Michael Arrington of Tech Crunch reported that PayPerPost recently raised an additional $7 million in capital. This would presumably be a positive turn of events for Pay Per Post.
However, some comments following that post seem to predict a negative turn for Pay Per Post. In particular, Allen Stern of Center Networks expressed disappointment that Ted Murphy, the CEO of Pay Per Post, doesn’t seem interested in speaking with him, and offers this advice to Mr. Murphy:
I think PPP will be hurt by the fact that the majority of their bloggers are small and very small. Eventually the larger advertisers won’t want to advertise on a stay at home moms blog with 3 visitors (2 are family) a month.
Well, I’m not convinced the majority of bloggers working with Pay Per Post are stay at home moms posting at blogs with only 3 visitors a month. My knitting blog gets roughly 800 a day. But, since I don’t know the statistics, I won’t argue that point.
Instead, I ask this: Even if the majority of PPP blogs are low traffic, why would that be a problem for PPP?
There are lots of small advertisers with small budgets who would like to advertise on the web. They may prefer to pay less than huge enterprises; this limits their advertising campaigns to blogs with smaller audiences who don’t charge much to post a review.
PPP serves this group and can make money doing so. But serving this group doesn’t mean PPP can’t also serve larger advertisers.
To attract a mix of advertisers and make a profit, all PPP needs is enough medium and high traffic blogs to carry the higher paying spots and exclude the smaller blogs from taking those opportunities.
So, no, the larger advertisers won’t advertise on a blog with very low traffic. PPP doesn’t need to persuade them to do so. PPP can capture their business by funneling the higher paying ads to higher traffic blogs by using segmentation. PPP already has some reasonably high traffic posties; likely they will attract more. They will also retain their medium and lower traffic bloggers who will be happy to fill the needs of smaller advertisers.
My guess is that serving the full range of advertisers will benefit PPP’s bottom line.