Sponsors want to know what the value is. They want to know what the audience looks like and how engagement on your service translates into usability. While these kinds of activities are things that businesses should be doing anyway, chasing sponsorship dollars will force companies into more rigorous thinking on how value is created for the consumer.
This is not pie-in-the-sky thinking. In fact, there are reasonably mature valuation models that help sponsors calculate the value of potential sponsorship vehicles.
What are naming rights worth? What is it worth to have one's name in every activation email? What is it worth to have one's name associated with a particular feature? All of these questions have answers, plus lots of examples of what seemingly innocuous variables cause value to spike up or down.
Some of your categories were interesting choices. It would be interesting since that was written like you said two years ago if you were to update that listing and see if it has changed and how.
Brian Hayashi
· 1 year ago
I think there is a lot of confusion around sponsorship. It is not the same as selling ad placements. It is also not about selling out one's integrity.
I love Web 2.0 because it forces people to stop thinking of web sites as a collection of pages that people visit. It has inspired people to think of the web as an experience; and by following that train of thought we see how people don't simply search, they want to discover. It forces marketers and developers alike to think about what people want to do and how their company can earn a spot at the table by helping people accomplish their goals.
An ad placement is but a single moment in time. Sophisticated sponsors include individual ad placements in their analysis but only as part of the big picture. Likewise, potential sponsors will stay away from places where there is conflict of interest: sponsors don't want to be associated in any way with unethical activities like payola or flogging. In fact, sponsorship beat Web 2.0 to the punch when we talk about conversational marketing. I'm just excited that there is more interest now than there was two years ago.
Postscript: If you're interested in sponsorship, you should check out my post on custom publishing as an emerging sponsorship trend: http://tinyurl.com/4ng4nm
James
· 1 year ago
I think there's a middle ground to becoming ad experts and having to throw that model out completely. It may depend on content of course, but if you represent a very strong niche you can often garner the right attention and hit ad deals very close to your audience.
If you can land a sponsorship - you can do the alternative. And while a sponsorship can be very lucrative, I'm not sure it outweighs putting a decent amount of effort into working with direct traditional ad buys on your site AND filling remnant space with those ad networks.
Steven Hodson
· 1 year ago
REgardless of whether you have a strong niche or not it is a matter of getting that attention which typically will come via an ad network who typically will make the lion share of the money.
Sponsorships aren't limited to strictly one company. There is no reason that a blog or a start-up couldn't have multiple sponsors that were in line with what the blog owner - or start-up owner - wanted associated with their brand.
Plus not all bloggers are looking for immense riches - many are more then willing to have the bills paid and be able to have a few toys. Others may want to replace a 9 to 5 job which consistant sponsorships could fulfil.
Shannon Clark
· 1 year ago
There are some other alternatives which are, I hope, emerging.
Specifically, I'm the founder of an ad network, Nearness Function, which is entirely focused on brand advertising and sponsorships. We work closely with select publishers and advertisers (agencies and direct advertisers) to craft brand campaigns and sponsorships that work for all parties - especially the communities of the publishers.
So I'm not exactly unbiased here, but I do think there will be companies, such as Nearness Function, that could be a good option for some startups and other publishers to work with as an alternative to selling sponsorships/brand campaigns directly.
That said, we are not, at least initially, working with bloggers. Our first two publishers are a network of 1000+ Internet radio stations and set of very large communities around consumer electronics. We chose these publishers because they have persistent, returning and active audiences, something not all blogs have.
Shannon
Steven Hodson
· 1 year ago
So you are suggestiong that bloggers are not of interest to ad networks then like yourself and that we are best left to the mercy of things like AdSense.
Shannon Clark
· 1 year ago
No, not at all. Just noting that my particular company isn't focusing on bloggers initially, we may eventually (and then be in direct competition with companies like Federated Media). We are very focused on brand advertising, in particular via sponsorships, so we will definitely look at the best communities we can work with over time - some of which may indeed be bloggers (but most likely will either be networks of bloggers or startups).
