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Blogging and big bucks
By CHRISTY LEE S.W.
The appearance of blog-advertising agencies is giving Malaysian bloggers a chance to cash in through online advertising. Bloggers share their thoughts on this new development.
According to a March survey on advertising expenditure by media services group ZenithOptimedia, Internet ad spending (adspend) is predicted to grow at 28.2% this year, seven times more than the rest of the market at 3.7%.
Advertising agencies are expected to spend about US$445bil (RM1.56 trillion) this year and about US$495bil (RM1.73 trillion) in 2009.
In the same timeframe, Internet adspend would grow from 7% to 8.7%, while newspaper adspend will drop from 28.3% to 27%, the report said.
NEW VENTURE: Tiah (right) and Cheo, founders of Nuffnang, a local company that puts up advertisements on homegrown blogs.With more people turning to the Internet for all sorts of information, news and services, it is no big surprise that advertisers are also eyeing the online space.
Typically, businesses place ads on professionally-developed content websites with high traffic, such as news portals.
Nowadays, advertisers are also keen to tap into a previously unexplored domain of self-published content sites – blogs.
Though blogs may attract a lot less web traffic than an online news portal but as long as there are viewers for blogs, it becomes a valid medium for advertising.
For bloggers, putting up ads on their blogs would seem like a nifty way to earn some pocket money through user-created content.
A new way to advertise
Timothy Tiah Ewe Tiam, 24, is one of the bloggers who thought he could earn some money through blogging during his varsity years in Britain.
When he and a friend ran a humour-themed blog several years ago, it became quite popular, and they used the advertising system AdSense by Google.
"Our earnings were low and Google made you wait till your account generated US$100 (RM350) before you could start cashing out. We waited forever to get anything out of it," Tiah said.
"So much for wanting to make a fortune from online advertisements," he mused.
When Tiah graduated, he teamed up with Cheo Ming Shen, to set up Nuffnang Sdn Bhd (www.nuffnang.com.my) – a blog-advertising community, the first of its kind in Malaysia.
If you're wondering why it's called Nuffnang; the name comes from a quirky combination of two slang words (spoken in inner city London) meaning "real good" or "real cool", according to Tiah.
Basically, Nuffnang enables local businesses to put up advertisements on homegrown blogs, and for bloggers to make some money off ads from their self-published sites.
"We saw that there was no system here that enables local companies to reach out to the blogging community – advertising on traditional media is very costly and the cheaper method of passing flyers is not effective," said Tiah.
Another advantage of blog-advertising is that it has a more specific audience which advertisers can target for more effective promotions of products, said Josh Lim, director of Josh Lim and Associates.
THE COMPETITOR: Lim (second from left) together with the Advertlets.com team. Wong (first from left) is the owner of the kinkybluefairy blog. Lim’s company deals with blog-advertising and is the direct competitor of Nuffnang.A month after Nuffnang's opening in February this year, Lim's company set up a similar community called Advertlets (www.advertlets.com) – a play on the words advertising and alerts.
"There's no point paying a lot to put up an online banner ad on a major website when it is not relevant to half its visitors," Lim said.
"Knowing that each blog has its own demographic allows advertisers to put up more relevant ads," he said.
Both sites generally offer a similar type of service and features. Both systems also work almost the same way.
Being in direct competition with each other, these two agencies have been diligently improving their offerings to best each other – much to the benefit of our local blogosphere.
While talking to members of the local blogosphere, In.Tech also discovered that bloggers have their own favourites.
At press time, Nuffnang reports to have over 20 million ad impressions monthly (every time an ad loads on a blog) while Advertlets currently has close to three million.
How it works
Basically, bloggers who sign up are asked to provide some initial data through a survey, which the blog-advertising system will analyse to create a profile of the blog.
Tiah believes that asking a blogger himself is an accurate way of finding out what his blog is about and who its visitors are.
"Bloggers know their readers best, and we believe they will tell the truth," he said.
However, these blogs must first have a certain average of unique visitors a day.
