting on a goldmine: Large household incomes, very well educated, disposable income out the blowhole... what we assumed advertisers wanted.

Well, by January of 2005 Roger and Charles had disappeared in a cloud of pure bullshit, and there I was, left waiting to hear about the “new model”, the “new partners” and “the new” what not... Being the curious sort, I arranged for a friend of mine to introduce me to the managing partner of a small, but prestigious, advertising firm in Columbus. I packed up our survey statistics and headed to a luncheon engagement that I assumed was going to convince this guy I was on to something.

Well, I spent 20 minutes explaining our idea and the business model as I envisioned it, and then, as the capper, whipped out the survey statistics and showed them to him. He looked at them for a moment, laughed, and then threw them down on the table in front of me.

“Worthless,” he said, smiling.

“Excuse me?” I said.

I then started explaining how great this information was, and continued to do so until he waved me off.

“Households don’t buy products,” he said.

“What?”

“Households don’t buy products,” he repeated. “Decision makers buy products. Decision makers within the household buy the products. You have no data on what products the households actually buy, and no data on who the decision maker is for each product.”

I followed that with yet another in a series of “What?” It wasn’t the last of them, either.

The reason the political blogosphere will never make money for bloggers via the selling of mainstream product advertising is because the reader demographics for political blogs will never support it. The political blogosphere is the internet equivalent of the Sunday morning news programs. Next time you are watching Russert or whoever, make note of who is advertising what on those programs. And keep in mind those shows are running on Sunday morning... and not primetime.

To put it a different way, who advertises during NFL games? Brewers of beer and builders of trucks. Why? Because the demographics of the viewership tells advertisers they have the household decision makers for beer and trucks. And here’s the important part: The demographics also tells them what they cannot sell. Market research tells advertisers that the people who NFL football games are not the decision makers on buying the kids back-to-school clothing or new bedding for the guest room. That’s why you don’t see K-Mart plastering the TV with ads during the Steelers game. Why do advertisers show toy ads on Nickelodeon? Because the kids are the decision makers in the toy equation. Mom and Dad may buy it, but only after they ask “What do you want for Christmas?”. That’s why toy ads are on Nick and not the Steelers game.

The mistake I had made was assuming that some good household data was enough information to get an advertiser to act. It isn’t. What will convince advertisers to advertise on blogs is convincing data that the decision makers for their products are at those blogs. Yeah, high household income is something advertisers like, but if it isn’t coupled with access to the decision maker they have no reason to spend with you. Their job is to convince the decision maker to buy their product. If you don’t deliver that person, they can’t do their job. If they can’t do their job, they are going move on from you to someone who will enable them do their job.

So think about this: What kind of advertising do you see on the Sunday morning talk shows? What kind of advertising do you see in the politically-oriented magazines (as opposed to news magazines)? See much in the way of advertising for computers, cell phones, video games or cameras? If not, what makes you think your shit-hot political blog is going to be able to land advertising for computers, cell phones, video games or cameras? I mean, beyond pure ignorance on your part?

The bottom line is this: There will be advertising sold on blogs, and soon. It will be sold by bloggers who run special interest blogs: photography blogs, cooking blogs, quilting blogs and the whatever else will bring in a demographic of desirable purchasing decision makers blogs.

You’ll have a better chance getting Canon to buy space on a photography blog that gets 400 unique visitors a day than on a political blog that gets 40,000 uniques daily. It doesn’t matter that a percentage of the 40,000 have and use cameras, or that they consider photography "a hobby"; for all the advertiser knows, those people pull out a $100 2 megapixel cheapie once a year to take a picture of Aunt Myrtle at the family reunion. But those 400 people going to a photography blog are there for one reason... photography. They can be surveyed and tested and proved to be serious in a way the 40,000 can’t... the blogger can demonstrate his demographic is the sort of people that buy $1,500 cameras every 6 months and every gizmo and gadget that they can get their hands on. You show Canon you have those 400 people and they’ll be writing you a check before you can suggest an amount you think is fair.

