GenuineVC David Beisel's Perspective on Digital Change

May 18, 2005

The CEO of Indeed, Paul Forster, addressed a number of topics on yesterday’s Syndicate panel entitled “New Pathways to Profits: Exploring Business Models.” I caught up with him after the session to chat about the very insightful distinction he made about how corporations can monetize content, even though RSS allows it to be decoupled from its origins. After all, how do you monetize content when it’s everywhere and no longer under complete control?

Paul drew a distinction between what he calls explicit monetization vs. implicit monetization. Explicit monetization is direct and overt. By definition, user-generated revenue is tied directly to the feed itself. The best example is the placement of ads in publisher content RSS feeds. Classic model of content surrounded by advertising.

Implicit monetization is more subtle. The way I understand his characterization, corporations can offer RSS feeds which are part of the value of a user’s revenue stream, but the revenue generation isn’t directly tied to the feed. For example, UPS or FedEx offering a tracking feed tracing the path of a customer’s package. It is not explicitly a revenue-generator, but rather delivering service value which the customer certainly pays for in turn.

I would also argue that there is a third category of monetization somewhere in between explicit and implicit, which I’ll call advertorial monetization. There is a distinctive set of content that companies can offer which is both editorial content and advertising – i.e. advertorial. In these feeds, the content is the advertising, yet it still delivers value to the end-user. For example, e-retailers could offer consumers a feed with weekly coupons. Or, eBay could offer a feed with the persistent results of my search for “t-shirts,” so I always know what’s for sale on its marketplace. In both of these cases, these feeds are advertorial because they are clearly merchandising a company’s products, yet they still offer value to the end-user.

I think that both start-ups and large corporations alike can benefit from exploring which of these three monetization strategies are best suited for the type of syndicated content they offer their customers – explicit, advertorial, and implicit monetization. It’s not a one-size-fits all.

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  • Rob Go
     - 28 minutes ago
    The new @Wayfair holiday TV ad (featuring my home). Sneak peak here http://t.co/OmoNrxHy9V
  • Rob Go
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    Cool design focused event @bladebos Nov 6. Limited seats available! http://t.co/qHjU4WBeTx
  • Lee Hower
     - 1 day ago
    @vcparty that statement is true. FRC's LP base looks pretty similar to Sequoia's though
  • Lee Hower
     - 1 day ago
    @vcparty agree. some LPs have to bend their model, though best LPs don't care much about concentration - they focus on accessing best funds
  • Lee Hower
     - 1 day ago
    @vcparty thx - would slightly disagree trad'l LPs & smaller funds are misfit… best seed funds have trad'l LP base (albeit concentrated)

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