Why content sites are getting ripped off

Here's a question that no one has asked yet:

Why should content sites be compensated at all?

When I first read this topic, I thought it was content sites as in nytimes going into Iraq and reporting on the war or netflix/ireel streaming hollywood movies or other such original content.

But really, what we're talking about here, is review sites. Personally, I could start a review site on stuff I liked for almost 0$. I could host it on a server I already co-locate and my peers would trust me simply because they have no reason not to. As soon as you start adding financial incentives, ads at all, you lose a bit of credibility.

You do gain that credibility back though by point out exactly what conditions you got the product under (free review product, paid out of your pocket, paid-for review, etc).

I don't disregard paid-for positive reviews. I just do more research on them. I'm sure that the future for content sites is to have a few sales people on staff to goad companies into buying paid-for posts which are clearly demarcated as such.

I don't care if a post is paid-for as long as the post itself checks out. If I see a post on gizmodo or a more obscure blog such as high-scalability mark itself as paid for I won't say oh that's wrong, I'll say oh that's interesting, better check it out. I'll google it and find many other source and if it seems worth my time try it out myself.

Personally, I think it's another avenue for sales, it's just one of the huge number of avenues for the next generation of marketing that is become increasing disconnected from the traditional avenues that have been well studied in the past.

Very good point, but I'm not sure there is a valid solution for this, in part because intent generating sites are often only good at generating intent if they're seen as being impartial. If the blog post you're reading exposes that they'll make a profit if you buy the widget they're talking about, you're much less likely to trust that blog post.

So the intent generation and intent harvesting may need to remain separate. This does raise the question - how can intent generation be rewarded? Well, there are several answers to that. Intent generation is a side-effect of being someone whose opinion is paid attention to (whether for the span of a single blog post, or as a regular source of information and insight). There are many ways to derive profit from being someone people pay attention to regularly, other than direct affiliate marketing of the products you're talking about, so I'm not sure the problem is as critical as this blog post is making it out.

Certainly, as things are, only prolific, popular bloggers can make a living from blogging - but is it really reasonable to expect occasional or occasionally good bloggers to make a living from it? I'm not so sure.

In short, I'm not so sure that this is a problem that needs to be fixed.

For ways to make money from your blog, I'd recommend Steve Pavlina's excellent post on the topic:

http://www.stevepavlina.com/blog/2006/05/how-to-make-money-f...

This is a tough one to call. If intent generators like Gizmodo were offered better affiliate-based deals then their impartiality would be compromised which would damage the integrity of the business itself.

The problem might just be that the market isn't properly pricing intent generation right now, and because of that companies can exploit that price gap and purchase a lot of intent generation advertising relatively cheaply.

Apple is a good example of this. They seem to spend a lot on intent generation advertising: TV ads, major branding campaigns on nytimes.com, prominent billboards, etc. All this works to make people want to buy Apple products.

However, this can only work for products where the advertiser monopolizes a product that is differentiated enough. For example, no company has an incentive to pay for intent generation for travel to Hawaii, because no company can capture all the profits from more people going to Hawaii. Someone after getting the idea to go to Hawaii will be just as likely to purchase from a competitor.

I think over time, as we get better at measuring the impact of intent generation, we will see more and more spend on that kind of advertising and rates will rise as companies that decide to spend on intent generating advertising do better.

I think the way this usually works out is that content sites, to remain impartial, serve intent generation ads for products other than those for which they are serving content.

For example, the Gizmodo front page right now has content about Droid, Apple, some headphones and an article about netbooks leaked from CES. While people are there reading these articles, they are exposed to ads for Geek Squad, Sony, or GameStop.

The intent generation ads are kept separate from the content, but appeal to a similar audience. Tada. This is not far from tv ads attempting to target particular demographics - it's clear that late night comedy isn't endorsing Girls Gone Wild, but they can exist in mostly the same space.

if content sites were generating real intent - and gizmodo, engadget and a few others certainly are - they could add direct affiliate links to those selling the products, and would make a lot of money in affiliate fees. Or just sell high CPM ads, like they do now, because advertisers understand these sites do generate real intent. However, most "content" sites generate little intent and all they have to offer advertisers are banner ads that don't work much, and don't get paid for much. How weird.