Help me fine-tune the LG advertising model

Indy_Truck1Indiana Jones: Meet me at Omar’s. Be ready for me. I’m going after that truck.
Sallah: How?
Indiana Jones: I don’t know, I’m making this up as I go.

I’ve made up my mind to try auctioning local ads here on LoGroNo.  But those pesky details! Here’s my current thinking… and questions.

  1. Limited number of advertisers; limited placements
    An auction model requires some element of scarcity to the item(s) being auctioned. So my thought is only accept X number of advertisers for a given banner placement.  I’ve currently got three areas: upper left sidebar (vertical shape), upper right sidebar (large square), middle right sidebar (4 small squares). 

    This will hopefully prevent some visual clutter, as there won’t be ads scattered all over the site nor having one long sidebar filled with them.

    I thought I’d start by having up to 4 advertisers in rotation for each of the two large banners, and up to 8 advertisers for the four small banners.

    I’m not sure if the time-blocks should be a week, two weeks, or a month but I’m leaning towards a two-week period.

  2. Winner bidders pay the same rate, the lowest of the winning bids
    In order to make it be/feel fair, the winner bidders for a given banner ad should all pay the same rate.  Therefore, when the bidding ends, and the highest bids are determined, everyone would pay the LOWEST bid of the winning group. For example, if Business A was the highest bidder at $50, Business B was 2nd highest at $40, Business C was 3rd highest at $35, and Business D was the 4th highest at $25, then everyone would pay $25.

    In order to prevent a bidder from thwarting subsequent bids by bidding a high amount in hopes of then locking in the low amount of the 4th highest bid (example above), there would likely have to be a maximum increment requirement, eg, you can only raise the bid by $10 or less.

  3. Auction conducted in a community, social-oriented atmosphere
    I was planning to use eBay while experimenting with this model but then it occurred to me that it might be more fun and in keeping with the community-oriented spirit of LG to conduct the auctions right here in a blog post.

    Maybe I’ve been spoiled by Ed Kuhlman because all his fundraiser auctions I’ve been to in the past five years have been such fun.  Why not try to have a little of that here? Here’s how it might work. 

    I create three blog posts for each ad banner auction. (Maybe I do them all at once or maybe it’s better to space them out over several days.) Bidders attach comments with their bid amounts.  (Each comment is automatically time/date-stamped and can’t be edited.) Just like a live auction, conversation is allowed. Comments by non-bidders are allowed. Everyone can join in the fun.

    It might be a little more controlled if bidders were given WordPress accounts so that we could verify them ahead of time. I’d like all bidders to have a Gravatar, too.

So let’s discuss both the rationale of this approach as well as the pros and cons of the implementation plan.  I’d particularly like to hear from potential advertisers, of course, but the discussion’s open to everyone.  I’d appreciate it.

68 thoughts on “Help me fine-tune the LG advertising model”

  1. Griff, I’m not criticizing the News because I can see the difference in the formats and I know they’re paid content just by looking at them. I can see now that it might be confusing to lay people. And if I go to the next advisory board meeting I’ll suggest putting a clear advertisement disclaimer on those pieces.
    All I’m saying is, look at legitimate online sites and tell me where this is going on the way you propose it. There are ways to do sponsored content, but not in the news column.
    ESPN and the NFL sports shows are geniuses at having the Nokia highlight of the game and the Budweiser MVP, so I get that there are product placement and sponsorship practices that are maddening.
    You need to decide what you are and then go for it. Are you a community news site, a civic journalism exercise, a commentary site, a business promotion site with some commentary, one man’s view of the world as seen through the eyes of his business clients? You have banged on the News for not cooperating because you weren’t competition, but clearly now you are. You want to talk about the community, but now you will only talk about events of advertisers, or maybe you will talk about other events if it’s one involving a friend or client. How will your advertorial sponsors feel if they pay for event notices and then you hype an event at the Cow?
    A few months ago, you were going to sell memberships to fund original news reporting, which gave the feeling of public radio, then you switched to selling news story space to run press releases, which is the opposite of public radio.
    The problem is that you have been so many things and proposed so many things over the last year that nobody knows what you are and what you stand for.
    I know all too well the problems in the industry right now, and I appreciate that you are trying to work this out in a transparent manner. At this moment, however, we are getting a peek into the sausage factory and it’s not pretty.
    I mean it when I say good luck. Nobody else has found a way to make this pay at this level, and sites are collapsing everywhere. I’m amazed that you’ve lasted as long as you have and people need to appreciate how much work you have put in this. I disagree with you a lot of the time, but I admire your sheer determination. I have to admit that when we move, I’ll still check back from time to time. It has been ‘interesting’ as you say in Minnesota.