A challenge that many, though not all, blogs face is that 50% (or more in some cases) of their traffic arrives via search engines, often reads that single post and then leaves. Where brand advertising or sponsorships work best is when there is an ongoing, returning, and engaged community which those brands are thus sponsoring & supporting - and since the community returns over time they learn about that sponsor over time and appreciate the sponsor's support of the community.
Now blogs which have a passionate and highly active and engaged readership could be an exception to this (many political blogs for example) but it also takes creativity on the part of both the blogger/startup founder and the sponsors (and any related parties such as ad agencies and/or networks such as mine) to extend the sponsors' reach creatively without compromises, annoying the community, or being deceptive in any way. In the best cases this means embedding a light recognition of the sponsor's support into feeds, content that gets embedded etc but only very lightly.
Todd
· 1 year ago
What about Adroll?
Like Federated Media, it can give advertisers a clear audience to target because bloogers form networks based on content.
Unlike Federated Media, the content is not hand picked, anyone with a blog can join. Since, to my understanding, the prices for ads are auction based, this also means advertisers are paying for ad space based on demand.
I don't work for Adroll, or anything, but it seems to solve a lot of these problems for small to medium audience blogs.
Eric Hamilton
· 1 year ago
I think you'll find that the sponsorship model works best for bloggers who are themselves a brand worthy of partnering with. The Gawkers, Kosh's, and Godins of the world will be able to attract sponsors much more easily than smaller blogs.
What bloggers need to show sponsors is that they have a valuable brand, too. Not simply hits to their website, but FANS and ADVOCATES.
In addition to raw traffic stats, sponsors are going to want detailed demographics (which most bloggers don't collect), they'll want to know where and how on the internet the blog is being talked about, how many backlinks the blog attracts, and where they're coming from, and so on.
On other words, if you want to attract sponsors, you need to be working on your own brand awareness.
Steven Hodson
· 1 year ago
Some excellent suggestions Eric - thanks for adding them to the conversation. These are definitely some points that I will be adding to my personal list of things to look at during the road forward.
Daniel Tunkelang
· 1 year ago
I hate the ubiquity of the ad-based model as much as the next person. But I'm skeptical about sponsorship as a replacement. At least with ad-based sites, I have no reason to believe that the writer is skewing the content to favor the advertisers--mainly because the writer doesn't even know who the advertisers are. In contrast, a writer with a sponsor may be beholden to that sponsor. Even if he or she isn't, that possibility will taint my appreciation of the site.
To be clear, my own blog, The Noisy Channel, could be seen as sponsored by my employer, Endeca, since they pay me to do my day job. And indeed, I feel a high burden both to fully disclose my relationship and show that I'm not shilling for my company.
Steven Hodson
· 1 year ago
So if you feel a high burden for disclosure why wouldn't I (or any other blogger) not have that same feeling if they were being sponsored by say ... AMD .. Linksys ... etc etc.
By trying to equate the idea of sponsorship with oh .. PayPerPost you are doing bloggers a disservice. There is no reason why we wouldn't be able to maintain the wall of seperation between content and sponsorship. Sure that wall has to be understood by both parties from day one of any agreements. If the company doing the sponsorship does something wrong or ships a bad product the person they should be hearing it from first is the blogger that they are sponsoring. If they can't live with that agreement then they aren't worth having as a sponsor.
Daniel Tunkelang
· 1 year ago
Yes, I'd hope you would have that same feeling. I don't know you well enough to question your integrity. :) I do know that other bloggers get flames for conflict of interest (real or perceived) all the time.
I'm just pointing out that sponsorship has a major drawback as a model: it leads at least some of your audience to suspect a conflict of interest that doesn't come up when there is no relationship between the blogger and the advertisers. I hope you agree on that point.
I agree with Srini that the current approach overpays Google as a middleman. In general, advertising serves as a middleman, where the ideal model is consumers paying for content. I count rant about this for hours.
But my point is practical: I wonder how many users would shy away from reading a sponsored blog. Try googling "sponsored blogs" and it's clear from the results that the subject is controversial.
