What’s The Value Of Your Blog?

This is a topic that I’ve wanted to write about ever since I read Web Analytics 2.0 by Avinash Kaushik but didn’t because I know how uncomfortable this sort of thing makes most MMORPG bloggers. However, after a fascinating post from Tobold and some really interesting comments, I figured what the heck.

As some of you may know, I work in the web industry and thus have a strong interest in web design, development and, especially recently, statistics, analytics and online strategy. My personal blog (this one, duh) combines the three things in life I love most (MMORPGs, writing and the web) and is a perfect outlet for me to experiment with different ideas and be creative, albeit at a very slow pace. As you may have noticed I have a couple of adverts on the site (in places I consider quite low impact, especially when compared to MMORPG.com, WoW.com or Massively) and I know some bloggers totally loathe it although I really can’t fathom why. I don’t buy into the argument that your blog needs to be plain black and white text and that if it’s not you’re somehow “selling out” and not blogging for the pure love of blogging. It’s a silly notion to me as I believe the entire blog or site conveys an experience to the user. Design, aesthetics, usability, interactivity, purpose, all of these things are important to the overarching adventure of the visitor.

However, saying that, of course absolutely, utterly and categorically content is the single most important thing about any blog, including my own. I started blogging 14 months ago with a black and white theme with no images or design and I simply couldn’t maintain this hobby without a vast love for the subject material. If I really wanted to make cash outside of my job, I’d be better off begging in the streets rather than running a blog.

Anyway, I’m starting to digress as the subject of this post was about identifying the value of your blog. Avinash breaks it down into the following:

Cost of Blogging

To calculate value, you need to work out the costs of your blog first and it’s surprisingly higher than you may think. Avinash determines this by either the technology cost and time spent or the opportunity cost.

Technology
This is the obvious and easy one and includes hosting and domain registration plus any other hardware (or software) costs you might have. Here are my costs:

Hosting ($20 per month = $240 per year) + domain registration ($10 per year) = $250 per year.

Time
I, as I’m sure we all do, spend a lot of time on my blog. A quick sum reveals that I spend approximately 16 hours a week doing blog related activities which, if I multiple by the amount I could get if I worked those hours instead, is $352 a week or an incredible $18,304 a year!

Opportunity Cost
Opportunity cost is the theoretical loss you incur whenever you do an activity i.e. what could you have accomplished with your time had you being doing something else? Avinash talks about it in more detail but, following his rules, I’m going to estimate my opportunity cost at $9,000 a year, the amount of money I could’ve made had I done something else other than blog.

Your total cost is either technology + time or the lost opportunity cost as you can’t do both at once. For the sake of my example, I’m going to disregard opportunity cost. Therefore the total cost of my blog is a whopping $18,554 a year. Please, for the love of God, no one tell my wife.

Benefit (ROI) from Blogging

Now that we’ve worked out how much my blog costs me, let’s look at how much I make from it.

Comparative Value
Again, Avanish talks about this in more detail but essentially comparative value is how much you would make if you sold your blog on to someone else. There are sites out there that calculate this for you so I plugged my stats into the Technorati one and it told me that my blog is apparently worth an impressive $564. Not bad at all.

Direct Value
This is the direct money you make per year via adverts or affiliate links or any products you sell on it. The amount I make from my adverts varies but on average it’s about $30 a month or $360 a year.

Nontraditional Value
This is all of the opportunities in your live that your blog has given you, whether that’s free press passes or review copies of games or books. It’s also the value of skills that your blog has taught you or the work related opportunities it’s opened up. Have you acquired a paid freelance writing job due to your blog? Are you able to apply the skills you’ve learnt blogging to another aspect of your life? Has the simple fact that you have a blog helped you get a job?

This is difficult to put a dollar value on and is really nothing more than “guesstimation”. For me, I’ve gained a couple of “freebies” (I’ve just been offered a free review copy of a book for instance) but, more importantly, I’ve learnt a ton of valuable information that has had a direct impact on my working life. Due to the things I’ve learnt about blogs, WordPress, SEO, online marketing, AdSense, AdWords etc, I’ve actually been able to help create revenue for the company I work for. I’m gonna take a wild stab and estimate all of this to be $10,000.

Unquantifiable Value
This, as the name suggests, is everything your blog gives you that you simply cannot quantify. It’s the nice emails you get from readers, it’s the witty and interesting comments you get on your blog, it’s the satisfaction you get from writing a good article, the fun you have from blogging in general and the pure joy you spread across the Internet. Such moments for me include when I got an email from a professor in an American college who enjoyed my article on multi-culturism or when a reader left me a comment saying that they’d laughed so hard at my article they had spat their tea all over their keyboard. Those responses filled me with such positive emotion that it makes everything I do worth while and are, in my opinion, utterly priceless. They are categorically one of the main reasons why I blog.

