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The Fourth Time is the Charm: Wattpad to Interrupt Stories With Adverts

Wattpad-in-story-ad-invitationWattpad styles itself a community, but it has the same problem as any other site which hosts content: money.

Over the past few years the social reading community has dabbled in several ways to generate revenue: crowd-funding, native advertising, and selling content.

And now Wattpad is going to deploy ads inside the stories published on its site. From PW:

Wattpad, the online reading and writing community, is launching Wattpad Futures, a new program that will place paid advertising between the chapters of selected stories on the site. Every time a reader views an ad, the writer will earn money.

Ashleigh Gardner, head of content for Wattpad, said the new program will feature “interstitial” advertising between chapters of works posted on Wattpad. Gardner said the program, which will initially run video ads, will eventually include display ads as well. The ads will be placed every few chapters and will also appear every 30 minutes during a reading session.

According to Gardner, about 100 writers invited to be part of a beta test earned nearly a $1,000 a month through the program. Some, she noted, earned nearly $2,000 a month.

Given that ad-blocking is on the rise and the relatively low density of the ads, this venture won’t generate much revenue. And that’s a shame, because Wattpad could definltely use the money.

The thing about Wattpad is that its founders took a wrong turn in the early years. They focused too much on building the community and helping writers create rather than on developing a tool which authors could use to make money.

As a result, authors have been growing their audiences by developing stories on Wattpad and then listing the stories for sale elsewhere. That’s bad news for Wattpad because if it were also a distributor then it could earn a share of those sales. The same is true for selling ebooks on the site.

(Or at least, if Wattpad does sell ebooks or distribute ebooks to Kindle, iBooks, and other ebook retailers then it must be keeping this feature a secret because I sure as heck can’t find anything in the FAQ.)

The best part about selling or distributing ebooks is that the revenue stream would scale with Wattpad as the community grew. Now Wattpad has some 40 million visitors to the site each month, and not a lot of revenue to show for it.

But instead of distributing ebooks, Wattpad has experimented with other ways of making money, including adverts.

Oh, well.

Maybe this is something Wattpad’s future buyer can fix. Rakuten, for example, would be wise to buy Wattpad and partner it into Kobo.

There’s obvious synergy there, don’t you think?


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Mackay Bell August 18, 2016 um 12:50 pm

I think you nailed the key issue here. It’s very problematic to base your business model on unpaid writers contributing free content. Sounds great to a startup guy, “I’ll get content for free because writers are desperate,” but guess what? The best writers use the platform and move on, or figure out how to monetize themselves outside the platform. And the middle of the road simply give up. Even the Huffington Post, famous for not paying writers, finds itself with traffic declining by about a third last year. I think this stuff always bites you in the butt eventually.

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