UGC and local media
Apr 1, 2009 12:00 PM, By Timur Yarnall
Set up user-generated content on your Web site to open up new revenue streams.
YouNews UGC widget with text link sponsorship for SEO purposes
Archive (and potential syndication)
The importance of storing both your station-generated Web content and user-generated content in perpetuity can't be overstated; it's absolutely essential in terms of driving increased traffic, user engagement and revenue to your site. Creating a premium local video archive of the best professionally generated and user-generated video for your market should be the goal — something like a local version of YouTube. Virtually all of the primary UGC solution providers will enable you to store your published video in perpetuity at no additional storage cost, and services such as Amazon's S3 offer “storage in the cloud” at rates as low as 16 cents per GB. The creation of this long-term archive, and the possibility to syndicate this content out to multiple sources on an ad revenue share or license-fee basis, is often referred to as long-tail monetization.
Revenue/monetization strategies for UGC
Think local when determining how to generate revenue from a UGC channel on your site. Local CPMs are far outpacing national CPMs, and local advertisers will place a value on your brand and editorial direction that a national buyer never will. In some cases, local CPMs have outpaced national CPMs by 10X.
I strongly believe in selling what we refer to internally as “flat-fee sponsorships on a capped-impression basis.” This means that your team should sell UGC (and Web site) inventory on a flat sponsorship basis, but with a firm limit of how many ad impressions that sponsor will get. For example, you might charge a local sponsor $15,000 per month for the following:
- Exclusive sponsorship of one of your UGC channels. Let's say, for example, you're running a Cutest Pets contest that month, and the advertiser is the exclusive local sponsor of that channel online.
- A 300 × 250 display ad above the fold on all Cutest Pets pages — up to 1 million impressions.
- A simple text link on Cutest Pets pages that links out to the sponsor's business Web site. This is helpful for the sponsor's Search Engine Optimization (SEO) rankings.
- A 15-second preroll ad on all Cutest Pets videos that are submitted — up to 100,000 impressions.
- An optional on-air visual banner or short mention in any on-air spots that promote the contest.
- If the impression levels listed above are met, the station will traffic national ads as backfill for the added impressions. Note: This is critical, as if you don't put this impression cap in place and a Cutest Pet video goes viral, you may end up having a huge video bandwidth bill on your hands with no additional revenue. Having the impression cap and right to run backfill in place protects the station and allows you to generate more revenue.
If you do the math on this sponsorship package, the sponsor is paying $10 cost per thousand (CPM) on the combination of the display ad and text ad, and $50 CPM on the video pre-roll ad. These CPM levels are healthy enough that, as you continue to promote your site and grow traffic through a combination of UGC and station-generated content, you'll have a strong business and outlook for years to come.
Timur Yarnall is the founder of Broadcast Interactive Media.
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