How do they make money - Blogads

AdSense have been the number one choice for bloggers, but what about Blogads ?

Pulling together two of the world's most powerful communications tools -- ads and blogs -- blogads is a unique vehicle for promoting your dragon-headed dreams

Blogads.com is a network of influential bloggers who collaborate to promote and sell blog advertising.

And the sales pitch is

Rewarding. The average blogger makes $50 a month selling Blogads, with some pulling up to more than $5000 monthly. As advertiser appreciation rises, your yield should rise. Blogads receives just 20% of your ad fee, unlike other networks that charge far more or won't even tell what they take.

An advertiser wishing to sign up for Blogads, gets a list of available sites for whatever topic is chosen, say "travel". Blogads offers ad rates tied to its clients' Internet traffic - the more visitors, the higher the rate for an ad on that site. Some sites will run multiple ads, but most on the list appeared to get either no ads or one.

They sell the space of approximately 500 predominantly US-based weblogs. "It's a wonderful self-feeding furnace," Copeland says. "We're now getting 100 million page impressions per month." That's within "spitting distance" of some of the bigger news sites, such as The New York Times at 400 million impressions, he says.

Problem is 30 million of Blogads' impressions are with Daily Kos which apparently earns $600,000 a year from Blogads, 14 million are with TuckerMax.com, 14 million are with Instapundit.com (earns $300,000 a year) and 40 million with the next 10 largest blogs. In other words very little traffic or money dribbles down to the small blogger.

My conclusion is that if the "average blogger" is putting out 1000 impressions a day, then they can earn $200 a year from Blogads, depending on the niche they are in (and a big if, is that they actually have to have advertisers sign for their site). But basically Blogads is not for the average blogger, Blogads make their money from their larger clients, 80/20 rule in action. The small ones are there to give either credibility or added profit from the "long tail" that nobody can afford to ignore.

Blog ads income from the "average" blogger would only be $50 a year on that basis. They would have to have a lot of these average guys to make any real money from the tail. Unless they can attract 10,000 of them, then there is no real profit for Blogads - but if they did attract 10,000 bloggers, then how would the poor advertiser decide if and where to place their ads.

The income seems to be roughly linear, so if you get 5000 impressions a day, you might expect $1000 a year. You can make so much more from AdSense with a niche site, that its hardly worth the effort of signing up with Blogads, and having what may be garish ads over your blog.