I don’t know if it’s possible to put a monetary figure against this value but I will tell you this: if the total ‘cost’ my blogging is $18,554 a year and the total amount I ‘earn’ back is $10,924, the unquantifiable value is, without a doubt, completely worth the $7,630 ‘loss’ I make. In fact, I would say it’s worth more by a long, long shot.

So, interesting stuff, eh?

-Gordon

Update: Here’s the link to the, apparently, Technorati powered site that I used to “value” my blog.

Update: I received a nice email from Avinash Kaushik himself explaining that I’d made a small mistake in calculating the cost of my blog. It’s either technology + time OR opportunity cost, not both, which makes sense. Thanks Avinash!

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37 Comments

  1. Larísa says:

    I was once pointed towards one of those website that made a calculation of what your url was worth in money considering the googleranking/links to it, whatever do I know. (don’t think it was the one you’re speaking of – I couldn’t find the service there btw. Anyway. it turned out that my url at that very moment was worth hundreds of Euro. Even if I AM in the PR field, it was a bit of a revelation to realize that I’ve actually somehow probably managed to build a little brand of my own and that this brand has a monetary value. Shocking.

    Not that it has any impact on my blogging though. And it won’t affect my decision not to have ads. It’s not that I’m frowning or looking down on every blog that has it it, as long as they manage to keep goldsellers away and still have the content in focus and aren’t just clotted with the ad stuff. But I wouldn’t want to have to deal with it myself. The freedom from ads adds to my feeling of doing this for fun and not for profit. And the time I “invest” in it isn’t really lost opportunity cost to me since I actually enjoy the blogging activity as such. I certainly wouldn’t have taken extra jobs during this time if I hadn’t been blogging. I’d rather have been slacking in front of a movie or something in those lines.

    • Gordon says:

      It’s all hypotheticals for sure. Just because some site told me my blog is “worth” $500, that doesn’t anyone’s actually going to buy it :) I just find the subject quite fascinating as I’m a bit of a stats geek.

      The advertising thing is interesting to me because it affects of my day-job and has taught me a heck of a lot. The money it generates for me is actually insignificant but the ‘value’ it’s given me through knowledge and understanding of the web and blogs as a whole is a lot greater. And because I find that so useful, I’m willing to place a higher importance on it than a lot of other bloggers. Obviously I still place the important of my content and its readers a lot higher though which I why I try to keep the impact to a miniumum and, for instance, am not willing to start putting ads in RSS feeds (which is why most of my readers view the site).

      In terms of opportunity cost, yes, again it’s very relative. But it’s not just about going out and earning a buck in another job. What about the opportunity cost we all sacrifice from not engaging with our friends and family when we blog? I know the time I spend in front my computer irritates my wife, for instance, and I could be spending that time out in the park with her instead or making babies.

      I guess the whole thing is like trying to put a maths equation on real life time and emotions. It’s never going to work but it’s quite fun :)

  2. spinks says:

    I’m beginning to feel like an idiot for blogging when I don’t make anything out of it.

    • Gordon says:

      Ah but you do, that’s the point :) Even though you’re not earning money, you’re still getting fun, friendships, relationships, satisfaction, and other sorts of enjoyment out of it. That’s the unquantifiable value from what you do. Put it this way, how much is your blogging hobby worth to you? It’s obviously worth your time and attention, moreso than other activities, right? It’s an interesting thought.

      • spinks says:

        Well, I assume you don’t plan to take down your ads. So you don’t believe what you just wrote.

        Sure, it’s an interesting thought.

        • Gordon says:

          I’m not sure I follow what you mean.

          I have actually considered the whole ad thing quite a lot and constantly debate it as I don’t like the idea of readers being put off by it. Still, I’m not exactly sure why some people are so vehemently against it though. I can appreciate disliking gold selling ads and even ads that diminish the usability of a site but other than that what are the reasons not to have them?

  3. Andrew says:

    Applying “opportunity costs” and “time costs” to any leisure activity is useless…. if you weren’t blogging you wouldn’t suddenly be putting all of that time into a labor activity. I’d wager that the average blogger would put exactly ZERO percent of their found time into making extra cash if they suddenly stopped blogging.

  4. Andrew says:

    @Spinks: Don’t feel like an idiot – I go out of my way to turn down advertising opportunities and keep my blog ad-free. It’s a hobby, not a freaking job! ;)

  5. KaarBaak says:

    I would say that as long as the “hard number” cost:return delta is reasonable…and your family is not unduly suffering from the time spent (financially or emotionally)…then it’s no worse than playing a game or going to a movie.

    Some great things to think about. I asked a similar question of 3d party app developers…who generally do their work (and it’s even more work-like than blogging) and they give a similar response. Funnily, most regret the time not playing EvE as the greatest sacrifice. They all seem to make the right call when balancing family/OOG time with dev., as most bloggers do.

    As someone commented above, it’s not about the work you would be doing otherwise, rather the other recreation you would likely be doing otherwise. If blogging is your recreation…well it’s sure better than drugs or beating your wife (that’s the excuse I use with my wife anyway.)

    o/

    KB

    KB

    • Gordon says:

      Absolutely. Likewise, you can also put a figure on the value of your recreation by comparing it to other potential hobbies. If going to movies costs you $5 an hour then potential your blogging hobby is “saving” you $5.

