Is Online Advertising About to Die? Should We Freak Out?

25 | Posted In News by David

It shouldn’t be a surprise to anybody that 2009 is going to be a challenging time for many. The economy is in a recession and that recession is likely going to continue into 2009.

The biggest danger with this kind of thing is the effect it has on people’s mindsets. If people THINK things are going to suck, THEY WILL SUCK. Herein lies why I like to tell people to not pay much attention to the news.

But, Techcrunch posted a story worth making note of. The story says that content sites are bracing for as much as a 50% drop in revenue. The cause will be online advertising budgets being slashed.

A majority of blogs out there that make any money do so via online advertising. So, this is going to most definitely affect them. It is customary to see ad revenue increase during the holiday months. It is also customary to see it fall off once January hits. The degree of that drop-off depends on the niche of the website, but there is no doubt that this 2009 recessionary mindset is going to amplify the usual end-of-year drop-off in ad revenue.

So, here is what you need to be thinking about and doing as we head into 2009:

  1. Lean the mixture and don’t spend money like its going out of style.
  2. If your revenue is primarily advertising based, you need to quickly maneuver to set up some in-house revenue streams. Information products, membership sites, etc. Set up revenue streams that you have control over.

Realize that money will continue to flow in a recession. People will always spend money on things they want. But, if you’re positioned to depend on big companies and their ad departments to get by, you need to start taking out this middle man and start generating your revenue in-house. This puts you in the driver seat. Then the ad revenue is gravy.

So, to answer my question: No, you shouldn’t freak out. Just be smart and starting treating your blog like a business.

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  • http://imwithjoe.com/ Normal Joe

    Good post David…I agree with your advice too. I think we should all have multiple streams for this very reason. If we only rely on advertisements, then situations like this can alter our life drastically.

    On the other hand…if you have other things going in house like products and memberships, etc…then you’ll be able to focus more effort on bringing people into that funnel and compensate for the loss of advertising revenue.

    Good stuff man.

  • http://imwithjoe.com Normal Joe

    Good post David…I agree with your advice too. I think we should all have multiple streams for this very reason. If we only rely on advertisements, then situations like this can alter our life drastically.

    On the other hand…if you have other things going in house like products and memberships, etc…then you’ll be able to focus more effort on bringing people into that funnel and compensate for the loss of advertising revenue.

    Good stuff man.

  • http://www.mikeslife.org Mike CJ

    Nail on the head as usual David. We do need to treat our blogs as businesses. And just like conventional businesses, we need to make provision for a downturn in 2009.
    However, I suspect that online advertising will not suffer as much as off line advertising for two reasons:
    1/ The relative cost is much, much smaller – even the most enlightened of businesses only spend a small percentage of their marketing budgets online. When they do cut budgets, and they will, it will be in areas they can make large gains – witness Honda pulling out of formula one.
    2/ On line advertising is still a growth area, with new businesses switching on to it all the time, and that will continue with the businesses which are going to survive and prosper through this recession.
    So my advice is to keep building, and keep working at it – those of us who do come through this will be in poll position for the post recession boom when it comes!
    Happy 2009!

  • http://www.mikeslife.org Mike

    Nail on the head as usual David. We do need to treat our blogs as businesses. And just like conventional businesses, we need to make provision for a downturn in 2009.
    However, I suspect that online advertising will not suffer as much as off line advertising for two reasons:
    1/ The relative cost is much, much smaller – even the most enlightened of businesses only spend a small percentage of their marketing budgets online. When they do cut budgets, and they will, it will be in areas they can make large gains – witness Honda pulling out of formula one.
    2/ On line advertising is still a growth area, with new businesses switching on to it all the time, and that will continue with the businesses which are going to survive and prosper through this recession.
    So my advice is to keep building, and keep working at it – those of us who do come through this will be in poll position for the post recession boom when it comes!
    Happy 2009!

  • http://www.mikeslife.org Mike CJ

    Doh! “Pole” position even – Freudian?

  • http://www.mikeslife.org Mike

    Doh! “Pole” position even – Freudian?

  • http://www.thefreebieguy.net Leslie, The Freebie Guy

    Woohooo, My thoughts exactly. Hey, I’m a relatively new blogger. I started my blog in September since joining Blog Mastermind with our Friend Yaro. It’s been going very well so far.