  2. Just to clarify once again, the newspaper advisory board is just a reader focus group that meets about six times a year for an hour or so to look at front pages tacked to the wall and give feedback on layouts and photos and stories. We don’t discuss ads or finances or advertorial policy. Other than John and I, who are friends, we don’t talk between meetings and I couldn’t even name everyone in the group. You’re making way too much of this supposed secret connection.
    I have more understanding and appreciation for the News because I have been in the business for a long time. That doesn’t mean I agree with everything they do, but I’m not as critical and mean-spirited as some people here are. I guess the civility rule doesn’t apply to trashing the newspaper.
    I am very clear to note in my comments that I am not speaking for the News and to note when I have no direct knowledge of their policies on certain issues.

  3. I am a member of the Northfield News Reader Advisory Panel.

    In the time I have been a member, we have discussed news stories and coverage, but I am unaware of how much “advice” was actually taken to heart and implemented.

    It has always been clear to me that the Chamber page was clearly “not normal” because of its layout, banner, typeface, and the fact that there are no other ads on the page other than Chamber members.

    I am all for advertisements on Locally Grown. It pays the hosting and other costs.

    I just struggle with the Advertorials on LGN. I just hope that you continue to make them look slightly different and don’t end up making the content on LGN more paid content, and less of what the site is now.

    It takes a balance I guess. I think there are lots of interesting stories in Northfield, and I would hope that a person would not have to pay to get it out there. Non-profits, The Arts Guild, Just Foood, etc. They need the coverage, and there advertising budgets are minimal.

    Another for instance… if a new business is coming to town. Would you cover it, or request a payment for a piece regarding the business? Where is the line between news coverage and the advertorial drawn?

    If Locally Grown wants to start a Locally Grown Northfield Reader Advisory Panel, I would be happy to participate in it as well.

    My opinions are free. Just let me know where and when… 😎

  4. John and Anne,

    from my perspective the chamber page is not clearly advetorial. different font, seriously? Is there a guide somewhere I could compare fonts to know what is an ad and what is not? I’m being silly to illustrate a point, it might be clear to you, it was not clear to me until recently. Is the business spotlight in a different font? I’m not trying to be critical of the News, I don’t have a problem with it. I think the difference is Griff is discussing the policy openly and accepting feedback. most other media outlets don’t.

    Turn this whole scenario around and think about it from a business perspective. this is locally grown Northfield. Griff is offering an opportunity for local businesses to reach new customers. think about how Just Food could benefit from that. I welcome the chance. I have always argued that I can compete with the big boys, but I do not have $80 million to tell everyone. I need to be selective and I need results. talking with other business owners, we are always looking for advertising that works. I think this is a chance to help some local businesses reach new customers.

    If it’s a banner ad that links to my blog or website or an advetorial, I don’t really care. right now I feel like I’m throwing spaghetti at a wall to see what sticks.

  5. I do not have any problem with Griff providing a low cost advertising model. Hopefully, that will benefit the both of you.

    I just hope that we do not see advertorials take over the site, and non-paying, interesting items decline and wither because of it.

    I am going to withdrawal my opinion, and objection, as I feel Griff is just going to do what he feels he needs to do anyway.

  6. Jerry, if you read my comments again, you’ll see that I agree that lay people might be confused about the advertorial in the News. They should be more clear. As I said, I don’t read the print edition, so it’s not an issue for me. I’m just talking about common practice online.
    Look, there are tons of gray areas…if Sam Gett is in Rotary and really believes in the value of the Turkey Trot race, he will write a column where he might not write about another group or event that doesn’t involve him.
    The story won’t make front page unless the editorial staff really believes it has merit. Judging merit can be tough in a small town…when the people making the decisions are involved in so much. Add in the subtle pressure to keep advertisers happy and you have a real minefield.
    I’m glad Griff is having the discussion. I have been through many of these and none of them are easy or pretty. I ran a small, financially struggling publication and I quit a good paying job at another one over just this kind of ethical controversy, so I’ve thought this through more than you know.
    I’m just noting that the options Griff is considering raise a whole new set of problems as well as new opportunities.
    There are no good or easy answers.