Ling
· 1 year ago
Sponsorship for small to medium blogs would mean finding sponsors who want to build a brand, as opposed to calculating hits and clicks. Precious few sponsors like that around...
Shannon Clark
· 1 year ago
Link,
All companies - big or small - want to (or at least should want to) build their brands. Historically most did this via what they supported - both via ad purchases and other forms of support (sponsorship of events, sports teams, shows, etc).
There are no shortage of brands out there - if anything in today's highly global and competitive world there are more brands competing on a more even playing field in more areas of business than ever before. Consumers in the US have, if anything, a surplus of options for any category or niche where they might want to spend money.
My personal view is that the one-to-one sponsorships, such as Scoble's with Seagate while lucrative are, somewhat, limited. But that multiple sponsors for a given property is a more sustainable model for both the publishers AND the brands.
Srini Kumar
· 1 year ago
Google's a giant middleman.
Let the advertisers pay the publishers directly. Sounds good to me !!! Especially if the publishers have an audience that listens to them or really uses the heck out of their service in a CONTEXT-RICH AND SEGMENT-TARGETED way (like our friends at dogster for instance)
Google AdSense is neat because of the context targeting at all, but you can do that yourself (or let the users do it like Ning).
The macroeconomic picture is that United States residents have certain advantages in creating and profiting from intellectual property as is generated from places like the blogosphere. Our country is perhaps headed for a weak dollar, so foreigners will suddenly find their pockets bulging with undeserved money. Providing information products is a no-brainer, and American exporters should definitely sponsor these publishers - who should be working hard on translating their pages into other languages.
Luckily, the METANOTES interface will be a snap to internationalize - it like has fifty words, all the rest is UGC. And hey sponsors - Japanese internet users would love to learn about your company as they take to our platform, they really would :)
- Srini Kumar CEO METANOTES.COM
Megan Boris
· 1 year ago
Would it be more or less effective to try and target your advertisements to what you hope your target audience will be? This idea works in traditional marketing, but with the wide variety of the internet audience, I wonder how difficult it is to truly target your intended audience.
Eric Hamilton
· 1 year ago
It is effective to have a target audience in mind for your blog, and serve that target audience to the best of your ability with your content.
Then find sponsors with similar audience targets.
Facey Spacey Development
· 1 year ago
Steven, so when are you building marketplace social network for sites to arrange simple sponsorship deals with other companies?
I'd love to develop that for you. I actually have a somewhat similar idea that I invented. It's a tool to buy CPM-based advertising in-site! So just like recording a video via the Viddler plugin in this comment, you can just go to a site and click a button and buy advertising right here rather than going to Federated Media. Check out the Powerpoint I made: http://www.faceyspacey.com/downloads/Ad-BadgerG...
Thanks for the post. We are following the sponsorship route for our videos and so far have secured a sponsor from Noflights.com.an environment travel agency for our http://www.Bike2Oz.com series distributed by RSS.
It suits us a lot more as we are free to make our films rather than chasing up new advertisers all the time. Cheers Paulo
Subhanjan Sarkar
· 1 year ago
There is a lot that is being discussed. A lot is what has already been happening in the old media world. Readers of Time do not necessarily question a Audi/Mercedes pullout/supplement. Readers and now users of the web understand and are descering enough to take what they need and leave the fluff/promotion at the door.
More importantly all this discussion seems to be about NEW customers. Sponsorship is great for existing customers who you need to keep and service. An existing user of NOKIA or iPHONE would not necessarily stay away or judge ( the way it is being suggested ) inputs about NOKIA products. This is a big problem anyway. Most customers seem to believe that companies woo them a lot before a purchase decision is made but promptly forgets them once they get their $'s. Companies are waking up to that fact ( despite knowing the cost benefit between retaining and getting a new customer since long).
All Comments
Sponsors want to know what the value is. They want to know what the audience looks like and how engagement on your service translates into usability. While these kinds of activities are things that businesses should be doing anyway, chasing sponsorship dollars will force companies into more rigorous thinking on how value is created for the consumer.
