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However, CPC advertising continues to be effective even in niches which share relatively little overlap with the profile of the typical ad-clicker. I get five to one return on a product which is sold overwhelmingly to female college graduates, despite being adjacent a niche (and sharing keywords and advertising partners) where the typical ad-clicker is strongly represented. Why would this continue to be the case?
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The problem is that ANY blog that is saleable is not representative of all blogs or even all blogs which were built to sell. 100% of McDonalds burger flippers make at or above the minimum wage. Blogs which generate so much as a single penny of income are the exception, not the rule. Blogs which sell for thousands are the exception to the exception!
Plus, the blog at issue made LESS than the minimum wage if that person fills out his taxes honestly. It is a short term capital gain, which means it gets hit at his marginal rate, with none of the favorable tax treatment available to wages. If he decides to put it on Schedule C, which I think is dubious but I could perhaps see a reason for doing it (it arguably makes the gain earned income, which can be advantageous in some circumstances), he'll lose about 15% off the top to social security tax (McDonalds workers pay half, then McDonalds silently pays the other half for them), THEN get to pay taxes at his marginal rate on whatever is left.
I have a vested interest in "Ecommerce", since I sell software over the Internet. I think plenty of folks who try to monetize websites with advertising might want to try selling something of value instead.
I'd have to make $80 CPM to equal the profits from my software business, and this is in a niche with a typical CPM value of about 90 cents to $2. (I should know, I pay lots of other sites that much to send me their visitors so I can make $80 CPM off them.)
I recently opened up a free webapp in the same vertical. My friends asked "So, when are you going to put AdSense on it to make money off that sucker?" I think the day after "never" -- I'm going to cut out the middleman and use the free site to drive visitors to the site selling the software. Then I get oodles more than the going rate for AdSense clicks (~8 cents each in my vertical) and I don't have to share any of it with Google. (When I pay some publisher ~8 cents to plug my product they only see ~4-5 cents of it. The rest inflates Google's bottom line.)
"How to take a $100 investment to a $500 payoff using 2 months of part-time specialized labor which you got for free" doesn't have quite the same ring to it...
I would have found the claim much more credible had it been phrased that way. That is a useful skill to learn, especially for beginners. As fun as it is to point to the high schooler from a broken home who makes 7 figures from MySpace templates, I think it is more important that folks be told you can with much higher probability make $10k a year from making something which people in an underserved vertical will buy, and then proceeding to sell it to them.
That article isn't going to get Spinned or Dugg, sadly.
Similarly, for those of a domainer bent, you could automate things to the point where you spend $10,000 on 100 niche domains, spend two months writing or commissioning content and ranking them all, and then monetize the best and sell the rest. Seems like a whole lot of work to me relative to polishing one apple but, hey, the Internet supports all types.
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Story: Who Really Clicks on Ads?