    I’ve been actually thinking about the same topic and I KNOW beyond a shadow of a doubt that we can create a recession in our own minds. But if you set yourself up for success (as you have done and I’m in the process of doing), financial success will follow.

    Making sure you aren’t codependent is crucial. Thanks for the post and reminder. Take care man!

  • http://www.thefreebieguy.net Leslie

    Woohooo, My thoughts exactly. Hey, I’m a relatively new blogger. I started my blog in September since joining Blog Mastermind with our Friend Yaro. It’s been going very well so far.

    I’ve been actually thinking about the same topic and I KNOW beyond a shadow of a doubt that we can create a recession in our own minds. But if you set yourself up for success (as you have done and I’m in the process of doing), financial success will follow.

    Making sure you aren’t codependent is crucial. Thanks for the post and reminder. Take care man!

  • http://www.astro-geek.com/ Christopher

    Don’t just be smart. Be S-Mart.

  • http://www.astro-geek.com Christopher

    Don’t just be smart. Be S-Mart.

  • http://mgrbytes.blogspot.com/ Bobby Clark

    Great post David. You’ve earned your vacation. . Diversification is key for financial independence. If people are dependent solely on their corporate jobs, starting a blog or other means of financial diversification, would definitely help take the sting out of an un-anticpated job layoff.

  • http://mgrbytes.blogspot.com Bobby Clark

    Great post David. You’ve earned your vacation. . Diversification is key for financial independence. If people are dependent solely on their corporate jobs, starting a blog or other means of financial diversification, would definitely help take the sting out of an un-anticpated job layoff.

  • http://jymsroad.wordpress.com/ Jim Gray

    Great advice, thank you for posting!

  • http://jymsroad.wordpress.com/ Jim Gray

    Great advice, thank you for posting!

  • http://www.postlinearity.com/ gregorylent

    the symphony, opera, theater, many very high art forms have to deal with “lack of advertising” … about time mere blogs learned how to do it too …

    the self-importance of the blogosphere, that their little habit is worth supporting, is amusing …

    businesses are in the business of adjusting, and will. or not…

    enjoy, gregory lent

  • http://www.postlinearity.com gregorylent

    the symphony, opera, theater, many very high art forms have to deal with “lack of advertising” … about time mere blogs learned how to do it too …

    the self-importance of the blogosphere, that their little habit is worth supporting, is amusing …

    businesses are in the business of adjusting, and will. or not…

    enjoy, gregory lent

  • JohnC

    Great post. Thanks much. My 2 cents: I started using proximic.com contextual advertising service and am quite satisfied with it so far. It is a nice way to diversify my revenue stream by adding a service with covers the long tail in my contextual advertising needs. I am looking for a good In-Text Advertising technology, so please let me know which one you recommend. Happy New Year 2009!

  • JohnC

    Great post. Thanks much. My 2 cents: I started using proximic.com contextual advertising service and am quite satisfied with it so far. It is a nice way to diversify my revenue stream by adding a service with covers the long tail in my contextual advertising needs. I am looking for a good In-Text Advertising technology, so please let me know which one you recommend. Happy New Year 2009!

  • http://SourcesOfInsight.com/ J.D. Meier

    People will still spend money and online is convenient.

  • http://SourcesOfInsight.com J.D. Meier

    People will still spend money and online is convenient.

  • http://aplawrence.com/ Tony Lawrence

    Umm, advertising INCREASED during the 30′s depression..

    My Adsense income is actually up slightly since the crash.

  • http://aplawrence.com Tony Lawrence

    Umm, advertising INCREASED during the 30′s depression..

    My Adsense income is actually up slightly since the crash.

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  • http://www.best--hosting.com/ Kenny

    Hi

    I remember when the advertising on the net last time, it has its ups and downs, I had at that time several money making websites through affiliate marketing, yes they did suffer during the slack period but bounced back after about 12 months.

  • http://www.best--hosting.com Kenny

    Hi

    I remember when the advertising on the net last time, it has its ups and downs, I had at that time several money making websites through affiliate marketing, yes they did suffer during the slack period but bounced back after about 12 months.