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	Rex Ballard - Director of Electronic Distribution
	Standard & Poor's/McGraw-Hill
	Opinions expressed do not necessarily reflect
	the Management of the McGraw-Hill Companies.
	http://cnj.digex.net/~rballard


On Mon, 1 Jul 1996, Rosalind Resnick wrote:

> Find out in the July 1 issue of Interactive Publishing Alert!
> 
> While it may be premature to write the obituary yet, banner advertising on
> the Web is clearly in trouble. The reality is the vast majority of Web ad
> dollars are ending up in the pockets of a small group of big players,
> primarily search engines and directories.

> Like it or not, it's a buyer's
> market out there, and the chances of a small to mid-sized Web publisher
> floating his boat by selling banner ads are about as good as the neighborhood
> basketball star's odds of getting drafted by the NBA. Web publishers that
> don't draw the 230,000 visitors a day that ESPNET SportsZone does need to
> step back from the current click-versus-impression debate and recognize that
> they may not be able to sell much banner advertising at all.

Actually, the entire context of "Publishing" will be changing radically in
the next year or so.  First, we will be seeing more and more "independent
providers", ISPs who allow users to create content and have it hosted by
the ISP server.  Most are collecting $20-50/month for 10-50 megabytes of
storage.  In many cases the user can put up CGI scripts and get access to
his http server log files.  Most server now have the capability to run
multiple "virtual servers" on a single machine.  Writers, instead of
depending on the "publisher" to distribute his work, can have the work
published, and can limit or restrict access.  A proper combination of
useful content "teasers", combined with CGI protected content or links to
protected content can lead to a source of revenue.

Advertizers are more inclined to need credible content on related subject
matter.  This is partly to distinguish them from ponzi schemes and "send
$20 and learn how to make $1 Million" scams.

The role of the publisher becomes that of linking the editoral content
provided by writers with that of the advertizers.  The publisher's web
page would be a place that people turn to as "The Source" of information
on a particular topic.  This would include contents pages, headlines
pages, search engines, and content.

The advertiser's would pay to have their content, promotional content,
advertizing,... included in the linkage.  The writer's would submit
content to publishers who would pay them a modest royalty based on the
traffic encountered.

> Instead of
> trying to stand their ground and "just say no" to free trials, soft-dollar
> link exchanges, and clicks-only payment schemes, publishers need to pursue
> alternative advertising models capable of bringing in revenue today. 

The most important context is to remember that the advertizer actually
only cares how many sales he can close as a result of his advertizing.  If
the advertizer puts an ad into a print newspaper that has a circulation of
1 million and he gets 10 closes/week from those ads, and he puts up a web
page linked to "Great Places in New York" that produces 15 closes/week,
which is the greater value?

The goal of the publisher should be to become a "BookMark".  That is, a
place the qualified purchasing customer will return to when he is ready to
make the purchasing decision.  The purchase might be a dinner for two (I
used the Zagat's guide on the Web to get a great restaurant, and let them
know that's where I found them when I made the reservation (by phone,
unfortunately).  That day, that Web page led to at least 2 $100 dinners.
Or the purchase might be a $500,000 home in Northern New Jersey.

In some cases, the ability to make direct contact with highly qualified
customers has actually made the internet more powerful than print
advertizing.  TCP/IP eventually outsold Novell in terms of number of units
using the protocol.  In effect, $1 Billion/Year in print advertizing
couldn't compete with "usenet News" and Mosaic/Netscape.

People are turning to the web as a market research tool.  They can quickly
find out about products, and services.  They can compare a wide spectrum
of suppliers, products, and options.   Possibilities that might have been
overlooked are being considered as a result of getting feedback from users
and other industry experts.

> Rosalind Resnick
> Editor and Publisher
> Interactive Publishing Alert
> http://www.netcreations.com/ipa/
> 718-237-1624
> Subscriptions cost $395 for 24 twice-monthly issues delivered via email and
> the Web.

> +---------------------------------------------------------------------------+
> This message was posted to ONLINE-NEWS. http://www.planetarynews.com/o-n.html

	Rex Ballard
	http://www.cnj.digex.net/~rballard



From rballard@cnj.digex.net Mon Jul  8 10:34:44 1996
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