Why Banner Advertising For Blogs Sucks [A Story]

24 | Posted In Make Money by David

So, I get an email from a guy. I’ll leave his company out of it.

In short, he wants to place a text link on PCMech.com for a monthly fee. He isn’t interested in banner advertising. Just the text link.

So, I reply and essentially tell him that I’m not willing to do a site-wide text link for the purposes of SEO. Now, his site is related to mine, so that wouldn’t have been a problem. It was more a point about visual clutter. I don’t wish to litter up my blog with random links just because I get paid for it.

I told him that I’d be willing to use a text link if the link is clearly labeled as a sponsored link. In other words, he doesn’t want a graphical banner. Just text. Works for me, as long as my visitors know why the link is there. I wanted it to look like an ad, even though it was text.

I have banner advertising rates on PCMech, but nothing established for text links. So, I simply tossed out an offer of $200/month, set up via Paypal subscriptions so it would be renewed each month.

Keep in mind, a link in the sidebar of PCMech, site-wide, would expose his link to over a quarter-million people per month. That’s a lot of people. $200 seems like an absolute steal to me.

His response?

That is way too much money. I advertise on other sites similar to yours with a text link on all pages for $50.00 a month. I paid in advance of 6 months to get the deal of $50.00 a month, but $200.00 is not worth it. Thank you.

Then he sends a second email:

Also, the price you are quoting me is like I am getting some banner on your site. It is a text link. Anyway, I guess I will just go with the others. Thank you for your time.

Wow. So, $200/month is more like what he’d expect for a graphical banner ad? And people with similar sites to mine taking $50/month for a link?

I walked. Not worth my time. And apparently his neither.

The Motto Of This Story

You know what happens when what you offer is offered by everybody else, too?

You turn into a commodity.

There is nothing unique, so price is the only thing to compete on.

Websites running advertising are a commodity. If you, as a blogger, are trying to make your money with ads, you are a commodity. It doesn’t matter how low you think your ad rates are, some other person is going to undercut your price.

From an advertiser’s perspective, all they want is incoming links from related sites. That is easy to come by and there are plenty of schlubs willing to do it. Even if they want banner ads for better exposure and branding, there are TONS and TONS of sites selling space.

In real estate, we would call this “a buyer’s market”. There is TONS of supply in the marketplace and that drives prices down. Only really exclusive areas (like waterfront) can still demand higher prices because of the limited supply. Well, it is the same in online advertising. Certain web properties can command higher rates simply due to their market positioning. And, I’m willing to bet that even THOSE sites are looked at as commodities much of the time.

Advertisers expect too much for next to nothing. And you, as a blogger, are in no position to build a sustainable business if you’re depending on that.

The motto? Build your own assets and products.

When you have your own product, your competition becomes MUCH less. You have a highly leveragable asset and you can almost set your own prices. You define the rules of the game.

I mean, seriously. I could make a few sales and bring in $200 pretty easily – any time I feel like it. So, it starts to put into perspective these stupid little advertising offers where a guy thinks $200 for exposure to a quarter-million people is too highly priced. Gimme a break.

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  • http://www.gospelrhys.co.uk/ Rhys

    Gah that person sounds like the bane of our (as in “Reasonable SEO'ers”) life. Alas they only look at the SEO value for things, rather than the bigger picture. Any decent site is worth $200 for a text link, same with banner ads. Unfortunately, shonky SEO'ers work on such tight margins that they probably price their SEO effort for $300-$400 month.

    Probably only looked at the pagerank too.

    Chances are that guy would probably offer any other blogger $50 month.

  • http://www.marsdorian.com/ Mars Dorian

    Hey Dave,

    interesting story. You may be right – those people just treat you (or your) blog like a product – if you are perceived as a product – there's always a cheaper one. I'd never put little scammy ads on my blog – it looks just nasty. I will follow your advice and manly concentrate on creating my own products/services – it's the method that will establish you as a highly recognized personal brand in the near future.

