Pricing Advertising Inventory On a Hyperlocal Blog

When my salesperson and I discussed how much to price the ad space on my hyperlocal blog, she blew me away.

She came up with a price of $450.00 a month for effectively a skyscraper banner (160x600).

I was blown away because I'm used to dealing with much smaller numbers from AdSense, Valueclick, Doubleclick, Burst Media, Chitika, et al.

That price actually includes other services, such as running an article about the advertiser, posting their specials and coupons on my Deals page, posting their events on my Events page, crossposting their content to our Facebook Page, among others.

We got that price from the rates of a local magazine that circulates in our area. They charged $900.00 for a 1/4 page ad, and their magazine prints once a month. We just figured on 50% of that, on a monthly basis.

If you're wondering how to price your ad space, start by finding out what the local magazines and newspapers are charging. Because when you talk to them about advertising, they're going to compare you to them. You might argue that online advertising is more dynamic, more interactive, more hip, or that your blog offers a more focused audience.

Hogwash.

Local businesses see you no differently than any other media outlet.

Albeit, they're going to be cautious about advertising through a blog, or advertising through something they're not used to. But nonetheless, they see you as an ad salesman, which is no different than the ad salesmen of magazines and newspapers.

What the magazines and newspapers don't offer are these other services I mentioned above, such as writing a sponsored article, posting their coupons, adding their events to your calendar, mentioning them on your Facebook Page, Twitter, and e-mail newsletter. You can offer these as freebies to throw in when they buy that banner.

Many of those freebies don't really cost you anything in real estate. That is, it's only the banner that remains fixed in place on your blog. Whereas a sponsored article, or a coupon you post, or an entry on your Events Calendar, all gets pushed down as new content gets added, and eventually falls into the archives. But the ad banner never gets pushed down.

So, you're actually selling the ad banner, and then adding on several freebies as a package deal.

I considered the 1/4 page ad in a magazine as being comparable to a 160x600 skyscraper ad on my blog. When you look at a blog's page, the skyscraper ad takes up similar space on the viewable area of your page as the 1/4 page ad in a magazine.

Duration Versus Impressions

In the Internet marketing world, we're used to pricing display advertising based on impressions (CPM). But the local fitness center, hair salon, dentist office, have no idea what impressions are. And even if you explained it to them, they still can't visualize what they're getting for their money.

They want to compare you to the magazine and newspaper.

That's how they determine if what you're offering at a lower price is worth the buy.

You have to price it by duration. So, we're selling a skyscraper ad at $450.00 to run one month. The freebies, such as the sponsored article, coupons, events, Facebook, etc, are things we provide them with during that month.

Moreover, local businesses also have difficulty understanding banner rotation. They get the concept, but they're trying to compare that to an ad in a magazine or newspaper.

You might say, "Well Steve, you can't really compare our awesome blog with a magazine, we're a lot more dynamic". Well the question that businesses keep asking us is, "All I want to know is that when someone visits your website, are they going to see my ad?"

Unfortunately, banner rotation doesn't guarantee that.

Hence, we have to sell fixed placements, and then stack banners on top of banners all the way down our page.

If you think vertical banners stacked on top of each other all the way down a page will look tacky, check out Altadena Blog, they seemed to have made it look fine.

The other thing is that AOL Patch, who may one day come into your town, seems to be selling ad banners in a rotation. They have yet to enter my town, so we're going around to all the local businesses here and trying to train them into believing that fixed banner placements is the norm, and hoping that we'll have made it more difficult for AOL Patch to get rooted.

Summary

Contact local newspapers and local magazines and ask for rate cards. If need be, tell them you're interested in advertising with them. They'll of course call you and e-mail you for several days, but you don't have to buy anything.

Price your inventory lower than theirs, but not way, way low. You still want to present your inventory as valuable.

Offer a service that local businesses can easily compare and visualize against magazines and newspapers. Price ad banners based on duration, not impression, and stay away from banner rotation.

Identify other services you can offer for free, such as Facebook postings, Tweets, your e-mail newsletter, events calendar, posting their coupons and specials, or even a sponsored article. Present these as bullet points on a piece of paper, and market it as a package deal.

Offer volume discounts if they're willing to buy six months, a year, two years, etc.

Oh, and one more thing. We found a local graphic artist willing to produce professional looking ad banners at a low cost, and inform businesses that if they can't produce their own "artwork", we'll be glad to do it for an extra fee.

Posted in: Advertising