Comments on: The Penny Gap – In-Depth http://www.darrenherman.com/2007/03/12/the-penny-gap-in-depth/ Marketing, Media, and Technology Conversations Wed, 8 Feb 2012 19:55:30 -0500 http://wordpress.org/?v=2.8.6 hourly 1 By: Pam Tournier http://www.darrenherman.com/2007/03/12/the-penny-gap-in-depth/comment-page-1/#comment-25017 Pam Tournier Wed, 02 Jan 2008 15:38:34 +0000 http://www.darrenherman.com/2007/03/12/the-penny-gap-in-depth/#comment-25017 Mike, glad to see the advertiser view represented. Advertisers want proof of engagement -- not just warm bodies. As the saying goes, The worth of a thing is the price it will bring. Show me who is engaged enough to pony up and I'll pay for those warm leads. Mike, glad to see the advertiser view represented. Advertisers want proof of engagement — not just warm bodies. As the saying goes, The worth of a thing is the price it will bring. Show me who is engaged enough to pony up and I’ll pay for those warm leads.

]]> By: Mike http://www.darrenherman.com/2007/03/12/the-penny-gap-in-depth/comment-page-1/#comment-1008 Mike Wed, 14 Mar 2007 03:49:08 +0000 http://www.darrenherman.com/2007/03/12/the-penny-gap-in-depth/#comment-1008 Darren, Here is my take on the First Penny Problem. It makes me nervous that the vast majority of Web 2.0 companies have a business model relying on ad revenue. The first reason is that according to valleywag (I think) Google, Yahoo, MSN and AOL own 92% of the ad revenue. That's tough competition. Also, I get asked to buy banner ads (I sell a unique digital media). The big problem is the company selling space hasn't solved the first penny problem. A site builds traffic by giving something away for free and then wants to sell that traffic? Who is willing to pay money to talk to people that only want free? Darren,

Here is my take on the First Penny Problem.

It makes me nervous that the vast majority of Web 2.0 companies have a business model relying on ad revenue. The first reason is that according to valleywag (I think) Google, Yahoo, MSN and AOL own 92% of the ad revenue. That’s tough competition.

Also, I get asked to buy banner ads (I sell a unique digital media). The big problem is the company selling space hasn’t solved the first penny problem. A site builds traffic by giving something away for free and then wants to sell that traffic?

Who is willing to pay money to talk to people that only want free?

]]> By: Matt http://www.darrenherman.com/2007/03/12/the-penny-gap-in-depth/comment-page-1/#comment-997 Matt Mon, 12 Mar 2007 17:04:28 +0000 http://www.darrenherman.com/2007/03/12/the-penny-gap-in-depth/#comment-997 Yes. It is definitely tough to get the same uptake from consumers when you charge- even if it's just a little. We'll have to see if that changes over time with more widespread adoption of micropayments and the like. Now on the SMB side, small business owners are much more willing to pay a reasonable monthly fee for a service or application that helps to make them more productive. We are seeing "a hundred flowers bloom" as it becomes easier for small startups to grow revenues through productivity & marketing tools (37signals, wufoo, shopify...). -Matt Yes. It is definitely tough to get the same uptake from consumers when you charge- even if it’s just a little. We’ll have to see if that changes over time with more widespread adoption of micropayments and the like.

Now on the SMB side, small business owners are much more willing to pay a reasonable monthly fee for a service or application that helps to make them more productive. We are seeing “a hundred flowers bloom” as it becomes easier for small startups to grow revenues through productivity & marketing tools (37signals, wufoo, shopify…).

-Matt

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