For Nuffnang, a blog needs to have at least 20 unique visitors per day, while Advertlets requires 50.
If a blog is deemed ripe for advertising, it will be put on the waiting list for advertisers.
A potential advertiser will then specify its budget and target demographics, while the blog-advertising system looks up blogs that match the advertiser's requirements.
Once the agencies get a nod of approval from both advertiser and blogger, an ad campaign would be created and the ad would appear in selected blogs.
Blogs would be grouped into different "bands" depending on the average number of unique visitors it had received a week ago, said Tiah of Nuffang's system.
BE SPECIFIC: A specific blog that has high traffic of above 4,000 unique visitors a day can net the owner RM5,000 to RM10,000 a month, says Davies."The higher the blog is on the band, the more money it can earn per ad campaign," he said.
Once a blogger has generated at least RM100 in earnings, he will be given the option to cash out.
A cheque would automatically be generated and delivered to the blogger, said Tiah.
Tiah said that in future, Nuffnang would be introducing more advertising models, such as pay-per-click and cost-per-action. Lim said Advertlets would also do the same.
When asked by In.Tech, both Nuffnang and Advertlets refused to disclose how their systems would actually calculate these earnings.
Joyce Wong, 24, owner of the blog titled "kinkybluefairy" (www.xanga.com/kinkybluefairy), modestly admitted that her blog earnings are slightly above RM1,000 – from running two ad campaigns by Advertlets in a month.
Her blog receives an average of 2,500 unique visitors a day, she said. "Seeing that this type of blog-advertising is still new here, it is more than I expected," Wong said.
Lillian Chan, who owns www.5xmom.com, wrote on her site that she earns three-digit figures per week from running Nuffnang ads on one of her personal blogs, which receives almost 3,000 unique visitors a day.
Gareth Davies, 29, who owns ShaolinTiger – Kung-Fu Geekery (www.shaolintiger.com), said his blog recorded around RM300 earnings this month from running Nuffnang ads.
He said his blog had an average of 800 unique visitors a day in that month.
Big bucks in niche blogs
One would think that a blog like Screenshots (www.jeffooi.com), one of the most visited sites in Malaysia, would be raking in thousands of ringgit a month from its ads.
However, its owner, Jeff Ooi told In.Tech that the Google ads on his blog only brings in about US$150-US$200 (RM525-RM700) a month, which is mostly used to pay off its webhosting fees.
Ooi uses AdSense, a contextual advertising system by Google.
Though Google AdSense is commonly used by bloggers, it is not suitable for every type of blog, according to Gareth Davies.
AdSense works by analysing what a site or blog is about and automatically generates contextually relevant ads from a database of advertisers.
The system would then calculate earnings based on several advertising models, including:
If a site or blog contains various subjects from travel to technology, the ads generated would be less relevant compared to a blog that talks about one subject in particular, Davies said.
"Only bloggers who write about very specific topics can use AdSense because the ads generated would be consistent and relevant to the content," Davies said.
Relevant ads means visitors would be more likely to click on them, which generates money for the blogger through the pay-per-click model.
"A specific blog that has high traffic (above 4,000 unique visitors a day) can net the owner about RM5,000 to RM10,000 or more a month," Davies said.
On the contrary, non-specific blogs – even if they have high traffic – would not benefit from the system.
A "general" blog with a fairly decent amount of traffic (around 1,000-2,000 unique views per day) would only generate earnings of around US$30-US$40 (RM105-RM140) a month, Davies said.
Fortunately, the new advertising model by agencies like Nuffnang and Advertlets is excellent for these type of blogs, which make up most of the blogosphere here, said Davies.
"Also, the ads are very localised, so Malaysian visitors would likely click on it as it is relevant to them," said Davies.
According to an online survey conducted by Microsoft MSN in November last year, 74% of Malaysian bloggers said they have no particular agenda for writing their blogs.
However, the big money is still in blogs that talk about specific subjects.
"Some of these bloggers who blog for a living own five or six blogs on different subjects – with each bringing in about several thousand a month, they can earn a cumulative of RM20,000 to RM30,000 monthly," Davies said.
