Web/Tech, Weblogs

Maybe Blogging Is Just a Loss-Leader?

I keep thinking about this blogging crossroads and the beauty of small. Then today came Robert Scoble's post about how tech blogging has let you down. It's not hugely applicable to me since I am a business reporter, and he takes pains to separate business blogging from tech blogging. But I think a lot of his comments have to do with the general blogging angst that seems to be sweeping the Web. Or, put another way: How money and the mainstream are killing what a lot of people used to love about blogging.

To me it goes back to the idea of rethinking the monetization element. After all, that’s the practical reason why people link bait, tailor content to huge audiences, play the PR game Scoble aptly describes, or in the case of Gawker give bonuses based on traffic. It’s near impossible to build a huge ad business off blogs with small audiences, even with a portfolio approach. So where does that leave us?

Subscriptions are always an option, but typically a very bad one. There is so much solid free content online, it’s hard to get people to pay for a blog—hell, it’s hard to even get people to pay for the Wall Street Journal. In the print world, subscription fees frequently just pay the cost of getting the paper to you. They’re not a profit center. And since there’s little distribution cost to the Web, it makes sense people would balk at paying.

So does the gulf just widen between the amateur bloggers and the larger, professional blogs that lose their sense of community, conversation, and--frequently—satisfaction? Is there a continual churn as A-list bloggers sell to larger companies or just burn out and fade away, only to have a newer hungrier, more rested crop take their place?

Maybe not.

What about blogging as a loss-leader for a broader individual media portfolio? It occurs to me that my blog could become a larger part of my business without ever bringing in any direct revenue. Consider the role my blog plays in just building and sustaining an audience of interested readers—or "my brand" to use that over-used word we’re all beaten over the head with these days. Ostensibly, if I’m doing my job well, the more that audience is fed and watered and delighted through easy bite-size consumption and a one-stop hub of everything I’m doing, the more it grows. And that makes me more valuable in all my other roles that do pay me: columnist, on-camera host, speaker and consultant. If you look at SarahLacy.com as a business, the blog isn’t a profit center. It’s my low cost personal PR, lead generation, networking, advertising all rolled in one.

That’s not too dissimilar from the rationale behind my User Generated Book Tour. Believe me—I’m not making a dime off that. In fact, I’m spending a good deal of Gotham’s money and a good deal of my own money to make it happen and make it happen in style. (In style meaning rad, highly designed give-aways like stickers, posters and Tshirts—not my personal style. I’m pretty much Motel-6-ing it up!) But the hope is by getting out there, getting people excited and meeting cool web enthusiasts and entrepreneurs outside the Valley echo chamber I sell more books. That in the end makes my next book deal that much more lucrative and/or realistic. The other hope is that I find the seeds of the next great tech companies—and as a reporter, that makes my marketability go up too.  And of course, the more people I meet, the more people are likely to become regular Tech Ticker viewers or Valley Girl readers. I may never know the exact ROI of the book tour. But that’s how business works. You take risks; you invest for growth.

Is my blog just my ongoing, online tour of everything I'm up to? In the last week, it occurred to me that this is happening now with lots of well known bloggers, it’s just not talked about as much as ad sales and traffic ranks. Two people I spent time with during the last week were “Somewhat” Frank Gruber and Julia Allison. Ok, they seem pretty different at first blush. But both have thrived by building their own personal media brand. Both built that brand through blogging but make the bulk of their income elsewhere. And, both of them have blogs that don’t depend on link baiting, band wagoning, and general traffic chasing. Makes me think this is indeed the future of blogging.

Now, I realize not every blogger has my situation with multiple contract gigs to pay the bills, but there are tons of opportunities to get them. There’s nothing magical or all that special about me. Any blogger with a brand or unique point of view has opportunities out there as media gets more fragmented and publications are hungry for good content without creating a staff position, or on the speaking and consulting side, as companies seek answers to Web 2.0 questions.

Of course, there's one huge caveat: This is more a recipe for sole-proprietors or a partnership than someone trying to build a huge company. While Michael Arrington could probably make a comparable salary on the speaking circuit, he wouldn't necessarily be building something larger than himself; something that could one day be worth hundreds of millions of dollars.

