WSJ on blogads

A nice article about blogads in the Wall Street Journal this morning. My favorite quote comes from Markos Moulitsas Zuniga: “I even get some money over to the college fund for my baby.” Here are some excerpts:

Blogs Grow Up:
Ads on the Sites
Are Taking Off

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The Chandler campaign is evidence of the latest step in the evolution of the Internet. Blogs, once derided as solipsistic exercises by self-important nobodies, are starting to go commercial as their readership grows.

The trend is in its early stages; big advertisers like Coke and Procter & Gamble aren’t yet hawking their wares on blogs. Indeed, much of the advertising is found on politically oriented blogs, which are experiencing a spike in readership from the presidential election. Many people wonder if the blog ad boomlet will outlast the election.

But other Internet institutions have had similarly modest origins; recall that eBay started out as a place to trade Beanie Babies and Pez dispensers. And it’s no surprise that as blogs grow in popularity, they are beginning to attract advertisers. Indeed, the entire Internet has been experiencing an uptick in ad revenue, with advertisers beginning to open their wallets again for the first time since the collapse of the dot-com bubble in 2000.

Typical of the new breed of “bloggerpreneurs” is Markos Moulitsas Zuniga, who runs Daily Kos, a liberal political blog. Mr. Moulitsas says he initially wanted to keep his blog ad-free, as a way of preserving his independence.

But in December, he had to buy new server computers to keep up with growing traffic, and he started taking ads to pay the bills. Business was so good that in three months he was able to double his ad rates. Now, he’s bringing in $4,000 a month.

“That is phenomenal to me. I even get some money over to the college fund for my baby,” says Mr. Moulitsas.

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Still, blog ads are in their infancy and the operators of these sites face big hurdles in luring more of them, ad experts say. “Over 90% of the business of Internet ads [goes to] 20 large, established news media like nytimes.com and WSJ.com. Honestly, the blogs haven’t hit the radar yet,” says Stu Ginsberg, public-relations director at the Interactive Advertising Bureau, a trade group for Web sites that take ads.

Yet the blog ad trend is far enough along that at least one company has sprung up to serve the market: Pressflex LCC. The Chapel Hill, N.C., company’s Blogads service connects advertisers with a network of bloggers, charging 20% for its efforts. So far, it says it has placed ads on about 200 blogs.

“They said nobody would want to advertise on personal diaries. Even my wife thought I was crazy,” recalls Henry Copeland, who founded the company in 2002. Now, he has three programmers working for him in Hungary.

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Still, only the top blogs can snare ads from mainstream companies. Most others have to content themselves with ads from candidates, with conservatives typically advertising on conservative blogs, and likewise for liberals.

Other blog ads are for somewhat quirky products, such as a CD with humorous Christmas songs sold by Paul Libman, a Chicago composer. It’s an effective medium, Mr. Libman maintains; thanks to $450 in blog ads he sold 1,000 CDs during the holidays, twice as many as earlier seasons.

“I don’t think that the bloggers realized how much these ads are worth,” he says. “Next year it will be much more expensive.”

Indeed, the topic of blog ads, and how much they are worth, has become a theme in the discussions that bloggers have about their work on their own blogs.

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