  • http://www.source-blogger.com Source Blogger

    Hi David,

    This is Source Blogger. Assuming you spend any time in the blogosphere, you and I know that even with the number of blogs in the market, there is still a great disparity in quality from one blog to the next.

    Blogs that are creative, that effectively communicate, and have a strong, growing fan base are in short supply!

    Thus, the saturated, commodity idea may not be all that true. And deep-down inside, advertisers know this.

    Your friend,

    Source Blogger
    “Determined to make you a better blogger!”

  • http://davidrisley.com David Risley

    Put yourself into the typical advertiser's shoes and you won't look at it that way. They want NUMBERS. They don't really care how unique your blog is and how good a writer you are.

    You've got advertisers who are after branding, and those that are after SEO. The SEO ones are bottom-barrel people, as far as I'm concerned. They'll low-ball the hell out of you because all they're goal is the Google spider, not real people.

    The guys after branding, they do care about quality. But, only to the extent that it sends them numbers. It is about ROI.

    And when you have a huge number of bloggers out there, all trying to make themselves unique and attractive to advertisers… guess what? Now they're a commodity.

    So, I know what you're saying. However, I think you've got a little too utopian view of the potential of

  • http://www.brandonburgh.com BrandonBurgh

    Hey David,
    I definately see where you are coming from. And completely looking at this whole thing 3rd party-wise, I think if the guy really wanted it badly enough…I would have asked for a phone number from you, called and talked it out some more.
    That is one of the bad things about email. You can't find out more, easily, about the people you are dealing with. My guess, if he would have called, struck up a conversation with you, etc, you may even have been willing to negotiate the $200. Maybe not, but I'll bet his odds were better if you had a chance to know and like him, if even for 30 seconds on the phone before getting down to business.
    Just some thoughts,
    Brandon

  • http://davidrisley.com David Risley

    Even $200 is super-low, as far as I'm concerned. Its just not an amount of money I want to invest much of my time in. Advertising isn't my main revenue source.

    Call it 80/20 rule, I guess. :-)

  • http://erica.biz ericabiz

    I got one the other day for someone asking for a sitewide text link on erica.biz (30K visitors per month) for $5/month. Are you kidding me? That wasn't even worth my time to reply back to.

    -Erica

  • http://website-in-a-weekend.net/ Dave Doolin

    People are funny that way, they think their money is worth more than your time.

    I turned down work yesterday from someone who informed it “should be easy, just move a few hooks around.” I thought to myself, “you bet, it's so easy you can do it yourself.” I begged off with “too busy.” No sense in starting a battle.

  • http://experimentsinpassiveincome.com Moon Hussain

    That sounds ridiculous. If the guy can't see what he's getting for $200, that's his loss. Waste of time!

  • altevogt

    Heil!

  • http://internetmarketingcoding.com/ Andrew

    Maybe this advertiser did not consider the cost per click. So if he gets 250,000 exposures of his Ad, and it is marked as sponsored, and shown a few times to the same people, the CTR might be say 0.5% of visitors for example.

    So that would be 1250 clicks at an average price of 16 cents a click which seems cheap to me.

    But I guess this guy thought it was expensive?

  • http://evengrounds.com/blog Julius

    It's really a good idea to have a service or product that is unique and stands out from the rest of the market. I think this can be done by spending a few minutes everyday looking at competitors and figuring out what they don't offer. We can stop this task when we have a concrete set of unique services.

  • http://www.financiallydigital.com Nunzio Bruno

    I am experiencing this right now!! I've been experimenting with ads and different programs and it's like at every junction unless you are willing to offer lower and lower amounts you just get skipped over. I have a few things in the works as far as original works/services are concerned and the goal of the blog was never to make it an posted ad platform but what an eye opening experience this has been. This post couldn't have come at a better time for me. Thanks for the story!!

