Adgitize, promoted as "world class advertising on a blogger' budget, is closing shop.

Ken Brown, Adgitize founder and Admin, has sent e-mails to all members and posted on the Adgitize site on December 27, 2011, saying that " Adgitize tried to fill a niche market but the costs to run the business were more than the revenues generated." 

Adgitize is now winding up its operations and will officially close on January 31, 2012. 

Having run CMF Ads for several years, I understand how tough it is to run a widget advertising network - especially in the current economic climate.

The main issue is that there can be a big difference between what the ads cost and what advertisers are prepared to pay. I'm not an expert on the housing market, but I believe a similar thing has been happening there for few years. Sellers ask a high price, buyers can't afford it. Result: hardly anyone is buying and selling houses.

I've tried to get into BuySellAds, but my blogs do not get enough traffic. They say you need an average of 50k impressions per month, which must be a recent requirement as they have blogs that only have 10k impressions. Their directory is interesting - I found lots of blogs with 10k impressions who charge $10, $20 or $30 for a 30 day ad - but every page or two contains one blog with similar traffic who thinks they can get $500 for a 30 day ad. The problem certainly doesn't affect the majority of blogs I looked at, but at CMF Ads I noticed a lot of small blogs had a tendency to overvalue their ad space.

I think there are many bloggers out there, but few advertise to promote their blogs. In my observation, many bloggers want to become publishers and put some ads to generate income, without even looking at their traffic and promoting their blogs to get generate traffic to add value to their blogs.

For example, in the Adgitize, as of today, December 28, 2011, there are 10,000 publisher-members. Yet, of these 10,000 bloggers, only 100 (yes, 100) advertise their blogs in the network. At US $14 for a 31-day ad, total revenue is marginal for 100 advertisers. No wonder Adgitize could not generate enough revenue to pay for its cost of operations.

So right now, 1% of Adgitize publishers are also advertisers. That's not a great figure.

I think people were more likely to advertise at CMF Ads because you could pick and choose the ads you wanted to place. There were network ads too, but you could advertise for quite a small amount of money. Adgitize didn't have as many options so you had to pay for a full network ad.

But even if Adgitize had allowed individual ads, once the novelty had worn off, I doubt it would have improved the situation all that much. Look at how much we did at CMF Ads - maybe we changed too much. I enjoyed building new features and seeing how people used them. Even with a fairly regular flow of new ways to advertise and earn money, the network went downhill in 2011. I think the features we added slowed down the decline - it would have been a very fast decline otherwise.

I'm always sad seeing businesses like Adgitize and CMF Ads fold-up. I wish I could do something to save them. Having been a salesman in my younger years, I feel market promotions could help. Diversified products and services could help but they should be marketed right.

Before the announcement of Adgitize closing, I had the last post in its forum where I reiterated my request that clicks on images of advertised blogs be made to register on traffic monitors as a visit coming from the site where the ad is placed (this was how CMF Fireworks worked). I did not get a positive reply on this. If done, I believe the feature would make a good acceptance from blog advertisers. Adgitize already had a good business model, it needed the numbers and this feature might have given them.

I tried Adgitize briefly when it first started, but never really go into it so it didn't take long for me to take the widget/ads off my blog.  With CMF Ads, I there from pretty much the beginning, and stayed until the end, but I don't think I really took full advantage of the ad program.

It seems most of the blogs that do use such ad networks are those just starting out, or blogs with very little traffic. Usually the blog owners of such blogs don't have a huge budget to spend on advertising, so they try using the networks that are not expensive. Unfortunately, as with the case with Adgitize, very few will become regular advertisers, and prefer to just sit and earn money instead of investing it back into the system.

I am currently using BuySellAds and have been having some success with the program. The trick, which Ben talked about, is determining the actual value of the ad space on your blog. While having a blog with a few thousand pageviews a month, and dreaming of selling an ad slot for $500 seems great, that will only be a dream. Having a much lower value - like $10 - may lead to some advertisers buy the ad slots.

