Tumblr launches ads on all users' blogs Thursday, will unveil revenue program for partners later in 2016; users can opt out of ads on their blogs
Ads on your blog by default, opt in to make $, opt out to hide them http://staff.tumblr.com/... Casey Newton / @caseynewton : If Tumblr's display ads are even half as ugly as its Dashboard ads, it's about to turn into GeoCities http://techcrunch.com/... See also Mediagazer
Context & Ripple Effects
Tumblr spent years resisting advertising before caving in 2012, then fumbled distribution through Yahoo — it only rebuilt a dedicated ad sales team in February 2016 after integrating with Yahoo's ad sales failed.
This launch lands while Yahoo is reportedly weighing whether to let Facebook sell into the app because just 10% to 15% of Tumblr's ad inventory is in use; turning every user blog into ad real estate is how Tumblr manufactures sellable supply from its own community.
First-order effects
- Every Tumblr blog carries display ads by default starting Thursday; users who object must actively opt out, while partners who accept them become eligible for a revenue program Tumblr says it will unveil later in 2016.
- Casey Newton's comparison to GeoCities captures the immediate user-facing risk: if blog ads look like the Dashboard ads critics already dislike, Tumblr trades community goodwill for inventory at the moment it can least afford churn.
Second-order effects
- Filling long-idle blog inventory attacks the underuse problem that had Yahoo considering handing Tumblr ad sales to Facebook — higher own-channel yield weakens the case for outsourcing to a rival platform.
- The promised partner revenue program gives Tumblr's top creators, already organized via the Creatrs Network's brand collaborations, a financial reason to keep ads on rather than opt out.
Third-order effects
- If the default-on-plus-opt-out structure holds, the opt-out tends to harden into a paid product — which is exactly where Tumblr ended up six years later with a $4.99/month ad-free tier, monetizing the absence of ads once their presence became the baseline.
The trend: User-generated-content platforms are pushing monetization onto members' own pages, then converting the opt-out from a courtesy into a subscription upsell.