This is not pie-in-the-sky thinking. In fact, there are reasonably mature valuation models that help sponsors calculate the value of potential sponsorship vehicles.
What are naming rights worth? What is it worth to have one's name in every activation email? What is it worth to have one's name associated with a particular feature? All of these questions have answers, plus lots of examples of what seemingly innocuous variables cause value to spike up or down.
Two years ago, I blogged about emerging sponsorship categories. You can judge my prescience accordingly :)
http://connectme.typepad.com/news/2006/03/iegs_...
I love Web 2.0 because it forces people to stop thinking of web sites as a collection of pages that people visit. It has inspired people to think of the web as an experience; and by following that train of thought we see how people don't simply search, they want to discover. It forces marketers and developers alike to think about what people want to do and how their company can earn a spot at the table by helping people accomplish their goals.
An ad placement is but a single moment in time. Sophisticated sponsors include individual ad placements in their analysis but only as part of the big picture. Likewise, potential sponsors will stay away from places where there is conflict of interest: sponsors don't want to be associated in any way with unethical activities like payola or flogging. In fact, sponsorship beat Web 2.0 to the punch when we talk about conversational marketing. I'm just excited that there is more interest now than there was two years ago.
Postscript: If you're interested in sponsorship, you should check out my post on custom publishing as an emerging sponsorship trend:
http://tinyurl.com/4ng4nm
If you can land a sponsorship - you can do the alternative. And while a sponsorship can be very lucrative, I'm not sure it outweighs putting a decent amount of effort into working with direct traditional ad buys on your site AND filling remnant space with those ad networks.
Sponsorships aren't limited to strictly one company. There is no reason that a blog or a start-up couldn't have multiple sponsors that were in line with what the blog owner - or start-up owner - wanted associated with their brand.
Plus not all bloggers are looking for immense riches - many are more then willing to have the bills paid and be able to have a few toys. Others may want to replace a 9 to 5 job which consistant sponsorships could fulfil.
Specifically, I'm the founder of an ad network, Nearness Function, which is entirely focused on brand advertising and sponsorships. We work closely with select publishers and advertisers (agencies and direct advertisers) to craft brand campaigns and sponsorships that work for all parties - especially the communities of the publishers.
So I'm not exactly unbiased here, but I do think there will be companies, such as Nearness Function, that could be a good option for some startups and other publishers to work with as an alternative to selling sponsorships/brand campaigns directly.
That said, we are not, at least initially, working with bloggers. Our first two publishers are a network of 1000+ Internet radio stations and set of very large communities around consumer electronics. We chose these publishers because they have persistent, returning and active audiences, something not all blogs have.
Shannon
A challenge that many, though not all, blogs face is that 50% (or more in some cases) of their traffic arrives via search engines, often reads that single post and then leaves. Where brand advertising or sponsorships work best is when there is an ongoing, returning, and engaged community which those brands are thus sponsoring & supporting - and since the community returns over time they learn about that sponsor over time and appreciate the sponsor's support of the community.
Now blogs which have a passionate and highly active and engaged readership could be an exception to this (many political blogs for example) but it also takes creativity on the part of both the blogger/startup founder and the sponsors (and any related parties such as ad agencies and/or networks such as mine) to extend the sponsors' reach creatively without compromises, annoying the community, or being deceptive in any way. In the best cases this means embedding a light recognition of the sponsor's support into feeds, content that gets embedded etc but only very lightly.
Like Federated Media, it can give advertisers a clear audience to target because bloogers form networks based on content.
Unlike Federated Media, the content is not hand picked, anyone with a blog can join. Since, to my understanding, the prices for ads are auction based, this also means advertisers are paying for ad space based on demand.
I don't work for Adroll, or anything, but it seems to solve a lot of these problems for small to medium audience blogs.
What bloggers need to show sponsors is that they have a valuable brand, too. Not simply hits to their website, but FANS and ADVOCATES.
