My Simple Minded World

PayPerPost and Making Money Online

Posted in The Interweb by Omar Ismail on September 23, 2007

TechCrunch has another post about PPP and its evils. I don’t want to talk about this specific incident since it’s pretty silly all around, but like Arrington says, PPP always brings up discussion and this is a good time to share my thoughts on it. While some people disagree with PPP’s methods, there IS something to be said about rethinking the way that bloggers make money. Look at the current situation… you have:

1. Bloggers who write and want to make money

2. Companies that want to get their products and services known

It’s only natural that these two forces come together. Bloggers want to make a living. Companies want to promote. Nothing groundbreaking here. Traditionally the way these two entities have come together is in the form of advertising. On the web this includes AdSense, or other ad networks, or using banner ads through an ad agency like¬†b5Media or Federated Media.

However, those kinds of advertising schemes are pretty broken. When you have technology such as AdBlocker existing, it shows that advertisements annoy a contingent of readers enough to take action, and maybe annoys more than that but are too lazy to do anything about it, or they bite the bullet and deal with the ads because they know the blogger has to eat.

But why does it have to be that way? It obviously doesn’t. For every blog out there, there is a corresponding business model that is a better fit than just throwing up some banner ads. Ads are very EASY to do, just go with an existed system, or even sell the ads yourself, it’s all very straight forward. But most of the time they’re not the BEST thing to do.

Look at ProductWiki, or any Price Comparison service. These are great business models because the money making is built directly into the service. People don’t consider the “ads” as being an out-of-context message, but an integrated part of the experience.¬† By using a model that is harmonious with your users expectations you end up making more money, and getting a better experience.

PayPerPost is another kind of way for bloggers to make money. The idea isn’t that bad in theory, it’s the execution that leaves you wanting. Personally, I looked at PPP to see if it’d make sense to have some bloggers write about the site and check it out. Looking at the blogs they recommended, most of them were crap. Garbage. Useless.

And it makes sense! A lot of bloggers that work with PPP make some decent money with it, so they use the service: a lot. The end result though is that most of these blogs have horrible quality where it’s just one payed post after another. That doesn’t benefit anyone, unless you’re just interested in straight link development. But if you were, you could get much better return on your investment through other means.

That being said, I’m not against having companies pay bloggers for their attention to review and examine their products and services. Bloggers don’t have infinite time to review everything. Looking at the web industry, you have your A-list, B-list and so on. These are busy guys that don’t have time to write about the 10 new startups that launch every single freaking day. What does that mean for the startups? You gotta pay to get noticed.

It’s already happening even if it isn’t explicit! Startups get funded, they hire PR firms, marketing agencies. They hold parties. They attend conferences. They spend A LOT of money to get themselves noticed by the people that matter. They spend A LOT of money in the hopes that they will be written about, and refered to by the people that matter.

You could say that bloggers just write about things they think are WORTH writing about. Well obviously. However, there’s a lot that they’re NOT writing about that is WORTH writing about but they don’t have TIME to. That’s where the paid model comes in. Let’s take out the middle-man. Using this medium why go the “old media” route of the payola to get bloggers to write about us. Just pay them directly. But you’re not paying for their writing. You’re paying for their attention so that they MAY write about you.

Naturally this creates a supply (blogger attention) and a demand (companies) and the result should and will be a bidding system to see which companies get covered first.

Let me take the side of a blogger for a second. I’m a busy person. I’m doing a lot of things with the site, I’m enjoying life outside of the Internet (try to), doesn’t leave much time to blog. However, if somebody comes to me and says “Yo, here’s $XXX so you can take time out of your busy schedule to check us out” I’d be down with that. And if I’m really busy they’d be like “Yo, we know you’re REALLY busy, so we’ll give you $XXX*2 for your time!” I’d be down with that too.

If these companies approaching me have a strong overlap with my audience, then it makes sense for EVERYONE.

Since it makes so much sense, then why are we left with such crappy options such as ineffective advertising or garbage PayPerPost? There’s a big opportunity here for someone to make a lot of money. But it’s definitely a balancing act because you can very quickly get into PPP territory of crappiness.

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