Not too long ago, I discussed the matter of tier and revenue. The main thrust of the piece was an attempt to point out why tier cuts, rather than being the magic bullet which will solve all of SL’s perceived woes, are actually likely to inflict a mortal wound.
As a part of that piece, I scratched the surface of other options open to LL for revenue generation – including the use of advertising. Now, to be fair, the idea wasn’t mine – it is something my dearest Lord of Dee, Ciaran Laval suggested in his blog (which, if not on your reading list, should be).
Indeed, outside of SL, the Lab have already dipped a toe into the use of web advertising as a potential source of revenue in launching dio – which is specifically geared towards revenue-through-ads.
Well, now it seems as though LL are taking Ciaran’s advice on board: advertising using Google AdSense / AdChoice is starting to filter into the SL webpages.
Again, Ciaran reported on this ahead of me, and a thread is up on the forums concerning the move – and the negativity is strong, sadly. The ads themselves comprise a banner at the top of some pages, together with a vertical ad space down the right side of a page. As such, they are not overly obtrusive, but they are noticeable.
I could have sworn I actually had an ad appear on my dashboard earlier, but I was scootling around so much, I’m not sure – and repeated clicks on my browser’s BACK button failed to turn up anything.
As mentioned above, the reactions on the forum thread haven’t been overly positive to this move – but it is hard to fault it. Advertising is a fact of life on the web, and if LL can use it to generate a modest additional flow of revenue to their coffers, then all power to them – it’s not as if we can’t avoid the ads if we so wish; there are plenty of browser plug-ins available for those wo don’t wish to see ads popping-up hither and thither.
Currently, the ads have yet to hit the SL Marketplace, which would appear to be an ideal target for advertising, given the volume of traffic it receives, providing the page layout can be tweaked sufficiently enough so that real world ads aren’t getting confused for SL product ads. As I mentioned back in January, when discussing tier, the Marketplace would potentially be the ideal spot for LL to try-out Ciaran’s idea for strategic partnerships with other companies.
It has been suggested that perhaps the system could be extended to provide in-world businesses the opportunity to use the advertising space as well. I’m actually not convinced this would actually work, for a number of reasons. Which is not to say it shouldn’t be tried, is the software would allow for it in a meaningful way (i.e. links to in-world stores and / or SLMP listings. Certainly, it wouldn’t be the first time LL had offered direct advertising opportunities to users, as those of us who remember the MOTD promotional “opportunity” from 2010. However, were LL able to walk a similar path again, I would hope they’d avoid trying to charge people between $1,500 and $4,500 USD, as they did with that offer …
Overall, there is no real harm in LL seeking to generate money in this way – and it really shouldn’t be taken to mean the company is in “dire straits” financially. It may not generate a significantly large amount of revenue when compared to land, but that doesn’t invalidate the move as a means of removing at least a further small portion of reliance on tier as the company’s sole means of revenue generation.
Inara Pey: Living in a Modemworld 
We’re not allowed to mention any competitor grid on the forums – yet they’re going to allow IMVU and other games to advertise on their main website pages?
There’s an idiot running these decisions of LL. I rather suspect this is the same idiot who’s been responsible for a series of bad ideas/failures since he started at LL.
Stupid stupid stupid.
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Have IMVU ads shown up? Not seen any… I’m supposing someone at LL would have the foresight to block them … but you never know…
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Not seen any on Linden pages, but they’re certainly flooding google ads everywhere else (yes i am aware probably targeted to me based on gamer prefs). LL might be able to say “no IMVU on our pages” but how they gonna block every game advertised? – it will quickly turn into whack-a-mole.
I don’t understand why they stopped using their own ad system. They handed it to a third party (who failed) and since then have done nothing but run standard LL ads. As a merchant i’d love to be able to advertise on their pages to a general SL audience – mainly because marketplace enhancements are so ineffective.
They had a good working system – they removed it, tried something else, removed that (cause it failed), then reverted to some gifs for LL
Now they seem to think google advertising is their new revenue stream? Stupid
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I, for one, am a dissenting voice here 🙂 I have absolutely no problems with advertising anywhere — on web pages, on the login entry page, on the internal search, on my.secondlife.com, on the marketplace, and so forth. It’s all fine for me.
The reason? 90% of all residents are free accounts. On pretty much everything out there on the Internet, the simple rule is: if you’re not willing to pay for a subscription service, you see ads. Very simple.
I’d be fine, though, if LL eliminated ads for Premium accounts and non-Premium island owners. But I’m not even demanding that; as said, I’m fine with ads.
This won’t be a huge revenue stream anyway — LL simply doesn’t have enough traffic for that. Still, their homepage gets more than half a million visits every day (if my calculations are right). For that amount of visits, they can expect something like US$ 600-1000 a day (again, based on statistics of my own site). That’s not a huge amount, but it still adds up to almost a million US$ annually, or about 1% of LL’s overall revenue. Not really much, but still not something to be completely discarded: every cent counts!
As for blocking ads from competitors, really, that’s sooooo easy to do. I routinely block ads from IMVU and WoW; it’s just a single line on Google AdSense’s back office page. All they need to do is to regularly update that as new VWs are launched, and we all know there are rather few new ones being launched…
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Personally, I don’t mind SL using ads to add to its revenue – hell, Facebook, Okcupid and other social networks do it all the time and no one utters a peep. However, I do agree that it would be prudent for them to not allow competitors’ ads to appear on their webpages.
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Sl is not facebook, and many users still spend a lot to use it! So unless LL wishes to just have users with free accounts or living on Sl homes, then bet not abuse to much, and for a premium member that spends quite a few monthly, i refuse to be flogged by ads, be in their site, on marketplace or else!
Stop milking your user base!
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How is it “milking the user base”? These ads aren’t costing you or I anything – just like the ads on Google search pages don’t cost you a penny.
