Frager Factor

Saturday, March 30, 2013

PPC Rates Sink: 'Why Jump on a Failing Model?'


As Ad Rates Sink, More Websites Explore Ad-Free Business

'Why Jump on a Failing Model?' Andrew Sullivan Asks

The founders of the website The Good Men Project predicted early on that their lean operation would turn a profit from ad sales once it started attracting about a million unique visitors per month. And as traffic neared that mark late last year, the company indeed turned in its first profitable quarter. So why did it just start offering an ad-free version?
The Dish has no ads. Other sites are exploring similar approaches.
The Dish has no ads. Other sites are exploring similar approaches.
"It became clear that banner ads are annoying to people and they just aren't that profitable," said Lisa Hickey, CEO of Good Men Media. "The CPMs slowly go down," she said, using industry shorthand for the price advertisers pay for every thousand views on a site. "The number of ads we have to put on the site to break even goes up. It's a balancing act that doesn't get us to where we need to go."
This is web publishing in 2013, when declining ad rates and the sense that each buck is harder to get than the last is leading increasing numbers of publishers to strip out the ads and ask readers to pony up. Even The New York Times has at least contemplated the idea of an ad-free version, asking readers about it in a recent survey about potential new products. Its sibling The Boston Globe already operates two websites, the free, which is packed with all kinds of traditional ads, and the subscriber-only, with far fewer, and much less intrusive, ads.
But ad-free experiments are taking root faster among smaller publishers and blogs, for whom the economics of digital advertising can be particularly punishing. You wouldn't call it a sea change, but there is a lot of splashing in the waves.

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