SOCIAL SPARK IS LIVE!!!
The first thing I want to say is how proud I am to be working for a company that is on the cutting edge of social media marketing. We have come a long way even in the short time that I have been here. And now the questions about our new product are starting to pour in.
The new Dynamic Pricing has really caused a lot of questions. How does it work? Why does it work that way? Is this better for the advertisers or the bloggers? Well, I will do my best to address all of these issues here. I do have a finance degree so, as Crystal says, that should come in handy!
How Does It Work?
It's simple supply and demand really. If there is more demand than there is supply, the price will change until there is equilibrium. If an Opp seems undesirable because it is offered at a lower price, no Postie will take the Opp. After a certain period of time, the price offered for the Opp will increase until someone takes the Opp. If a bunch of people rush to take the Opp (demand), then the price offered will drop back down. Advertisers choose the range they want to pay for each Opportunity.
Why Does It Work This Way?
We often had Opps that never filled in PayPerPost because they were offering a lower price for harder requirements (high word count, embedded pics, multiple links, etc). Advertisers simply did not know what to offer for certain kinds of Opps. We have added the dynamic pricing feature so that the advertisers will be able to offer a price range for every Opp. Therefore, the dynamic pricing system takes the guesswork out of pricing an Opp. Now, you simply offer a range.
Is This Better for the Advertisers or the Bloggers?
The answer to this question is .... BOTH. IT IS MORE BENEFICIAL TO THE ADVERTISERS AND THE BLOGGERS!!! Advertisers no longer have to worry about overpricing or underpricing an Opp. If it is over-priced, the price will drop to decrease demand. And if it is under-priced, the price will rise to increase demand. Bloggers now can decide if that 300 word Opp with four links and a pic is worth $5.50 to them. Or if it is worth waiting to see if the price will go up. Either way, the Blogger gets paid whatever they reserve the Opp for (as described in <a href="http://community.izea.com/blog/2008/04/dynamic-pricing.html#comments">Carri's Post</a>)
Just Remember: SocialSpark relies on Supply and Demand. If you have any questions about how this works, please send in a ticket by clicking on the 'Help' tab at the top right of your SocialSpark account.
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Comments (RSS)
Owen Cutajar said...
If only life were that simple ;)
There is one aspect that skews the whole concept behind the Demand/Supply model and that is the fact that different bloggers have different standards and perceive the amount paid for the opportunity in a different way. For example, $5 here in the UK would buy me 2 loaves of bread and it's just not viable for me to do anything longer than a 50 word post for. However, a 15 year old in Thailand for example may be ready to do much more than that, based on their circumstance and the fact that $5 means much more to him.
Don't get me wrong, I think the whole idea behind dynamic pricing is inspired. It models the way the world works and removes a number of inefficiencies from the system. I'm just uncomfortable in the way it implies an undifferentiated supply of blogging resource when reality is a bit more personal than that.
Apr 23, 2008 6:32:26 PM
Karen said...
I think this is sad. I don't think the prices will go up because there will always be those who will write for low amounts. That does not mean that the advertiser will be happy with the quality of the writing. I thought we would get away from having to sit and wait for ops of any quality to come our way. I do not think this is beneficial for advertisers and certainly not for posties.
Apr 23, 2008 10:33:28 PM
Jean said...
I wonder what the current average payment is for an opp. It would be interesting to see the monthly average payment I think. The first month or so might be slightly skewed as there were so few bloggers but perhaps this could be put in the suggestion box...? That way we could see what we were bidding for. Not that it would change anything for me. I'm waiting for about 8 opps and still waiting...
Apr 24, 2008 5:57:55 AM
Mrs. Mecomber said...
Karen says it all for me, too. There will ALWAYS be Bloggers who will grab the low-priced opp. This "eBay" kind of auctioning is insulting.
If advertisers simply did not know what to offer for opps, then TELL them! IZEA knows that $5 for a 300-word opp with media file is waaay too low. And I don't see that changing much at Social Spark, except that opps are now $5.50!
This bouncy kind of system is elusive and too fluid. It still requires that we watch the boards all day, and that we Bloggers are never 100% sure of what we're going to get when we write a sponsored post.
Apr 24, 2008 9:10:49 AM
RealityTVFan said...
"If an Opp seems undesirable because it is offered at a lower price, no Postie will take the Opp."
lol
As I have said a few times, there's always people willing to take opps no matter what the price/requirements/subject matter. $5.50 is worth more to different people, and in different countries for starters. Maybe, just maybe if SS was flooded with opps, pages and pages and pages for people to choose from the dynamic pricing would be useful, but with just a handful dropping per day - people are gonna be jumping on them and all dynamic pricing is going to achieve is ensuring we all earn less :(
Apr 24, 2008 10:15:35 AM
Tina said...
@ Owen: Different people definitely have different standards. It is amongst a particular segmentation of Posties to choose whether or not an Opp is worth the amount offered.
*FYI: We don't allow 15 year olds into the Marketplace
@Karen: If the advertiser is not happy with the quality of the blogging, they are being advised to have a higher base cost and to target a more particular set of bloggers. They also can target their Street Team or Blog Roll.
@Jean: Do you mean average payment for an individual Opp? Posties taking the Opps or not determines the pricing.
@Mrs. Mecomber: This pricing method is not meant to be insulting at all. It is meant to help the advertisers get their Opps filled and to help the Posties get paid better for less desirable Opps.
@Reality: Advertisers are submitting more Opps every day. The goal is to have this pricing method in place and understood by both our Advertisers and our Posties before we are flooded with Opps.
Remember all: You should take Opps that you are interested in blogging about, not solely based on their price. Opps are coming. Please give it time and be patient. The site has only been open to the public for a week!
Apr 24, 2008 1:54:24 PM
prapChurrylaw said...
Great site this advertiser.izea.com and I am really pleased to see you have what I am actually looking for here and this this post is exactly what I am interested in. I shall be pleased to become a regular visitor :)
Apr 5, 2009 6:39:37 PM