July 12th, 2012

Can Tumblr Embrace Ads Without Selling Out?

Rob Walker writes for the NY Times Magazine about David Karp, Tumblr, and the social blogging companies efforts to turn a profit :

The features Tumblr eliminates are as important to the way it feels as those it adopts. Bijan Sabet of Spark Capital, an early Tumblr investor who sits on its board, says that it is “normal behavior” for a founder to be excited about adding new bells and whistles, but Karp seems excited about doing the opposite: “He’ll tell us, ‘Hey, got a new version coming up — and I took four features out!’ ”

Karp’s thinking about the comments section, which is generally assumed to be a core blog feature, helps illustrate his broader ideas about how design shapes behavior online. Typically, a YouTube video or blog post or article on a newspaper’s site is the dominant object, with comments strewed below it, buried like so much garbage. Thus many commenters feel they must scream to be noticed, and do so in all caps, profanely and with maximum hyperbole. This, Karp argues, brings out the worst in people, so Tumblr’s design does not include a comments section.

Like lots of so-called Web 2.0 companies, Tumblr is now reckoning with the very banker-ish concern of figuring out how to make money. It has tried, over the last five years, to do so by selling tools that allowed users to snazz up their blogs or promote posts. But efforts like those haven’t generated nearly enough cash to offset its expenses — let alone justify the $800 million valuation suggested by its most recent round of venture-capital investment last year.

Shortly before Facebook’s initial public offering, Karp started talking about making money from advertising — which seemed to run counter to a declaration he made in 2010 that advertising “really turns our stomachs.” Then again, pretty much every social network chieftain, including Mark Zuckerberg, seems sour on ads until the moment they start making ads the center of their entire business.

Karp has said Tumblr could be “wildly profitable” overnight by simply incorporating conventional online ads into the platform, but he believes that would spoil the community and the creativity that have taken shape there. His proposed solution entails advertisers’ being just as creative and expressive as Tumblr users. For now, that means that a spot on the Tumblr dashboard generally used to highlight the company’s picks for the coolest stuff happening in its network will include occasional content from paid sponsors. The first participants included Adidas, Calvin Klein and the movie “Beasts of the Southern Wild,” generating more than $150,000 in revenue within a month.

Read the full article here.

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