  6. Tobold says:

    “Your blog, tobolds.blogspot.com/, is worth $37,259.64″

    Hmmm, I’m not so sure about the 64 cents.

  7. Wasdstomp says:

    I am not sure how much truth there is to that site. I put in about 20 different sites, and all of them came back valued at 564.67. Do you really think worldofwarcraft.com is only worth $500, or aol.com?

  8. Arkenor says:

    I notice if you put either yours, mine, or killtenrats.com into that website, we’re all worth a mysterious $564.54, so I’m not sure how much confidence I have in it.

    $20 a month! You need to shop around for a better webhost!

    • Gordon says:

      Ha, yeah that is kinda weird… honestly, I don’t think it’s useful for more than a bit of fun anyway :)

      Y’know, when I took out my hosting about 4 years ago (I used it for my email and personal stuff long before I started the blog) it was a pretty good price. Now I battle with the price vs the effort of moving it all :P

  9. I’m in a similar boat, Gordon. I love to blog. Love love love it. But one of those things I’ve always wanted to do is make a living from writing in some shape, form, or fashion. I have a few simple ads on my blog, but they’re only on the individual post pages. I may end up doing a few more subtle ones like yours for no other reason than to cover hosting costs for the year.

    One of the problems of our “niche” is that we don’t have a product to really ebook up and sell. Like you said, monetization is often looked down on based on the negativity associated with RMT and microtransactions. Sure, we have themed posts that could tie together into a single volume, and I guess we could work them together and make a sellable product, but would that work? I’m not so sure. Such is the life of any arts/humanities lover trying to make a living doing anything related to what we’re good at/love. If you ever need a partner putting an ebook together about MMOs (or anything else for that matter), let me know. I’d love to collaborate on something like that.

    I did a cost analysis last week, actually, of what I would need to be able to sell to make a living selling nothing but Kindle ebooks of my fiction. I don’t know if I’ll ever be /able/ to do that, but it’s a fun exercise nonetheless.

    The one thing I still struggle with is just getting my blog out there. Monetization or not, I want people to read, enjoy, and discuss what I write. Like I said a while back with you via email (to which I still need to reply–I’m bad people! I’m sorry!), I feel I’ve hit a plateau and very much would love to get new people involved with my blog.

    I think you did it the right way, though; you made the site pretty. Until recently, I was unhappy with how my blog looked. With the redesign I did this week, I found that I am much happier sending people there as it looks like a legitimate piece of cyperspace now (in all browsers, I hope! Heh).

    But I think I’ve rambled long enough.

    • Gordon says:

      I’d love to make a living from writing too, whether it’s as a freelance writer or author or editor or anything like that. Fortunately I also rather enjoy the web industry though so it’s not a complete loss doing what I’m doing ;) Maybe for me, somehow combining both things into one would be the ultimate dream.

      The whole monetization subject is a tricky one. Can people make decent money from MMORPG blogs? Honestly I’m not sure because it’s such a niche genre although, then again, I’m see for-profit sites like MMORPG.com and Massively and I assume they make a reasonable income. It’s never going to be easy though and first and foremost the writing should always come first. I couldn’t write a blog almost ever day of the week if I didn’t love the subject material.

      • Where they succeed is that they have a team of writers who supply constant updates across the entire gamut of MMOs. (It also doesn’t hurt Massively to be owned by AOL.) That could be the first step to monetizing if you wanted–get a team of weekly writers to supplement yours. Then you can work out the contracts for payment, whether by article or revenue sharing from the ad networks.

        And I’m right there with you. I really enjoy my job, but writing is one those ways I’ve always defined myself. I don’t expect it to be easy, nor do I expect it to be quick. I do expect it to be possible.

        My thing, though, is that I’ve had Adsense ads on just my post pages. And my traffic is pretty consistent, and I thought I got a few pennies for impressions, but on my analytics page, I am seeing whole weeks going by without any revenue being earned and then a day or so that “spiked” into a dollar or two. I guess those are from clicks, but I wonder about the impression conversion rate.

        • Gordon says:

          To go down the Massively (or even IGN) route you need capital to be able to get started and then it’s becomes a real job running a real company even though essentially it’s a giant blog. I’m not actually sure how sites like Massively generate a profit because (I worked it out) they’d probably have to make over $100,000 a year in order to not make a loss and I’m not even sure if that’s possible from ads alone. I’d be really curious to see their business details.

          One of the sites I really like is Rock, Paper Shotgun as it’s more of a less commerical webzine but still more ‘professional’ than an amatuer blog. The four writers are all British freelance writers (Kieron Gillen writes some big named Marvel comies for instance) and they contribute to the site to not only make a bit of extra cash but also write excellent and humorous articles.

  10. River says:

    I do it for the chicks.

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