When blogs first arrived on the digital scene several years back, few bloggers imagined they could make their living from ad revenue generated because of consumer visits to their sites. But consumers are spending more time online and they often read blog site content. Meanwhile, the blog industry has matured enough to offer marketers efficient ways to advertise on these sites. Blog networks, conglomerations of blogs devoted to specific topics, are springing up and shaping a central control for the flow of ad money.
A New York Times article recently highlighted one of these networks, Sugar Inc., which boasts of “12 blogs, 11 million readers a months and advertisers like Chanel and Sony.” Sugar is expecting to double its ad revenue this year and another blog network, Gawker Media, is also looking for a significant revenue increase in 2009.
The success of blog networks is connected to their ability to narrowly target audiences when it comes to ad revenues. For example, the blogs under Sugar’s umbrella are “edited and designed with 28-year-old women in mind.” By updating content frequently and competing for exclusive content, blogs ensure a constant audience, historically an audience that read fashion and shelter magazines. The other attractive piece of the puzzle for marketers is that online ad space is much less expensive than in traditional magazines. The big question is whether this financial imbalance can continue. As consumers continue to read online, blog networks may grab more advertising dollars but industry experts also note that staying profitable has required these companies to partially rely on other revenue streams such as from e-commerce.[Source: Miller, Claire. Ad Shift Throws Blogs a Business Lifeline, New York Times, 9.14.2009]