Website monetization is one of the more difficult topics facing the internet today. During the tech bubble ad rates and web sites were considered extremely valuable.
Since then the bubble has collapsed and additional factors have been introduced that complicate the matter even more.
The obvious solution to website monetization is the use of advertising. We are no stranger to this solution as the vast majority of sites on the internet also use ads.
Another metric often used is the number of times an ad is displayed. Typically this type of advertising is priced per thousand views. Many sites use display ads, the number of ads varies considerably and some agencies are now using programmatically defined ads that draw from databases of browser cookies and site use.
CLICK TROUGH RATE
The click though rate is used to determine the effectiveness of a given advertisement.. During the tech bubble of 1995-2000 this often exceeded 5% but since then the rate
has fallen significantly. Each year the average click through rate has fallen. The average click-through rate of 3% in the 1990s declined to 0.1%-0.3% by 2011. We have noticed click-through rates can be 1 per thousand or less.
Conversion is the situation where the visitor actually buys the offered product. Much study has been lavished on the conversion rate. In 2012 consumer confidence has improved. Confidence in 2013 continued the trend as the unemployment rate continued to drift lower.
A REAL EXAMPLE
Our popular PC gaming site serves over 600,000 impressions a month (Q4 2012) and gets about 0.05% click through rate. The conversion rate is about 1.64%. This amounts to a cash flow, albeit modest. The falling click through rate means we need more than 1,000x more traffic as compared to the income of the tech bubble period to achieve the same earnings.
One tough problem is the idea of banner blindness. This is where a visitor consciously or unconsciously ignores advertising on a web site.
Perceptual blindness is failure by a person to notice some stimulus that is in plain sight. This stimulus is usually unexpected but fully visible. This typically happens because humans are overloaded with inputs. It is impossible to pay attention to every single input that is presented.
The best-known study demonstrating relative blindness is the Invisible gorilla test. The subjects are told to either count the number of passes made by one of the teams or to keep count of bounce passes vs. aerial passes. In different versions of the video a woman walks through the scene carrying an umbrella, or wearing a full gorilla suit. After watching the video the subjects are asked if they saw anything out of the ordinary take place. In most groups, 50% of the subjects did not report seeing the gorilla. The failure to perceive the gorilla or the woman carrying an umbrella is attributed to the failure to attend to it while engaged in the difficult task of counting the number of passes of the ball.
Another interesting experiment displayed how cell phones contributed to blindness in basic tasks such as walking. In this experiment a brightly colored clown on a unicycle traveled by. The individuals participating in this experiment were divided into four sections. They were either talking on the phone, listening to an mp3 player,
walking by themselves or walking in pairs. The study showed that individuals engaged in cell phone conversations were least likely to notice the clown.
In 1995, Boston Police Officer Kenneth M. Conley was put on trial for claiming he did not see a violent assault incident between a few people while he was pursuing
a suspect. The real problem is sensory overload.
ITS THE ECONOMY STUPID
During the tech bubble there was a general feeling of wealth as the stock market advanced almost daily. Web site valuations were outlandish during the height of
the bubble. Today most web sites have corrected themselves in value more in line with real earnings. Over 99% of the firms established during the tech bubble are now gone.
eBay was forged during the tech bubble as an auction site. It expanded into an online flea market that attracts all manor of consumer electronics, garments, tools
and much more. eBay earns fees from vendors and they provide insurance to purchasers which make the service very popular. eBay also bought PayPal which provides even more security as eBay is a large company that continues to have solid earnings. By providing PayPal to every eBay user provided a strong secure service that has
made eBay a real success story compared to so many others.
eBay makes a good proxy for the economy as they are a large retail market on the internet. eBay also has ads on their home page, seems ads are popping up everywhere.
Some web sites now require a paid subscription in order to read their content. Many newspapers that moved to the internet have failed to adequately earn a sufficient
amount of income to cover the overhead.
Many newspapers now offer subscribers web access but this consumption of paper has issues. Disposal costs have risen over time. Forest products are more elastic but deforestation is another problem..
Users tend to click on banner ads that look like dialog boxes, complete with fake OK and Cancel buttons. Of course, instead of being an actual system message the banner is just a picture of a dialog box, and clicking its close box doesn’t dismiss it, but rather takes users to the advertiser’s site. This is unethical and illegal but hard to enforce.
Another unethical practice is to make an ad look like content. Being more honest with a site tends to build enormous credibility over time called goodwill.
Ad blockers are one of the worst nightmares for web developers. Now content is read for free without any prospect for revenue. This in effect defrauds the developer
and some rivals have actually closed as they could not overcome the problem.
We have developed some tools to detect ad blockers but we suspect we may need to resort to even more advanced techniques to protect our content. At present we
are testing the technology on a couple of our more popular sites and so far the effect is dramatic.
AD BLOCK PLUS
We believe that the Ad Block Plus browser extension has the ability to destroy the internet economy. All of our sites are ad funded and blocking ads deprives us
of much needed income. Many ad supported sites have already closed and many more are likely to follow.
Google’s own ad agencies are blocked by this tool and incredibly they allow Chrome users to install it. This is absolute lunacy. We have complained to Google several
times with take down requests but it seems they are ignoring the demand letters so we may be compelled to litigate to get the program removed permanently. Google’s
fax number is +1-650-253-0001 and we have sent many faxes to them.
Wladimir Palant is the person who currently develops this program and he has personally managed to cost the internet economy several billion dollars quarterly.
Another person or persons are maintaining a HOSTS file that is copied into the Windows drivers folders. The effect is DNS hijacking by redirecting the advertisements
to 127.0.0.0 which is the local loop back.
GameSpy has posted a goodbye on their site saying they are now closed and as of Q3 2016 the site is now down. A total of 12 people were involved in running the site. Uninstall GameSpy, GameSpy Arcade and GameSpy Comrade as they are all defunct. Games using GameSpy are now single player only and multiplayer is permanently disabled.
MOVING TO VIDEO
Some sites have changed from being an electronic newspaper to being an internet television station. Typically the article is proceeded by an advertisement. The
on-demand nature makes this more viable than conventional web sites facing closure due to ad blockers. The popular Reuters site has moved largely to video over the last couple of years. After some transactions, the new NBC News site become a very popular rival. During the financial crisis, CBNC was closely watched as
the general public watched the news unfold.
We have now moved the web site to the Microsoft Azure data centers. Today world+dog has jumped onboard with cloud services.
- DDR3 memory, 4096MB sticks
- Hard Disk (we have lost 3 disks in 201½012)