Rocketboom & Web 2.0: Need for New Advertising Models

Web 2.0 Revenue Model: The same Underpants Gnome Problem?
Via Steve Rubel, Marketwatch’s Frank Barnako mentions that Rocketboom is still searching for a viable revenue model with Rocketboom founder Andrew Baron mentioning that “It’s frustrating that we haven’t worked it out by now”.

For a website that has “200,000 downloads of Rocketboom shows, seven days a week”, this sounds like troubling news. But why is a “Web 2.0″-ish website still relying on tradition advertising models? Why the concentration on visitors, hits and downloads? Sounds very Dot-Com mindshare/Underpants Gnome (YouTube/Wiki).

Web 2.0 websites like social media websites have very poor CTR rates for traditional online ads compared to more “old school” online media. Assuming that ValleyWag’s report on Facebook is accurate, its very poor indeed. I would assume that a geek/tech vlog would experience similar issues.

Ads for Engagement not Eyeballs?
Rather than focusing on eyeballs, what about engagement of the audience?

Many of my colleagues at e-Storm have been pushing this idea around and its nice to see Shannon Clark do a great comment on it on Steve Rubel’s post:

“I listen to a lot of podcasts – one thing that Podshow at least is doing well in min estimation is in directly incorporating their advertisers into the CONTENT of the shows (generally by discussion of the advertiser by the hosts of the various shows). It is still clear what is being paid for – and as a viewer I have a stronger connection with the host – and thus at least a positive impression of the various brands (because they are supporting a show I enjoy). That said, I personally would prefer that brands which I had more interest in were supporting various shows.”

The content publisher can also go forward and directly ask the audience (via polls, voting, personal preference) the type advertisement the user wants: travel, electronics, BMW 355i, geek furniture etc.

This type of “push (giving advertisements to the audience) & pull (letting the user chose what type of advertisement)” creates good value for both the consumer (gets a commercial that he/she is at least interested in) and advertiser (gets the advertisement to someone who is actively interested). Hopefully, this would translate to higher CPM/CTR/CPA rates for the publisher and better conversion of the advertiser.

In practice, this would translate to a user being able to choose the pre-roll they would see before viewing an online video – this can be chosen on the spot or via registration. Assuming a registered user model, the publisher would have valuable demographic information to better sale ad space to niche advertisers.

This is all not original thinking I know, but it is one that more folks should considered if Rocketboom’s troubles become more common in the Web 2.0 world.

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