I usually look at what the blogs with similar pageviews as mine are selling their space for and usually stay around the same amount.

@TechieGuy - I did a quick search for your site at BuySellAds - I see you have around 105k impressions. That's pretty decent. Many of the sites I saw with 10k impressions (so 10% of your traffic) were charging the same as you do now - so no wonder your ad slots are currently sold out.

Of course, it's not just about traffic - it's also about whether the site is any good. Yours is clearly very focused and would attract a large and growing amount of search traffic. I think this is the area where so many small blogs miss out - partly due to a lack of focus, a lack of targeting any keywords whatsoever, and the fact that so many blogs get abandoned within the first few months.

I sometimes wish I had the attention span and knowledge to cover a topic in sufficient detail that I could run a blog on that topic for years. The closest I've come is with Quick Blog Tips, which is my fourth attempt at a "blog about blogging". In my view it's above average, but it's tough to attract readers when there are already so many similar blogs.

It's not easy to sell advertising on a blog in a saturated niche, or if it doesn't offer anything new to readers that competing sites don't also offer. QBT falls squarely in the "saturated niche" category. Metablogging sees a lot of blogs coming and going and few true leaders beyond the obvious A-listers, and I think some readers simply write off the whole niche because it's been done to death. On the plus side, catering to beginners means there is always a new audience to write for.

At the risk of alienating just about everyone (no offense intended though), I'm going to weigh in on this.

While I do whole heartedly agree that many blog owners set complete absurd and ridicous prices, I believe there is a bigger issue involved that pertains to most, if not all, advertising companies - model viability.  The advertising market is a viscious and brutal one.  I've worked more then ten years in this area and it hasn't gotten any easier.  I know the different advertising business models very well and they all share the same basic flaw.

Advertising companies often suffer from lack of sales, overgrowth or, in most cases, both.  The most difficult issue of getting any advertising company up and running.  Most advertising model deployed today involve some type of traffic exchange.  Very few advertising companies are just pure advertising any more.  This is where the mistake comes in - The traditional advertising business model fails horribly with any type of traffic exchange or traffic generating methodology.

Traffic exchanges actually require a distinctly different approach to make them successful.  While many people try their dsamnedest to pair traffic exchange/generators and advertising, which is what Adgitize did, it will not work... ever.  Either the business is a traffic exchange or an advertiser, but it can NOT be both at once.  It is simply not sustainable at any level.  The business models are very different and in a factual analysis, completely opposite to each other.  Unless you've ran both as I have, that last statement may not make any sense, but its a harsh reality.

Advertising companies ALWAYS require a VERY LARGE INITIAL CAPITAL INVESTMENT to advertise their presence and get advertisers while traffic exchanges often grow by word of mouth and simplier advertising method.  The most important advantage for any traffic exchange is that is can sell ads and feed off the revenue to grow.  Advertising companies do NOT have this advantage as its a bit of an oxymoron for an advertising company to sell 3rd party ads to pay for their own ads.

I personally believe Adgitize tried to use a traffic exchange business model to start an advertising company thinking he could sell the ad space and feed on the revenue to grow.  It failed because the advertising model REQUIRES the large capital investmet to grow.  Adgitize grew to fast, but it didn't have the capital reserves to sustain the growth.

Mar said: "I personally believe Adgitize tried to use a traffic exchange business model to start an advertising company thinking he could sell the ad space and feed on the revenue to grow.  It failed because the advertising model REQUIRES the large capital investmet to grow.  Adgitize grew to fast, but it didn't have the capital reserves to sustain the growth."

 Well, the observation may be correct. However, Adgitize's problem seems to be that it grew too fast in terms of having 10,000 publishers in a span of 3 years, but it failed to attract the many publishers to become advertisers.

So, when it announced that it was closing shop on December 27, 2011, it had only a total of 100 advertisers. Therefore, there were many bloggers publishing the ads of 100 advertisers. Then, Adgitize had to use about 60% of its revenue to pay off the publishers, leaving a small revenue to sustain its operations. The business model turned out to be not financially viable in the long run, resulting to its operating at a loss.

