Does Nuffnang make sense (cents)?

Nuffnang is a local blog community portal that serves as an advertising platform for bloggers like myself to monetize my blog through their fuss free CPM/CPC models. To date, they have over "40,000 bloggers" signed up from Singapore and Malaysia. This number is commendable and i must applaud their initiative in giving bloggers an avenue to make some form of revenue otherwise unseen. If you are not familiar with their model, read this first.

In summary, you can either earn through signing up for global cpc ads which pays upon click through. Or if you qualify to sit in their CPM band, you can be targetted to earn based on the number of ads you serve on your site. Most of you are probably using Nuffnang as i write as it really is the dominant ad serving network for local bloggers like myself.

But, how robust is this engine? And are the pricing/qualifying metrics correct? I will approach this from 2 points of view, the advertiser and the blogger. Let's look at the blogger's scenario first.

Based on the CPC method ( since you have no entry control over the CPM method), you have no idea what the actual COST per click is until your cheque comes in the mail. This is an issue of transparency which is debatable as Nuffnang can choose not to disclose how much of the click they are earning from. But shouldn't we get to decide if the value of the click is worthy of the inventory we have?

For example, assuming advertiser A is paying 20 cents a click. Nuffnang may take 10 cents and pay you 10 cents per click. So if you know its 10 cents per click, you can decide if this is a worthwhile ad campaign to be a part of. Of course discretion is key but as with all ad networks, pricing should not be a 1 way process that is decided by advertiser and agency. Bloggers need to start thinking about the worth of their inventory space.

This brings me to my next point of inventory maximization, going back to my earlier example of Advertiser A's 10 cent per click campaign, assuming you have an excellent CTR based on this particular ad, (perhaps the ad speaks very strongly to your blog audience). Shouldn't you be rewarded with more ads thus giving you the opportunity to make more $$? This makes sense for Nuffnang and for you.

Random global ads serve as a very good measure of finding out whose blog is the most efficient use of the ad distribution, but then once Nuffnang susses out who's doing a good job based on ctr, then it makes more sense to serve this blogger more of the same. I'm not sure if Nuffnang already has this algorithm in place, if not, it's something to think about. Nuffnang will stand to gain as well as serving more effective CPC ads means they get to report better CTR to the advertisers.

Now, lets examine the nuffnang CPM method. I would like to suggest that evaluating a blog by unique visitors alone is an extremely crude way of determining a blog's relevance to a CPM campaign. CPM campaigns are mostly used for branding which is why eyeball traffic is the primary qualifier Nuffnang is using. However, from an advertiser's point of view, serving my branding ad to a site based on purely similar content and unique visitors is like standing in the middle of a crowded street shouting out to every passerby. Presence is NOT recognition.
Nuffnang needs to define their blogger bands much better. I suggest these inclusions

1) The number of people subscribed to this blog. This is an indication of audience loyalty. If i get 2000 unique visitors but these are all wayfarers, then the potential retention of the brand message isn't as high. If however, 500 of this 2000 come regularly then this tells the advertiser there is more engagement and involvement happening with this blog's audience.

2) Participation. This is also linked to point 1 but it can be measured by activity on the site such as comments, ratings, widget interaction. The interactive value of each eyeball is just as important as the number.

Also, back to pricing, if i were a blogger who qualified for a CPM band, i would certainly want to know what the price per ad unit is.

Lastly, i would like to say again that i think Nuffnang has done a good job so far and many bloggers have received money they would never have seen otherwise. However, like most things, it's always healthy to have the light shined on areas that can be improved and i hope my article has shed some illumination on this. Comments are welcome especially if i have made any factual errors on Nuffnang's operations.