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Your comment doesn’t make any sense, we users are not really being “milked”.
Nevertheless, it would be a nice touch to eliminate ads for Premium accounts, if that’s so offensive to you.
On the other hand, what would be an alternative for LL to get a little extra cash to pay for their development costs that wouldn’t be so intrusive?
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Umm, actually we are being milked.
Do you think places post ads for other companies out of the goodness of their hearts? No, they do it because the company advertising finds it valuable for that information to be conveyed to the subway users or whatever. Think of it as how your information is valuable …. you may see getting xyz as free but you are giving someone your information in return usually and they think that is more valuable. Basically, we are talking microeconomies here.
Look at it another way. When an advertisement is displayed that is not wanted it fractionally increases the devaluation of your computer/monitor vs when there is nothing there. It is pretty much the same for whatever optical and neural resources get tasked to processing it.
Are those various things major factors? Obviously not. They do point out that more than the advertiser pays, we just think of the other people as rounding errors because it is a minuscule impact for any given person (but we are talking a lot of web hits here).
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Yes, the SL web sites are valuable advertising properties. That’s why LL are utilising Adsense in an effort to generate revenue.
However, that doesn’t equate to you or I as SL users in any way getting “milked”. We’re not actively paying for the ads, nor are we (or our data) directly affected by them unless we actively click on them and go wherever they lead (and Google tracks) or you count the impact on page layout an impact. And in both of these instances, the ads can be forever banished through the simple use of an ad blocker on your browser.
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That explains the weird page layout.. There must be ad’s lucky i blcok stupid ads with adblock plus. LL could better move the ads down and not up. it rips the layout apart.
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Bring it on, I say!
Adverts are there to be ignored, yet advertisers are willing to pay for them. It’s revenue for free.
Note for the ones who didn’t get this yet… ignore them, same as you do for the ones on Google or on TV. It doesn’t hurt & it gives companies’ ad departments something to feel proud of.
Win/win. No losers… well, except don’t ever tell the ad departments we ignore them completely 😉
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Banner ads devalue the brand. The revenue generated will never ever compensate for this.
Cheap and Tacky.
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Aye, that’s arguable. We’d have to calculate how much the “SL” brand is worth.
As said, the expected revenue from ads will be around US$ 1 million annually. Is the “SL” brand worth more than that? I would say “yes” since LL turns out profits of around US$ 60 million or so per annum. So, using that argument, you might be correct.
On the other hand, the SL brand is only as valuable as it’s on the market for sale. It’s a bit stupid to capitalize on something intangible that you’re not willing to sell. Using this kind of logic, it would only make sense to keep the SL brand “pure” if there was a plan, in the future, to sell it for what it’s worth.
And on the other, other hand… if LL can claim that their websites generate a million dollars annually in ads… well, that actually valuates the domain names by themselves, irrespectively of what people are doing in SL 🙂
But I agree, this is definitely debatable. Your point stands: SL’s brand is worth more than the ad revenue it can generate.
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Reblogged this on The Lionheart Times.
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I don’t mind ads one bit, I do a lot of free stuff online and *expect* ads almost everywhere, but the ones shown above are bullshit. If they’re advertising a *product* that’s fine, but none of this stupid “You’re the 9,999,999th visitor!” or “Shady ‘Phone Company’ offering $1 A Month Contracts” baloney that smells of viruses and scams.
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Ads on the SL marketplace would be a _terrible_ idea given the poor website performance of the SL marketplace in general. It is very apparent it is pulling from multiple URLS, adding ads would ad even more to that. If you want to drive people away from a website, as LL does, you make it so it takes 20 seconds or more for web pages to load. They do nothing about it at least. I’ve gotten to the point that whatever is in my “favorites” or to buy later is saved on some other source (Evernote) etc so I can review it at a much faster pace later on.
It’s worse enough SL itself takes forever but don’t extend that to the web in general. We’ve been waiting for much faster performance for _years_ in SL. Don’t go backwards.
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I’m in the UK, and while I sometimes have issues with the SLMP, they are not anywhere close to what you describe – any delays I experience are limited to lesss than a handful of seconds at the most, so interesting.
I’m not advocating wholesale ads for the SLMP – rather, something that can be handled on *some* pages and keyed towards specific RL “partners”, if it is done at all, which would allow LL to capitalise on the high traffic volumes on the Marketplace. Again, for those that don’t want the ads, blocking should be relatively easy (and eliminate and performance hit).
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If SL was in the current age of being a zipper in-world and out-world experience I wouldn’t mind some non-obtrusive ads on their websites at all (as long as I could tell the difference between RL and SL ads).
Right now SL is still in the world of dial-up internet speed, that is what has kept it from being the Facebook of virtual worlds all this time.
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I have to wonder if the issue is the nature of the ads, it can’t be the concept of advertising itself as many people advertise on the SL forums, be it signatures or posting in the sections of the forum designed for advertising.
I have to say that I think the SL Marketplace should be out of bounds for this, unless there’s an easy to find way for SL Merchants to advertise in those spaces, external ads should not be competing with internal ads there.
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No idea on the backlash – but commented on your site as well :).
Disagree on the the Marketplace; I don’t see why RL ads should be seen as “competing” with SL merchant ads. As you’ve said yourself, it would be good for LL to strike up some “strategic” advertising with “partners” – and in many respects, the SLMP is the place where these could be leveraged in a manner that could be attractive to such partners simply because of the volume of traffic. Such ads don’t have to appear on every MP page (I’d certainly suggest leaving them out of Merchant store pages, or pages from search results carried out within a store for example), but I see no problem with such ads appearing on the SLMP home page and in the general search result pages, even if limited to just the one banner ad. And again, people can block them easily enough if they don’t want them.
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