In my case, I personally believe that a blog advertising network without traffic exchange would fail to entice bloggers to patronize such set-up. Blogs need traffic from any source and bloggers would only engage in activities that would increase visits to their sites. The reason why Entrecard is still having active members is the traffic that a blog gets and for free at that. LinkReferral is another surviving blog ad network that results to visits to blog members without costing them anything. Adgitize was patronized by many loyal members for the same reason, a guaranteed daily visits from among its members.

I further believe that had Adgitize been more dynamic in its service offerings, it would still be operating now. The stringent requirement of having a daily post by an advertiser is too much for most bloggers. Adgititize should have offered another alternative to offset such requirement that guarantees the reabate of advertising fees. Earlier, it should have looked for ways to get non-blog advertisers into the network.

As it is now, the pure blog advertising network has the earning potential of members tilted in favor of high-traffic blogs. Those with less traffic earn nothing and don't get any visitor be it by way of exchange or advettising their sites. Advertising blogs in such network doesn't guarantee visits. Impressions they get but visits are nothing but minimal. Many active Filipino bloggers numbering in hundreds are now using Facebook pages for their traffic exchanges. It's free and members get visits to their blogs as well as comments on compulsary basis.

EdZee said "I personally believe that a blog advertising network without traffic exchange would fail to entice bloggers to patronize such set-up"

Project Wonderful seems to go from strength to strength and doesn't have the traffic exchange element.

"The stringent requirement of having a daily post by an advertiser is too much for most bloggers"

Agreed. If there's one thing I dislike about Adgitize it's the daily post points.  They've caused some otherwise decent bloggers to post utter junk just to reclaim a few cents.

@Eli

I agree, Adgitize over incentivized,  When they first started, they did well...  When they started going in all sorts of weird directions, Adgitize started going south.  Also, IMHO, when Ken first started, his picture was that of an everyday "joe", which gave the community a simple, yet, a "welcome home" feel to it.  Once he donned the suit and attitude, Adgitize lost what it was all about.

@EdZee

AFTR is a traffic sharing system, not an advertiser, yet it does well.  AFTR is the opposite of ProjectWonderful as @John notes above.

I also agree with the insane requirements.  That's one of the many issues that just turned me off. 

I disagree with you on the non-blog advertisers.  I personally think mixxing blogs and non-blogs is not viable due to content freshness issues of the non-blogs.  EntreCard went down this road...  It was a disaster that lead to, one of the many, a mass exodus of its members.  While there are ways to mix blog and non-blog content, Adgitize was not set up or geared towards such abilities. 

There is one issue that I didn't note above - a Google slapdown.  I have checked several blogs that were in Adgitizze and have noticed that many of them have disappeared from Google's listings.  I now believe it is very plausible that Adgitize was slapped down, like EntreCard, by Google and the loss of page rank and/or a search listing has had a rather severe effect on Adgitize.

Advertising profit always favor high traffic sites.  That's just the metrics of the game as the price must be *relatively* comparable to the market standard, 1 penny per 1000 impressions.

Sites like Adgitize, and Entrecard for that matter, don't last long, mainly because of the what those sites attract. Most sites/blogs that sign up for those sites are those that have little traffic to start with. Unfortunately, with such little traffic they also have little budgets, which won't help Adgitize survive. The fact that very few of the publishers that use Adgitize were also advertisers proves this. Also, those that do advertise are advertising on blogs that get very little traffic to begin with, so they really aren't improving their chances of increasing their traffic.

Larger blogs use other opportunities for selling advertising, so they won't even look at Adgitize. When Entrecard first started, I believe larger blog owners were paid to join the program and then quickly left when the agreed to time was over.

When I first started blogging I used Entrecard and tried Adgitize. As my blog grew I realized there were other, and better opportunities for generating both traffic and income.