February 18, 2009

Outbrain Unveils Revenue Plan With Advertising That's Not Evil

When Outbrain announced it had raised $12 million in its latest round of funding, I openly speculated that the team and its VC partners had wind of a revenue plan that the blogosphere at large hadn't been alerted to. Sure enough, just a week later, that secret has been revealed, as Outbrain, today, rolled out a new program that will display sponsored related links, attached to blog posts from its network of users, myself included. They call it "sponsored but good", and it represents an attempt to find a solution that is beneficial for readers, publishers and advertisers, which has proven very difficult for many vendors.

Outbrain is well-known for its rating widget that sits below users' posts, and tries to find related stories, both on the blogger's site and the service's network. Starting today, some posts will also feature a sponsored link - not to a paid-for blog article, but instead, to an organic article selected by the advertiser which will put their product in a good light.

An example sponsored ad, via Outbrain

I spoke with John LoGioco, the company's vice president of business development, yesterday, and he said he hoped the new program delivered a "perfect balance," as readers would find new and interesting content that was non-disruptive, advertisers would put sponsored content on trusted sites, and publishers could gain revenue.

The benefit package delivers a good share of revenue to the blogger in today's announcement, LoGioco said, adding he hoped the program would be one that be trusted and adopted by bloggers looking to add another incremental revenue stream along the more typical display ads, dominated by Google.

The hope? An advertising plan that works for all

"Advertisers are excited so far, because they know the power of trusted voices driving demand creation if people are considering a product but are in the discovery phase," LoGioco said. "They haven't really had a chance to take a piece of the conversation that has been positive about them and amplify it. We can reach the influencer audience, and it is scalable."

With Outbrain's growth in popularity, serving an ever-increasing number of recommendations from sites in the network, the company has reached the point where advertisers are looking to reach readers - ones that are tired of seeing pop-up ads and other tricks that get in the way of their information browsing.

"We have all seen how platforms can be good for the advertiser or the publisher, but rarely for the reader," LoGioco said. "The advertising is in a non-disruptive format, and it leverages authentic brand endorsements. We are being very honest and open with bloggers and publishers."

The target for the "Sponsored but good" program won't be for direct marketers, and it won't be self-serve. Bloggers can opt in to receiving revenue from the program, and can remove specific sponsored links, once registered with Outbrain, and use what they call a link zapper to zap live sponsored recommendations. And if you think you're share of the revenue pie isn't going to impact your life, you can even choose to pass it off to charity.

See Also: Coverage from CenterNetworks, Mashable and VentureBeat.