Page 157 - Electronic Commerce

Chapter 3

distribution. Newspapers and other publishers worry about these sales losses because they
are very difficult to measure.
Many publishers continue to experiment with various other ways of generating
revenue from their Web sites. There is no consensus among media industry analysts
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regarding whether a pure advertising-supported revenue strategy can work for newspapers
or magazines in the long run.
One mixed revenue model for newspapers provides some content at no cost but
charges a fee for other content. Newspapers (and other Web sites that offer valuable
content) can allow visitors to access a limited number of items for free each month and
then charge a fee for continued access. This approach, where free content is available up
to a point at which fees begin, is called a paywall (that is, a visitor can access free content
until hitting a wall, and then must pay to pass over that wall). You will learn more about
the technologies, such as Tinypass, that are used to create paywalls in Chapter 11. An
increasing number of newspaper and other content-providing Web sites are experimenting
with various combinations of mixed advertising, subscription, and fee-for-content revenue
models, and this experimentation will likely continue into the foreseeable future.

Advertising-Supported Online Classified Ad Sites
In the past, newspapers generated a significant percentage of their revenue from their
classified advertising pages. You have already learned that targeted advertising can
command higher rates than general advertising. Newspaper classified advertising was the
original version of targeted advertising. Each ad is placed in a specific classification and
only readers interested in that type of ad will read that classification. For example, a
person looking for an apartment to rent would look in the Rentals classification. The
growth of classified advertising Web sites has been very bad for newspapers. Sites such as
craigslist now carry many free classified ads that would once have produced substantial
classified advertising revenue for local newspapers. Craigslist and similar sites run most
ads for free, only charging for a small proportion of the ads they carry (craigslist charges
for job ads, brokered rental ads in New York City, and a few other categories). Craigslist
generates enough revenue to continue operating, but many other classified advertising
sites generate substantial revenue, replacing newspapers’ historical role as the primary
carrier of classified ads.
The most successful targeted classified advertising category has been Web
employment sites. Companies such as CareerBuilder.com offer international distribution of
employment ads. These sites offer advertisers access to targeted markets. When a visitor
specifies an interest in, for example, engineering jobs in Dallas, the results page can
include a targeted ad for which an advertiser will pay more because it is directed at a
specific market segment. Other employment ad sites, such as The Ladders, charge both
job seekers and employers for ads and access to those ads.
Employment ad sites such as Monster.com also target specific categories of job seekers
by including short articles on topics of interest. These articles increase the site’s
stickiness and attract people who are not necessarily looking for a job. This is a good
tactic because people who are not looking for a job are often the candidates most highly
sought by employers.

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