Knowledge Archives
http://www.co-internet.net/net/articles/adabyss.txt.html

Online Advertising Sinks Into the Abyss!
------------------------------------------------------
by
Lee Traupel
------------------------------------------------------

Back in the ancient days of 1994 when Mark Andreesen
and his band of hardy programmers were inventing a
ground-breaking product/application/way of life called
a browser, a dedicated group of entrepreneurs started
publishing Netsurfer Digest a modern day "Hitchhikers
Guide to the Galaxy" for the web. I subscribed to this
wonderful newsletter and reference guide back in those
heady days of yesteryear and have been a loyal
subscriber and advocate since then. Sadly on this past
Sunday I received notice that Netsurfer was moving to a
paid subscription only model and would no longer be
able to continue publishing their three primary
newsletters by utilizing inserted ads as their sole
source of revenue.

Netsurfer became the proverbial canary in the coalmine
that succumbed to the hazardous winds blowing across
the online advertising market. They simply couldn't
build a sustainable business model via ad inserts, even
by delivering a million impressions a month to an
upscale, well educated, target rich demographic group.
This denouement has broad implications to many who are
dependent on advertising supported business models. If
this wonderful award winning publication with excellent
graphics, topical information delivered in snappy
"let's get to the point" journalism can't make it then
it's time to batten down the hatches - the rough ride
is still underway for online advertising.

What's worse in my opinion is the founders of Netsurfer
Communications said they were throwing in the towel and
moving to a paid subscription model because they didn't
want to be a part of the intrusive (my words
paraphrasing a bit) online ad technology that has
become so "annoying." You have to give them
significant karma points for this brave stance,
especially when you contrast it to the "greed is great"
news that's been hitting us all via the Enron debacle -
thank God for real entrepreneurs who are putting their
ethics ahead of their revenue stream, there may be some
hope in the business community after all.

So, what does this mean to the broader community? It
means it's getting increasingly difficult to make a
buck/euro selling advertising without selling your soul
to the devil by deploying increasing invasive (does
anyone really like pop ups?) technology that may
irritate the hell out of your customers. Ad rates are
plummeting, even the once mighty Yahoo is struggling to
make revenue and their sales reps even return calls
now, which is definitely au contraire to their I'm too
busy to talk with customers .com glory days.

You couldn't read a Fast Company or a Business 2.0 the
last two years without reading some slick article by
another reporter breathlessly telling us how the Wall
Street Journal (Dow Jones) was pioneering the concept
of building a viable online content subscription
revenue model. This is hogwash, if we all had the type
of branded content, excellent editors and the sterling
reputation of one of the top five newspapers published
in the world then this model would work for thousands
of unique content publishers. But, most do not even
have the subscriber base and branded content of a
Netsurfer Digest - stay tuned to see if this model
works for the Netsurfer folks (I hope so); but don't
hold your breath, I don't think they will be ordering
their $1,500. Herman Miller chairs right and left like
the folks at Webvan and Quokka Sports - VC bucks don't
come around like they used to, but that's another
article.

I don't have any silver bullets for those who are
headed down the track of trying to sell advertising
supported newsletters and/or shift to a subscription
model. The obvious advice is this may work, but you
better have other revenue sources that leverage your
demographics. And, if you don't have mutually
reinforcing revenue streams, then take a hard look at
your business and modify accordingly. The greatest
shift in online advertising is via opt-in e-mail
marketing - we all want to receive information that is
timely, informative and presented in a compelling
manner. So, find a business model that lets you
narrowcast products and services to a community of
people who want to receive content (contact) from your
company - good luck to all and by the way, signup for
Netsurfer's paid subscription newsletter - I did, we
all have to vote with our visa cards once in a while to
keep the karmic balance on an even plane.



This text may freely be republished or distributed in unmodified form provided the following resource box is included intact either at the beginning or the end of the article and a complimentary copy or notice (link) is sent to the author at the address specified below:

Ralph Tegtmeier is the co-founder and principal of fantomaster.com GmbH (Belgium), < http://fantomaster.com/ >, a company specializing in webmasters software development, industrial-strength cloaking and search engine positioning services.

He has been a web marketer since 1994 and is editor-in-chief of fantomNews, a free newsletter focusing on search engine optimization, available at: < http://fantomaster.com/fantomnews-sub.html > You can contact him at mailto:fneditor@fantomaster.com
(c) copyright 2002 by fantomaster.com
All rights reserved.
Downloaded at: < http://fantomaster.com/ >