In June last year there was a blaze of publicity surrounding Flossie.com, a female-centric masthead that brought together the ‘best of the best’ female focused websites. But the blaze has well and truly subsided, advertising reality has bitten and Flossie Media Group has now decided to turn its back on the display advertising model.
Chief executive Jenene Freer said in a release: "From January 2010 we will no longer be offering display advertising as part of our service and will be morphing our business to focus purely on one-to-one communication with our core product being focused on an automated and aggregated email service. This will include solus emails and newsletters – plus content syndication and integration into social media."
Since its inception last year, Freer says changes in the advertising market have meant the company was forced to review the entire portfolio of products and the way it operates in New Zealand and Australia.
Smaller networks are struggling to sustain revenue from display advertising because without owning eyeballs "it is difficult to negotiate the large scale deals that the portals are able to offer".
"We know we can deliver engaging one-on-one communication within the niche communities of our publishers. As a great example of how effective this communication channel can be, $1,000 spent on display would drive on average 100 clicks, whereas the equivalent spent on a newsletter would drive 600."
Flossie Media Group will also be moving its head office to Sydney and campaign management and product development will be conducted from there. A satellite sales team will operate in New Zealand from January 2010.
Matt O'Sullivan, director at Naked, thinks the move to a cost per action or affiliate model is a trend worth watching and expects more publishers with small numbers of loyal readers to follow suit.
But sites like Flossie need to be careful because there is a fine line between spamming and "advocate marketing".
"Readers expect a little bit more from them. That's why they've got that relationship," he says. Cross the line and it runs the risk of becoming a site where users are paid to be advertised to, like Hooha.
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