  • http://www.superawesomedating.com IamDavid

    So the moral of the story is go with adsense and screw dealing with people…j/k :)

    Listened to your interview with not a pro blogger and you two brought up some of the core ideas in this article. Guys should listen to it, Dave may be a sandal wearing florida dude, but he is a real professional. Anyways, blogs, and more specifically expert based blogs seem to be the way to go in terms of building assets.

  • http://sometimesithink-krissy.blogspot.com krissy knox

    Thanks for the advice, David. You're right, we need to build our own assets and products. That way we are in control, and can choose not to accept ridiculous offers as the one that was presented to you. Apparently, this person who so devalued your traffic and readership (evidenced by the fact he didn't want to pay you a fair price for an ad) didn't take into consideration what it was like for you to take the time and resources to build your traffic and readership over the years. Or simply didn't care. Let him go build up his own traffic for his blog or site, and you go on selling your products! Kudos to you for saying no! :)

  • http://www.brandonconnell.com Brandon Connell

    The guy was dumb basically. He was insulted only because he could not afford you. That much exposure is worth much more than $200 a month and someone would step into his place after he left I'm sure.

  • http://www.melvinblog.com/ Melvin

    wow, is that guy serious? well in the internet theres really no shortage of that and Im probably already immune with it.

    But I think your point about commodity is true. when you start selling yourself cheap (by running ads instead of other things),people will really undercut you where as by having a product or services, its fixed

  • http://www.websitebegin.com Joe Boyle

    I would much rather see a text ad located inside of a well written article then a block of banner ads located to the right. Quite simply, the text ad looks more natural.

  • http://hotblogtips.com/ Keith Bloemendaal

    You hit it right Dave, I get offers all the time for text only links, but I refuse them for the same reason. The people are after SEO links only and could care less about the branding value. I would rather not expose that to my readers….

  • http://www.designerclothesonline.co.uk/clothing/ralph-lauren/polos/ Polo Ralph Lauren

    Seems to be very destructing seeing a lot of banner ads around your blog. The impact of it had disregard the intention of taking a glimpse on the post.

  • http://www.altkommein.com Altkommein

    Hi David, i've got few emails like this and they're asking me to set this up for 10-25 $ on some of my site. I think banner ads are much better cause we don't get into risk of link selling to irrelevant sites.Besides be it text link or banner you're passing traffic to those sites, so why they're not ready to pay some bucks for that ? I failed to understand that, because of this i'm hosting affiliates ads on my site.

  • Jerry

    Bloggers often misunderstood (or being misleaded) that being 'attractive and unqiue' is what the advertiser wants.

    Take David's story for example: at one point, your offer, that '$200 for exposure to a quarter-million people' – which convert into $0.8 CPM, seems like a steal and it's just plain stupid for not taking the deal. HOWEVER, with (almost) every investment on Internet can be tracked and measured, you need a lot more than just 'a quater million visitors' to justify the value of a text link ad.

    Can this “quarter-million people” turned into 1,000 leads per month? Can this 1,000 leads turn into 10 sales thereafter? How much profit is there for me in one sale? And, how many sales do I need to make in order to offset that $200 text link ads and get a positive ROI? These are the questions that bother a serious, long term link buyers all the time.

    As a blogger who's 'determined to make others a better blogger', you should understand that the advertiser is not the only party to be blame in this case. You should know clearly that there are too many blogs out there often overcharged their advertisers and failed to deliver. Advertisers do not owe you money just because your blog is attractive and draws a lot of meaningless readers who want to kill some office time. Advertisers are in business to make money as well. ;)

  • http://www.memorybits.co.uk/ usb flash drive

    It really is a good idea to market a service or product that is unique and stands out from the rest. I spent a few minutes a day looking at competitors and are figuring out what they offer can not be done by. We work when we have the unique set of services can stop a solid.

  • http://www.sfihomebizz.com Kavita

    I think the guy just kept his thinking to the type of advertising text or banner but he did’nt consider the amount of traffic he will be gettting at that price. Accepting that offer and getting that much traffic I don’t know how much money his site could have brought for $200 spent.