Internet Advertising on the Rise
Paul Kedrosky posted an interesting article on the first decade of Internet advertising that verifies iA’s prognosis that we are heading straight into an era of highly profitable Internet advertising:
Now, don’t get too excited: As Jeremy points out, if you plan to build a 50 Million Dollar business based on an ad model, you still need a ****load of traffic. Tim O’Reilly breaks it down:
- At the $1 RPM (CPM/CPA/CPC) level achieved by most general sites, you need 4 billion page views/month.
- At the $5 RPM level achieved by demographically targeted sites, you need 800 million/month.
- At the $20 RPM level achieved by highly targeted sites, you need 200 million/month.
So if you still plan to make a lot of money, don’t start another social network. Here is what you do: You found an Internet ad agency and start making good online advertisement. This industry is going to explode very soon and as far as I can see the competition in the field of intelligent online advertisement is really sparse.
Update: Recovering Journalist: “The latest numbers from the Newspaper Association of America show print newspaper advertising revenue continuing to drop: down 1.7 percent in 2006 to $46.6 billion. No news there–the usual doom and gloom. But there’s another interesting number in the NAA report: Advertising revenue for online newspaper sites jumped 31.5 percent in 2006, to $2.7 billion. “
Randomtech: “Time also switched its publication date to Friday from Monday, cut 50 people from its staff, shut its bureaus in Chicago, Atlanta and Los Angeles, and invested more in its Web site. It further saved costs by contracting with more columnists, who, as established writers, are less expensive than full-time staff journalists.”Ð