8 Nov 2008

Analysis of How to Make Money At Blogit

Now, Blogit is a slightly strange concept in that bloggers and writers pay a monthly fee to enable them to use the Blogit platform. The bloggers earn money when other paying members read their blogs. Note that this is a zero-sum game as far as the fees are concerned. The strangest thing is that the casual reader also has to pay the same fee, which of course is similarly distributed. There is no income from any outside sources such as advertising.

Now, paying a subscription is no different to a hosting fee, but this particular business plan reminds me of all those long dead attempts to create private internet networks, such as AOL and Compuserve. As the rest of the internet surfers cannot read your Blogit articles what's the point? I guess there is a point in creating a community and by paying a fee it should, theoretically, limit the amount of poor and worthless content.

Data from Alexa shows blogit.com as having a 3-month reach of 0.0014% which is much lower than Xomba, and considerably lower than HubPages and AssociatedContent. Most of their traffc comes from the USA and India, with also significant users in South Africa, Pakistan and Indonesia. Blogit is most popular in those four countries outside the USA.

So, if the idea of a blogging community is appealing, what's the best way to make some money out of Blogit? Although Blogit advertises that you can subscribe for as little as $9.95, this is only true if you pay for a whole year in advance. The cheapest basic package costs $12.95 on a monthly basis. Half the subscription fee goes to Blogit's owners and the other half is paid out in proportion to which other blogs you read. If you only read one other blog then 100% of the money is distributed to that one writer. So, if one person subscribes and then a friend also joins as a referral the cost after 3 months is as follows

For 2 people for 3 months

Fees = 2 x 3 x $12.95 = $77.70

Income = 0.5 x $77.70 = $38.85

One referral fee = $20

Total cost = $18.85

So for just under $19 you get 3 months basic membership for 2 people - that comes to just $3.14 per person per month. If you don't make more than that after 3 months then it's probably not worth it.

For any further persons joining your inner circle, the calculation is similar.

For 3 people for 3 months

Fees = 3 x 3 x $12.95 = $116.55

Income = 0.5 x $116.55 = $58.275

Two referral fees = $40

Total cost = $18.275

This comes to just $2.03 per person per month.

This all assumes that your inner circle only look at each other's blogs. This may be hard to enforce in practice but should be the aim. After your first 3 or 4 months review your incomes. Referral commissions are one-off payments so after that your average monthly fee will start to creep up. If you're not seeing worthwhile income coming from Blogit then just give up and write elsewhere. But with a well-defined strategy leading to such a low real monthly fee then it may be worth a try.

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