Digg Shakes Up the Advertising Game

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Digg just took online ads - particularly social advertising - to a whole new level. Advertisements will soon be integrated into regular Digg content (the 'river'), appearing similar to a regular submission. And, just like Digg submissions, the ads can be voted up or down by users. From the Digg blog:

"Digg Ads will give you more control over which advertisements are displayed on Digg. The more an ad is Dugg, the less the advertiser will have to pay. Conversely the more an ad is buried, the more the advertiser is charged, pricing it out of the system."

The immediate question is whether Digg users will accept this kind of advertising. If there's a revolt, look for users to vote down every ad they see, driving advertisers out and causing a collapse of the entire advertising model. And it's not difficult for a bloc of Digg users to have a major impact on voting. Considering the Digg audience, it won't be hard for them to tell the difference between an ad and a regular post - meaning votes for ads will be explicit, not confused for regular content. Will users take the time and effort to vote on advertising?

If it works, it's a very attractive prospect for advertisers. It also carries a huge incentive and onus for the advertiser to create compelling ads. Garden-variety ads won't survive in this space - they must be entertaining, informative or a mix of both to garner votes and acceptance. Headlines will be critically important as well - many Digg stories are voted up or down without the user ever clicking-through or reading the story.

Digg plans to start rolling out ads within a couple of months or so. This will get plenty of attention, as it should. It's innovative in a space that typically has problems monetizing content. Looking at the comments on Digg about this news, it varies. However there's no shortage of Digg users who find this interesting and not at all off-putting.

This represents one of the strongest attempts to blur the line between user-generated content and advertising in a social environment. If successful, it certainly won't be the last. If it fails, social networking monetization will take a step backward. Digg, obviously, has the most to lose. It also goes to show that these networks must make money, and users must suffer through advertising mixed with their "personal" experiences. It's not hard to imagine that if experiments such as this continue to fail, users might be forced into a paid model of social networking, or at least have the choice of ad-free networking, at a premium.

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5 comments

RyanO 06-05-2009 2:24 PM

Ads for new and innovative products positioned for 18-34 year olds will be ideal for this medium.

06-05-2009 7:35 PM

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06-05-2009 8:15 PM

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06-06-2009 7:21 AM

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LateaseR 06-06-2009 10:10 PM

I think I will wait this out.  The Digg crowd is not fond of ads...on pages, or anywhere...and the fact that an advertiser will pay more if their ad is buried will certainly cause favoritism to rise.  Its perfect for spammers who have a huge following on digg, not so good for those who are unknown and don't have deep marketing budgets.

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