In addition to raw traffic stats, sponsors are going to want detailed demographics (which most bloggers don't collect), they'll want to know where and how on the internet the blog is being talked about, how many backlinks the blog attracts, and where they're coming from, and so on.
On other words, if you want to attract sponsors, you need to be working on your own brand awareness.
To be clear, my own blog, The Noisy Channel, could be seen as sponsored by my employer, Endeca, since they pay me to do my day job. And indeed, I feel a high burden both to fully disclose my relationship and show that I'm not shilling for my company.
By trying to equate the idea of sponsorship with oh .. PayPerPost you are doing bloggers a disservice. There is no reason why we wouldn't be able to maintain the wall of seperation between content and sponsorship. Sure that wall has to be understood by both parties from day one of any agreements. If the company doing the sponsorship does something wrong or ships a bad product the person they should be hearing it from first is the blogger that they are sponsoring. If they can't live with that agreement then they aren't worth having as a sponsor.
I'm just pointing out that sponsorship has a major drawback as a model: it leads at least some of your audience to suspect a conflict of interest that doesn't come up when there is no relationship between the blogger and the advertisers. I hope you agree on that point.
I agree with Srini that the current approach overpays Google as a middleman. In general, advertising serves as a middleman, where the ideal model is consumers paying for content. I count rant about this for hours.
But my point is practical: I wonder how many users would shy away from reading a sponsored blog. Try googling "sponsored blogs" and it's clear from the results that the subject is controversial.
All companies - big or small - want to (or at least should want to) build their brands. Historically most did this via what they supported - both via ad purchases and other forms of support (sponsorship of events, sports teams, shows, etc).
There are no shortage of brands out there - if anything in today's highly global and competitive world there are more brands competing on a more even playing field in more areas of business than ever before. Consumers in the US have, if anything, a surplus of options for any category or niche where they might want to spend money.
My personal view is that the one-to-one sponsorships, such as Scoble's with Seagate while lucrative are, somewhat, limited. But that multiple sponsors for a given property is a more sustainable model for both the publishers AND the brands.
Let the advertisers pay the publishers directly. Sounds good to me !!! Especially if the publishers have an audience that listens to them or really uses the heck out of their service in a CONTEXT-RICH AND SEGMENT-TARGETED way (like our friends at dogster for instance)
Google AdSense is neat because of the context targeting at all, but you can do that yourself (or let the users do it like Ning).
The macroeconomic picture is that United States residents have certain advantages in creating and profiting from intellectual property as is generated from places like the blogosphere. Our country is perhaps headed for a weak dollar, so foreigners will suddenly find their pockets bulging with undeserved money. Providing information products is a no-brainer, and American exporters should definitely sponsor these publishers - who should be working hard on translating their pages into other languages.
Luckily, the METANOTES interface will be a snap to internationalize - it like has fifty words, all the rest is UGC. And hey sponsors - Japanese internet users would love to learn about your company as they take to our platform, they really would :)
- Srini Kumar
CEO
METANOTES.COM
Then find sponsors with similar audience targets.
I'd love to develop that for you. I actually have a somewhat similar idea that I invented. It's a tool to buy CPM-based advertising in-site! So just like recording a video via the Viddler plugin in this comment, you can just go to a site and click a button and buy advertising right here rather than going to Federated Media. Check out the Powerpoint I made: http://www.faceyspacey.com/downloads/Ad-BadgerG...
James
from
FaceySpacey.com - "The Startup Incubator"
We are also negotiating a sponsorship deal for our Bushcraft video series on http://www.azbushcraft.com
It suits us a lot more as we are free to make our films rather than chasing up new advertisers all the time.
Cheers
Paulo
More importantly all this discussion seems to be about NEW customers. Sponsorship is great for existing customers who you need to keep and service. An existing user of NOKIA or iPHONE would not necessarily stay away or judge ( the way it is being suggested ) inputs about NOKIA products. This is a big problem anyway. Most customers seem to believe that companies woo them a lot before a purchase decision is made but promptly forgets them once they get their $'s. Companies are waking up to that fact ( despite knowing the cost benefit between retaining and getting a new customer since long).