And this is something Roger, Charles, John and Aubrey are going to learn over the next few months. Arianna Huffington has probably learned it; Huffington Post has been up and running for months and has nothing but Google Ads. Look at Josh Marshall’s TPM Café, which I consider to be what OSM™ should have been. Marshall has done everything right – I mean, awesomely right – so right, in fact, to be to the point of perfection... and he’s asking for donations. Why? The demographics for purchasing decision makers isn’t there. And no matter how good TPM Café is, the fact that it will never draw beyond the political junkie demographic is the critical limiting factor. Period.

If you’re serious about blogging for money, you’d better stop wondering how you’re going to get that next Instalink and start wondering what you can enjoy blogging about that will bring you the product decision makers you can sell to an advertiser.

Always remember this: Your traffic ain't, in and of itself, worth a shit.

If you’re serious about blogging for money, then you are in a business. So start thinking like a business owner and an entrepreneur. If you’re thinking you are going to build the Next Great Thing in political blogging, and it’s going to make you a fortune, what you are doing is building a 21st Century version of the Edsel to sell on the internet. And why would you do that, given that OSM™ has $3.5 million to build their Edsel?

Comments

[jcw]

You've pretty much nailed it here, DTP. I've been reading and visiting blogs on a daily basis for 6 years. I have never once clicked on an ad or even paid attention to the ads. For most purchases in our household (food, clothing etc) I am not the decision maker on these items, the wife and kids are. And guess what. They don't read blogs,ever. I know, this is just anecdotal evidence. My profile, though, is probably very common.

[Phoenix Woman]

Yup, yup and yup. Know those little pop-up "take a survey" ads you run into on the net a lot? Among the first questions they ask are "Are you the primary user of this computer?" and "Are you the primary decision maker when it comes to purchasing X?"

[markg8]

Not to mention people are known to lie on self selected surveys all the time, mainly claiming they make more money than they do.

Forgot about your camera example Dennis but it brought back memories of some war blogger/reporter I read back in 2006 rating cameras he took to Iraq. If I recall correctly the Nikon D90 was his top choice. In retrospect it looks like he took your advice literally. I wonder if Nikon bought any ads on his site.

Marshall must be doing something right these days. He still has ads for political books, think tanks, etc. but the ad I've noticed splashed all over the site lately in top and side banners is for a $10 dollar teeth whitener discovered by a "mom".

[2Hotel9]

Dennis? May I link this to a thread on the subject of PJ's "untimely" demise over at sayanything? Aside from snatching the thread back to subject, and away from one of our resident leftad trolls, it will bring a few not stupids to bask in the Peasant Experience.(and yes, I spelled expeirence right the first time)

[Dennis The Peasant]

2Hotel9-

Knock yourself out.

[2Hotel9]

Thanks! Oh Peasantly One!

[Tim P]

"Households don’t buy products, he repeated. Decision makers buy products. Decision makers within the household buy the products.

As the decision maker in this here household, I...
What? Yes dear. Uhm, I have to go now.

[ema]

This is exactly why there was never any doubt that your predictions about Pajamas Media were spot-on. You always had the, you know, facts and data to support your arguments.

And let's not forget the added value of your posts, at least for readers like me (a medblogger) -- your ability to discuss business/financial matters in an accessible manner. [Hmm, maybe I should offer to teach you how to suture an episiotomy as a thank you.]

[Simon]

Gee Dennis, your comments section has lit up like a poker machine on pay day.

With all the praise and attention you're getting perhaps you should start up as a PJM special interest blogger.

[Dennis The Peasant]

Simon-

Nah, news cycles and memories are short...

[markg8]

Well that and within a year there probably won't be a PJM to blog about.

[Dennis The Peasant]

ema-

I appreciate the offer, but...

[ema]

Fair enough, some bonbons then.