NONE: Re: ONLINE-ADS>> Low cpms mean death
Re: ONLINE-ADS>> Low cpms mean death
wilding (wilding_at_islandnet.com)
Thu, 8 Oct 1998 21:53:13 -0500 (CDT)
John Audette said:
>In well established, efficient markets (the stock market for
>example), value is established purely by that old Internet
>publisher bugaboo -- supply and demand. In less established,
>ineffcient markets (the Internet for example), value can
>*temporarily* be established by suppliers. However, as the
>market matures and becomes more efficient, the powerful
>forces of supply and demand will overwhelm all artificial
>efforts to control prices.
Hmm. Wouldn't it be reasonable to speculate that if CPMs
fall lower and lower, then quality content on publishers'
web sites will become too expensive to buy, and fewer, less
qualified people will come to your site to see your crappy
content and your value to advertisers will fall further.
And then - guess what - there'll suddenly be a *demand* for
quality content that will attract more qualified visitors
that will support higher CPMs.
The supply and demand argument works both ways.
The likes of Rob Frankel and Andy Borland are not dumb. If
they can weather the storm, I figure they'll be there at the
front of the line when the dross falls away and people say
yes to paying, one way or another, for quality content.
>It's all just Econ 101. Hubris or whistling as you walk past
>the graveyard will not change things in the long run. And in
>the long run isn't it better to build a business plan on
>market realities rather than on how we wish it could/would
>be?
And what market realties would they be?
Is only one business model viable on the net? I don't think
so. In the high streets of America does every retailer have
to follow the Wal-Mart model or be doomed to failure? No
alternatives? No niche markets? No top end stores,
specialty stores?
>Jaffer Ali and Leo Shiener are voices in the wilderness.
These guys are always worth listening to because they've
made their online businesses work and they've made the bucks
to prove it. But does that mean we should all follow their
model? No. And remember - a visonary on the internet is
someone who can see into the future for a whole three weeks,
compared to the two weeks the rest of us manage.
It's still wide open and there's a whole heap of unexplored
'market realities' for us all to explore.
In my modest opinion.
Nick
Nick Usborne
Direct Response Writer - Online
and Chief Forking Officer of
http://www.forkinthehead.com
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