Jeff Jarvis: Still Deluded
Does Jeff Jarvis still blog? Do people still actually read what he says?
Apparently yes. And apparently with no more insight than he used to. This time with rose colored glasses over a powerpoint slide Glam Networks is shopping around. Glam are an ad network for women. They own hardly any of the sites in the network.
And this fact (that they pay the majority of their revenue to their partners) is what makes them better than iVillage! “iVillage is built in the Yahoo model of sites it owns or controls; it tries to lure people in and then bombards them with ads.”
Luring! Bombarding! Ads!
More on iVillage: “iVillage was our deadly competitor when I worked at CondeNet and we often sniped that much of its traffic was junk. This illustrates that: The largest circle inside iVillage is astrology traffic and the dark circle in that represents people who come to iVillage for horoscopes and nothing else. That may bulk up your traffic numbers, but it’s not saleable to advertisers.”
Astrology! How low value! I mean, not as low value as a social networking site that makes up more than half of Glam’s usage. Oh no, advertisers are lining up to pay $30 CPMs on that.
And you know, Glam aren’t really an ad network: “Glam is really a platform. That’s the key.”
WAKE UP AND SMELL THE COFEE MRS BUELLER, THEY ARE AN AD NETWORK!
They are an ad network who pays out 80% of their revenue to partners. As those partners get bigger so to will their negotiating power and revenue share. To the point where it makes sense for them to leave the Glam ad network and just sell the inventory themselves. Success begets failure.
p.s. This for me was the clincher. There is delusion and then there are lies. “Glam exploded by being a network. It asked the question, WWGD? What would Google do? Google, by the way, earns about 30 percent of its revenue through its O&O properties, Arora said.”
Ahh what earnings releases has he being looking at? Firstly, reverse that statement on a revenue standpoint. And on a profit (that’s what earnings are) basis, about 93% of Google’s quarterly profit is owned and operated and 7% from partners (that’s what happens when you have to pay 80% of every affiliate dollar).
p.p.s Mike Arrington restores some sanity but suggests that Glam’s huge round ended up closing and they achieved the $450m valuation they were seeking with just the $11m in gross revenue they were forecasting for this year.
“The largest circle inside iVillage is astrology traffic and the dark circle in that represents people who come to iVillage for horoscopes and nothing else. That may bulk up your traffic numbers, but it’s not saleable to advertisers.””
–This is hilarious. Astrology traffic actually performs quite well for a number of direct response and pseudo-direct-response advertisers, and is one of the better categories of content in this regard. As opposed to social networking, which as you mention, is hard to sell for decent rates. The astrology-related traffic is likely to net 5x as much or so!
[…] is worth two in your network. Or maybe ten. Anyhow, I’m enjoying Niki’s criticism of Jeff Jarvis on Glam. Not saying an ad network isn’t a fine business, especially if […]