In addition, full-time bloggers could also get paid for sponsored reviews. By signing up their blogs on ReviewMe.com (www.reviewme.com), advertisers could hire them to write reviews for a price, Davies said.
Another way these bloggers earn their keep is through TextLinkAds (www.text-link-ads.com), where bloggers sell the space in their blog posts for advertisers to put up their text links.
For the sake of money
Owner of the Fird's Domain blog, (http://fird.kucing-kelabu.com) who only wants to be known as Fird, says he has sometimes thinks about becoming a full-time blogger, because of how lucrative it has become.
He thinks blog-advertising is a double-edged sword.
"Sometimes I find that those bloggers who earn money from advertising tend to overdo it," said the 25-year-old technical support staff who works for a multinational company. "You can see that some of them focus so much on advertising efficiency that they clutter their blogs with affiliate links and ads everywhere – in the end it becomes almost impossible to read the actual content," he said.
And then there is the problem of splogs, or spam blogs, which are artificial sites created just to promote other websites.
Sometimes, creators of these splogs even copy content from other sites to be republished as their own posts.
"Most people won't complain if you make money from your own blog, so as long as you don't annoy other bloggers by advertising your blogs on their personal sites," Davies said.
Wong (of kinkybluefairy) agrees.
"Blogging for money is fine, it's just like publishing content in a magazine which you can sell,"
"When it comes to blogging, people can see whether you are writing sincerely or just doing it for the sake of money," she said.
Wong believes if a blog does not have good content, it will eventually lose its viewers anyway.
"However, even if a blog is bad, if it has posts containing keywords it will still show up in search engines," Fird said.
"People will go to the site and it will still get hits in the end," he added.
To blog or not to blog
According to Davies, who holds a day job in IT security, online advertising is still not very mature in Malaysia – and blog-advertising is only a small part of it currently.
"Online advertising is already big in North America, but it is still very new in Malaysia as we have yet to cultivate a habit of purchasing products online," said Ooi (of Screenshots), who works as an Internet and e-business consultant.
"There is almost a complete lack of e-commerce here," Davies added. He said that during his time in Britain, he did almost all of his shopping online, except for when he was buying clothes.
Davies added that it also does not help that Malaysia is blacklisted in certain countries as a hub for credit card fraud.
"It is a cultural thing in Asia, where people need to see and touch a product before they purchase it," said Ooi.
For now, Ooi believes that advertising will still mostly be led by the mainstream media, such as newspapers.
"Print media will still be in command and that would be followed by electronic media, while online advertising has a huge curb to climb, particularly in Malaysia," he said.
"Most local advertising agencies have not really understood the dynamics of online advertising," Ooi said. Davies agrees.
"Global companies such as Sony, LG and Intel already know the value and have started to invest in online and blog-advertising, but the local companies are still generally set with print ads," Davies said.
Perhaps this is also because, unlike traditional media, there are no reliable ways to measure the effectiveness of an ad campaigns in blogs or to even verify if a blog has as much traffic as it claims, Ooi said.
"Businesses confidently advertise in traditional media because there are reliable statistics that calculate the cost and effectiveness of it, which blogs currently do not have,"
Ooi believes the situation would improve when the Audit Bureau of Circulations Malaysia launches an audit process for websites at the end of the year, which it announced during its "Lie Detector" campaign in March 8.
However, he believes that in Malaysia, traditional print media will still command the majority of advertising budgets.
In the ZenithOptimedia survey mentioned earlier, even though Internet adspend is growing at a fast rate globally, television, newspapers and magazines will still make up the largest piece of the pie for several years to come.
For the next five years at least, Ooi does not expect that blog-advertising in Malaysia would take off in a really massive way.
"Bloggers could probably earn some decent pocket money from it, but it might not pay the bills well enough for them to quit their day job," he said.
Despite this, Ooi said he would still give local blog-advertising agency Nuffnang a try and even put up one of their ads on his blog.
"They're the aggregators of online advertisement, and I'd like to support the industry so that it may grow," Ooi said.