Weblogs and Income

Weblogs and Income.

In a brand-new paper for the upcoming Blogtalk, Trevor Cook suggests that bloggers won't be able to make much money from their weblogs.

This seems plausible. Is it true?

• Industry analysts and specialist correspondents can clearly generate enough income to sustain a business.
  Writers who provide critical business intelligence can easily justify
  subscription fees of $500-$2000 per reader per year from the circle of
  insiders who absolutely need that information. This has been true for
  decades, and won't change; private weblogs simply provide a better and
  more timely vehicle than mimeographed newsletters. These businesses
  don't need a mass audience; they need a writer, an office, a lot of
  plane tickets and hotel rooms, and perhaps an assistant. Do the
  numbers; you can make money way out in the tail. Needed: 100-1000
  readers who really want the information you can get for them.
• Political columnists who can command even a modest following should be able to generate enough income to stay in the field.
  If you're a political reporter in the US and it's an election year, you
  want to go cover the New Hampshire Primary. Several weeks of motels, a
  rental car, lots of meals in diners and lots of drinks for your
  sources. A plane ticket. Two, three thousand bucks. You won't get rich.
  Neither did Ida Tarbell or Sinclair Lewis. Get some readers, get $25
  donations from them and $100 from your fans, and you'll be working,
  you'll be writing, you'll be heard — and you won't have to haggle over
  your expense reports. Needed: 1K-10K fellow travelers.
• Sports writers, food writers, and travel writers might be able to break into the field through weblog writing.
  It's not a sure thing, but it might work. The challenges here differ.
  Sportswriting is a shrinking field: there aren't many jobs, and there
  are plenty of gatekeepers. There are also plenty of readers: the
  decline in jobs stems from the decline of newspapers and the
  consolidation of publishing, not from anything intrinsic. I Travel
  writing is dominated by publisher-owned brands, and so getting beyond
  Barely Scraping By is a challenge. Food writing is in transition from
  “women's page” to something else. A combination of subscription, tie-in
  merchandising, and membership/affinity programs should be able to
  generate $5 or $10/year from each reader. Needed: 20K readers, a
  garret, and a calling.
• Viable, small businesses can (and often should) support a blogger,
  especially in a field where everyone needs to be able to write. One
  fundamental difficulty managing a small firm is that people are
  quantized and expensive. If you want to add staff, you usually have to
  add a whole person — and commit to that person for months or years.
  This means that small companies are either understaffed (and nobody has
  time to do anything) or overstaffed (and that usually means there's no
  money for equipment that everyone needs). A weblog can convert a a
  fraction of a person to cash, simply by attracting visitors and making
  them interested in your products. (If you don't need more visitors and
  more prospects, you don't need more money. Please send it to me, ok?)
  Every bit helps. Plus, it's great training, it helps build contacts in
  the industry, it's got upside. Needed: For a retail business, 10K
  visits/month ought to translate to about $15-30K/year gross margin,
  which can make that extra staff position a bit more palatable.

Notice, too, that this is a revenue stream that
clusters of small firms can mine much more efficiently than large
firms. A small operation can pick up $10K lying on the table, but the
overhead burden on a large company makes this a much more marginal
proposition.

• Artists need a blog. If you are (or want to be) a professional artist, you need a channel — a
  path that leads from you to your patrons. Galleries used to be the
  channel for painters and sculptors, publishers and agents were the
  channel for novelists. Just about every artist has some unsold stuff,
  so you can always use a better channel. At minimum, it's a place where
  your collectors and fans can see what you're doing now and dream about
  acquiring a new piece or perhaps giving one to their cousin or their
  alma mater. You never know. Needed: a vocation, a style, and a short
  list of people who want to know what you're making.

This isn't a comprehensive list. These are some models that can
clearly generate enough revenue to sustain themselves, given the
appropriate underlying capabilities.

If you want to be a business pundit, you've got to write well and schmooze well and travel lots.

Notice that I haven't even mentioned advertising revenue (which is,
in my experience, overrated by people who write about blogs and
underrated by bloggers themselves) or sponsorships or donations. And
none of these models require lots of traffic.

They key isn't to get a lot of readers. They key is to get the right readers. 
[Mark Bernstein]