PayPerPost.com has secured $3m in venture funding for a blog advertising business model generating a significant amount of controversy on the internet.
TechCrunch covered the news in their article Controversial PayPerPost Raises $3 million and then interviewed the VC firms and founder of PayPerPost on TalkCrunch.
TechCrunch and TalkCrunch have written and talked quite a bit about their perceived problems with the PayPerPost business model. Their arguments seem to focus on the perspective that bloggers should write as if they are journalists and that journalists should not take endorsements for the topics of their writing. They also claim that start up companies that can not generate interest about their services or products should not pay for advertising to generate buzz. The thesis of the argument being that if the company is so un-interesting that it can not generate natural buzz then it should not advertise and generate un-natural buzz.
TechCrunch seems to miss the point on several items. I’ll cover just a couple:
First, many freelance journalists write articles for widely circulate magazines newspapers and online sites for money today.
- Does it go on the front page of the WSJ? No.
- Do these articles make it into hundreds of thousands of publications everyday? Yes.
Second, TechCrunch seems to have a bias against smaller companies that are trying to create a successful marketing drive.
Third, TechCrunch seems to believe that a person can not write an honest review about a product service or anything else if there is money involved. Yet, there is a huge market out there for survey companies that provide money to a person in exchange for their time to complete the survey, typically a nominal amount of a few dollars. I filled out a survey for Yahoo the other day and they sent me a check for $15. Did Yahoo waste their money? Did I complete the survey and give Yahoo glowing endorsements in the survey? Definitely not. I was paid for my time and gave them an honest answer.
From the VC investors perspective, they main question is, Does the System work? They feel that the answer is yes. The answer has been found when advertisers come back and buying more ads and spending more. The cpm’s and cpc’s on PayPerPost ads are actually at very good levels.
TechCrunch makes the argument that PPP is offering links to advertisers sites at an average rate of about $10 per link, when the true internet value of a link from a website is closer to $100 - $200.
So my readers are you aware that when you see a hyperlink anywhere on the net that the value of that hyperlink could be worth one hundred dollars? How many hundred dollar bills do you see on this page right now?
(Note that I have two hyperlinks to TechCrucnh and Talk Crunch above and they are not paying me $200. However, I do also have a link to PayPerPost in this particular article and PPP is paying me $10.)
Similarly, I have several google ads that run on my blog and other websites. The links from google and other advertisers do not pay me anything for the individual link being present.
As a reader of a blog, would it be better to read a blog that had zero blocks of Google ads on it allowing the reader to focus on the headlines and the content of the actual site?
These are all interesting questions and its an intriguing argument that occurs in this podcast. Its really one of those arguments that could be fought out by anyone against advertising arguing with anyone that finds advertising of value in the marketplace.
Noticeably absent from the argument was any talk of the work that goes on behind the scenes in many A-list blogs to target specific keywords to attract the highest converting affilliate ads and Google Advertising.
TechCrunch states in the PodCast that nobody argues about the efficiency and bargain of the PayPerPost business model.
So it would seem that the two sides in the podcast agreed to continue disagree(trash each other), it remains to be seen how this will play out on the rest of the internet.
If you are interested in the levels of idealism of any of the members of this podcast from either side, you should definitely list en to the last 3 minutes.
The gold in this podcast is at the end!
Technorati Tags: PayPerPost, TechCrunch, TalkCrunch, Product Buzz, Paid Surveys, Internet Advertising, Internet marketing
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