  7. Don’t know whether this is under advertising or ethics, but just pointing out the discussion about ManZone, where people involved are carrying the discussion. Is that a reader discussion or a promotion?
    There have been some posts about Beef O’Brady that have been uncomfortably promotional.
    All of these issues are in that gray area between civic engagement and business promotion. Happens all the time, but what happens when supporters of a business flood the comments for an advertorial, dominating the comment field? Will readers interested in policy/government discussions be willing to wade through the promotions to get to comments they want to read, or will they give up…
    I don’t know the answer and I think ManZone and Beef O’Brady are just dandy. I’m just pointing out examples to raise the question.

  8. The feedback on this topic has been great, and is helping Griff (and me) clarify where we each want to go with LoGro.

    One of the things I love about Northfield is that it’s full of quirky people who are involved in a lot of interesting things, both business-wise and as volunteers. I’d love to know more about Duys & Nicholson who build large pipe organs here in Northfield, or David Folland the violin maker, or any of the other artsy niche businesses here. One of my many gripes about the Northfield News over the past few years is that generally won’t run press releases from such businesses because they want the companies to buy ad space. As a result, people in the community are deprived of interesting and potentially relevant information simply because these particular businesses don’t advertise in the Northfield News. And in many cases, the businesses’ markets are not local, so it wouldn’t make sense for them to advertise here.

    I personally don’t EVER want LoGro to take that stance; I want to retain my right to write about anything I find interesting, regardless of whether someone has purchased an ad or bought an advertorial or whatever. Yes, our coverage may seem capricious, because it is. LoGroNo has the flavor it does because Griff, Ross, and I each have different interests and tend to follow those in doing our posts.

    The only way to guarantee representation on LoGro is to buy space. I don’t have any problem with that.

  9. BTW, Huffington Post has a graceful way of adding advertorial copy in the left column, clearly marked amid the usual blog posts, but not in the news posts. That could be an answer…

  10. And on your last post, Miss Davis, I completely agree. 😎

    I have talked to several small business folks that I patronize, and frankly, they feel that for the price, there are better mechanisms in Northfield to advertise with than the News.

    There is really no competition, so you either pay the price with the news, or do without.

    I hope your banner ad model gets up and running soon. I know several folks that are interested. They do not have a ton of $$ to spend, but want to get their business out there.

    Will you folks have some addtional banner ad design specs (other than height/width) soon, so that we can start designing them? Do you have a file size restriction? Can we do animated banners? etc, etc.

    Also, I think a set price is going to work out better than bidding. These folks want stability, and known fixed costs.

    Also, would you folks consider bartering as a method of payment, such as a transfer of services of equal cost, or product in trade for the advertisement? Bartering is a great tool in this economy, and is easier to do for some businesses.

    Just curious.

  11. John,

    I agree. I’ve tried the News and didn’t have great success. I think it works for many businesses, just not mine. I’ve tried a number of advertising methods, now I’d like to try LGN.

    I definitely like barter.(insert smiley guy here)

  12. Norman, thanks for the nudge. I’ve been a slug on the LG ad plan for the last week while I tried to make money the old fashioned way… by the hour!

    I still want to keep noodling on both the auction idea and the advertorial idea but in the meantime, I think it’ll be best to get smarter with a traditional offering of both banner ads and text ads. I’ve purchased some software to help manage it and am starting to learn to use it now. I’ll try to deploy it just as soon as I can… hopefully within a week.

  13. Here’s a screenshot of the first draft of the ad types, sizes, and rates that we plan to make available. You can actually now get to the ordering page by clicking on any of the demo banner ads, or just go here. I’ve not enabled the PayPal payment system yet but everything else appears to be working. Go ahead and test it! I’ll delete your order.

    lg-ad-types-sizes-rates-draft1

    I’m looking for feedback on our overall offering of ad types, sizes, and rates.

    You can see we’ve added a three new placements:

    • left sidebar descriptive text ad links for non-profits. You get 50 characters to describe your link
    • small left sidebar banner ad 155×155 for non-profits (used to be large vertical 160×600)
    • medium banner ad 435×60 at the bottom of every blog post (see it above)

    Apologies for taking so long to get this rolling. I blame my pesky clients. 😉

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