But I doubt most bloggers are trying to be the next Arrington. Most of them just want to support themselves blogging, right? This post reminds me of the phenomenon a few years back as the open source movement was taking off. So many smart coders were getting snapped up by startups like Jboss or  venture capitalists looking to fund the next RedHat that contributing to an open source project became like a virtual job audition. You didn't get paid for it, but it showed the world what you could do, and if that was good, you'd get far more money down the line. Sometimes a little faith and a little belief in yourself is all you need to get that job or lifestyle or even paycheck you've always desired. By focusing on ads and tailoring links and content around that, maybe we're actually selling blogging's revenue potential short.


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Can I get a free copy of OYLTYG for reading the entirety of that post?! (kidding I already bought 3).

I think Denton posted the Gawker revenues from 2007 but I can't find the post, here's this though:


12mm/yr with Gawker's audience seems like nothing, but if they got creative (like TechCrunch has) I'm sure they'd be able to make a hoard more.

I don't think it was covered enough when Carl Icahn got a blog a few weeks ago - this is really the first tycoon (maybe Mark Cuban qualifies before him) to write openly about what's going on inside public companies from a person-in-power position. I think Icahn is taking a big step in corporate transparency in America.

Bloggers like Icahn could trigger changes in the stock price, so I think that could be the answer to the first hundred million dollar blogger.

But then again, there are a flurry of laws against writing about companies you have equity in.

Blogging is very powerful for marketing if done correctly. It increases your Dunbar Number and introduces you to people who share interests.

Great post Sarah. Personally I see my blog more as a marketing expense coupled with fun and community than a loss leader. even if I won't be active in media and technology as a business, I'd still write about it. However, as I am providing services in this area, mainly knowledge, the blog is a strong marketing tool. And maybe, just maybe it works well because I don't treat it as such.

"There’s nothing magical or all that special about me."

Actually, what is magical and special about you is your smile. :)

Thanks for the thoughts, Sarah. Scoble's post was slightly depressing, as in - well, what IS the point of all this now? Thanks for bringing it back to the essence of all of our communications efforts (blogging, Tweeting, going on book tours, chatting on cell phones, etc.) - to connect as people. Once we accomplish that, what we can do next is unlimited.

Blogging is definitely going through some growing pains right now.

At this point, I think Personal PR is one of the most widely accessible values of blogging and has much greater potential to help people at lower levels of expertise/influence indirectly monetize their efforts. Saturation is so high in most niches, it takes a lot of time and dedication (and probably the lack of a real paying gig) to build a blog that's going to be a sustainable revenue stream for most these days. And really, even people making money off of blogging alone aren't just blogging.

Interesting post.... lots to think on.

Hopefully, the good bloggers are smart people, and realize the failure of current business model. The current glut of hopefully "ad supported" services has only weakened the model.
The success of niche blogging will hinge on an increase in value of targeted ad serving, with ad content dynamically served based on the user viewing it's Google, Facebook, or MySpace profile's and histories. I think the revenue stream will come from advertising aggregators that are selling your demographic, then parsing payments to the content you consume. Just as with print and television media we become increasingly desensitized to advertising's presence. The real value in internet advertising will lay in getting in front of the most relevant demographic, combined with the current level of activity in a given area. I see it as extending the search model of advertising across all of your online activity.
I also think that the current model of cable television will at some point be replaced by free content supported by ad's generated from the same information. Google seems to have it right, give us free stuff that works well, stay out of the way and we don't care how much info you get. But, charge us for services and try to make money off of our data and people scream bloody murder.

I feel you are on to something here and highlighted a number of concerns all bloggers need to be aware of when building a brand for them self. I find myself getting rather bored reading the A Lister's blogs. I look for more refreshing sites like yours and in this case I was rewarded with a great point of view. Thanks.

Thing is I blog for over 3 years now I have some blogs that I do make money and pay my living yet they are automized. Now I have my own blog that I recently open about 7 months ago and doing good when it comes to tech blog popularity. I have been featured on CNET and some other sites. Anways my point is that lately you really can't find quality content to read its either talking about social networks, who has more followers or companies acquired and to be honest I hate that.

Anyways great post. I enjoy reading it.

PS: found you via http://natalidelconte.wordpress.com/natalis-blog/ sidebar.

Twitter me sometimes.

Great post Sarah.

At my blog, I'm trying to market myself enough to, like you said, support myself blogging. Right now it is a side gig but is where my most passionate interests lie. Like we discussed on the Iterasi Magic bus following Gnomedex, I'd have a few freelance gigs, but I'm looking for some opportunity to do my mobile blogging and coverage full time.

It was great to meet you on the magic bus to Portland after Gnomedex, btw. Thanks for the awesome discussion on the bus ride.

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