I, like many other media-folk, nodded quietly to myself while reading the book The Long Tail. Just to recap: the basic premise of the book is that in the pre-Internet world there was only so much shelf space, so many media outlets, and only so many genres. With the Internet making “store size” limitless, so are the products. Therefore, you can find that obscure record you always wanted on eBay, but never in Walmart.
In terms of media, the Web was also supposed to put the barriers of entry so low that any kind of publication or media outlet could be conceived, thus creating an unlimited capacity for niches. Beyond the surface level I don’t think this is true. There is only one real niche on the Web. I suppose what I really mean, is that there is only one profitable niche: Nerds.
With only a few exceptions, the only demographic that can generate substantial traffic on the Web is nerd. Gadget loving, Web 2.0 nerds. Let’s look at the head of The Long Tail.
As of July 10th, the first 50 of the Technorati Top 100 currently looks like this:
| Type | Amount | Percent |
| Tech |
28
|
56%
|
| Politics |
9
|
18%
|
| Business |
4
|
8%
|
| Media |
2
|
2%
|
| Celebrities |
2
|
2%
|
| Other / Personal |
5
|
10%
|
*Numbers may be wacky because I was a journalism major.
The top blogs at Bloglines and Google Reader (older, but still indicative) have a similar outlook. I would venture a guess that all of these blogs are profitable or could be profitable (blogs like Post Secret have no ads on purpose).
When one shifts away from the written word and to video the results are the same. How many IPTV networks can you name? I can only name Revision 3, which caters to the “Internet, on-demand generation.” The most successful audio podcast network after NPR is most likely the TWIT network which features an all tech-related lineup.
The top podcasts in iTunes are nearly all mainstream media outlets. The iTunes store has no way of looking past the first 100, but it shows how hard it is for the everyman to have a widely dispersed podcast (Also, I believe the top 100 podcasts section only measures a few weeks of activity and not overall subscription levels - so this is a hard barometer to believe).
Now, this theory has a very obvious bias: I fall into said nerd demographic. But I associate myself with, you know, non-techie people. I don’t know many people that are watching non-man-gets-hit-in-the-nuts quality YouTube videos or downloading independent podcasts. My mom doesn’t subscribe to RSS feeds, and less than a small handful of my friends use Web 2.0 services like Twitter.
This makes it particularly hard for nich online-only media. Just by cracking open my Writer’s Market I see trade publications like The Fruit Growers News, The Cruise Industry News, and Reunions Magazine (covering reunions of all types!). Are farmers subscribing to RSS feeds? Is a cruise ship captain perusing blogs? I’d guess no, yet they all have there own trade publications with highly targeted advertising.
In the blog world most people automate their advertising via AdSense, text links, and other ad services. While these services offering contextual ads, the premium is not comparable to “old media”. Take the fruit growers publication for instance. With a circulation of 16,000 they charge over $2000 for a 1/3 page four color ad (media kit). If I started a blog on fruit growing do you think I’m making 2k a month with AdSense? I’m well aware with that expenses for a print publication are higher, but do you think I would have the same profit margin?
Despite what we would like to think, the online medium is not nearly as ubiquitous as we would all like it to be. This, of course, puts newspapers in a precarious state. They can’t maintain serving the shrinking non-wired generation with high production costs forever. Nor can they devote gobs of money to an online market that is still catching up in advertising.
The point is that while the barriers to create content are lower, the perceptions of advertisers and the general public is lagging behind. Until this gap is closed, those residing in the long tail of ad-supported content driven sites will be only scraping by. Or worse, they won’t have sufficient money to remain open very long.
I posit this theroy not because I want it to be true, I share this because I want someone to prove me wrong. Please do.
4 Comments
Link
Hi Sean,
You’re mistaken. But don’t feel bad. It’s a mistake that is made by loads of people in media.
To start, let me say that yes, actually, farmers are subscribing to RSS feeds. In fact, farmers were one of the first markets to embrace electronic journalism. Long, long before there was a Web, there were a series of products aimed at providing pricing data and related news to the agriculture world. The best-known of these is the Data Transmission Network, known in the farming world as DTN. It’s still around. Check out DTN.com.
And it’s not just farmers that “get” the Web.
I’ve spent the past few years working as a consultant with trade publications as they make the move online. And as a general rule, they have done a much better job at this than have mainstream newspapers or consumer magazines.
In today’s world, trade publishing is generally called B2B (business to business) publishing. And there are hundreds and hundreds of profitable B2B sites on the Web.
Let’s look at some of the examples you picked.
First, you mentioned farmers and a publication called “Fruit Growers News.” I don’t know that particular magazine. But I do know successful Web-only sites such as Agwired and the Perishable Pundit. The traditional, print-based publishers in the ag space are also doing pretty well online. Take a look at ThePacker.com (Vance Publishing) or Agriculure.com (Meredith Corp.)
In fact, the same holds true for every niche you can think of in B2B.
Let’s take marketing, for example. There’s a Web-only publisher (Watershed) that is making money running sites such as MarketingVox and MediaBuyerPlanner. Those sites compete against other Web-only sites such as MediaPost and the sites of traditional B2B publishers, such as Penton’s Chiefmarketer.com.
Or let’s look at some of the big-money markets, like pharmaceuticals. There’s Pharmalot, a blog by a newspaper reporter. It competes against sites from Crain (ModernHealthcare), Advanstar (BioPharmInternational.)
Or how about, say, machine tools. Check out Practicalmachinist, a Web-only forum that is now owned by American Machinist, an old-time B2B publisher.
The key to all of these operations is the same as the key to traditional B2B publishing — highly targeted advertising (often white papers and other lead-gen products) and a tremendous amount of specialized editorial coverage. It’s a very different world from B2C, or even from the tech-dominated world seen by looking at Technorati rankings. In B2B, the size of the audience is small by design. (In print, this is called controlled circulation.) To make money in this space you don’t need a lot of readers, you need the “right” readers.
So, to answer your question, it is possible to make $2,000 a month from a fruit-growing blog. It’s possible to make much, much more than that. But you won’t do it with AdSense. And you won’t do it if you look down your nose at the market niche.
If you really want to dive in deeply to the world of B2B, follow the developments at the American Society of Business Publication Editors or its international sister group, TABPI.
Or, if you’ll excuse the plug, take a look at my blog. B2B is my life.
Thanks.
Link
Well, clearly I am no Paul Conley, but in your premise, it’s not allowing for growth. In 1715, only elites were reading newspapers, no - or at least largely so. I don’t think newspapers were general interest… really broadly general interest until later. Ain’t nobody getting down to RSS feeds now, but I figure they … or something like them… will be wildly more popular with your much cooler, non-Internet-obsessed friends. This Web movement is really younger than you are, and you’re a baby. Small moves. JohnDeere.com/blogs is totally gonna blow up, I know it. But, I defer to my man Paul Conley.
Link
Im sure there are farmers that check RSS feeds. But is it enough to justify a Web only publication? Judging by the success of companies like Watershed, maybe the answer is yes.
Thanks for taking me to b2b school.
Link
From your comments, little wonder that there are more bloggers in the world than readers (I made that up, but it is probably true - go random blogspotting and you’ll get the drift).
BTW there is ad technology that will de-nerd the Internet - generate ad revenues that will attract your Mom et al willy nilly. It is currently operating, but as most decision makers are either nerds or thick as bricks it will take time to get noticed.