Finding Revenue in Social Media

As the world of b-to-b media becomes more digital and mobile, publishers continue to seek new channels of revenue for their brands through apps, virtual events, lead-gen programs and marketing services. Now, it's time to explore the monetization of social media.

I am pleased to report that we have just added a new consulting service, Crain's Social Media, to our BtoB marketing services. This new unit offers social media training, including customized training seminars, as well as personalized executive coaching, social media audits and strategic social media planning and execution.

We have hired Tracy Schmidt to oversee the unit as director of social media training and strategy. Tracy joins us from Tribune Media Group, where she co-created ChicagoNow, a network of 350 blogs, and established a nationwide social media training program. Last year, she taught more than 2,500 people and consulted with organizations including the National Association of Realtors and National Association of Broadcasters. We will now be able to help businesses and executives expand their social footprint, improve their social reputation and train their sales and customer relations groups to use social media for business.

In every issue of Media Business we chronicle the new revenue streams of business media companies and brands, focusing in particular on new digital offerings and strategies. Our own venture is one way we have expanded in the world of digital and marketing services, and if you have a need for social training and strategy in your organization, please reach out to Tracy at tschmidt@crain.com.

Bob Felsenthal can be reached at bfelsenthal@crain.com. Bob Felsenthal is VP-publisher of BtoB and Media Business

Ad Network Bizo Makes Money in Business-to-Business Market

Bizo — pronounced biz-oh, as in business — is an ad network founded in 2008 in San Francisco that caters to the business-to-business market, in which businesses target other businesses rather than individual consumers. In a press release scheduled for this morning, the company will report that December was its first profitable month.

Bizo says its revenue run-rate is now more than $5 million, a sixfold increase over a year ago. The company also says its customer base quadrupled between Q4 of 2008 and Q4 of 2009, and its number of publisher partners has increased by more than 30. In addition, Bizo completed a $6 million round of equity financing in December led by Bessemer Venture Partners, plus existing investors Venrock, Vulcan and Ascent.

“We hit the inflection point where we have enough customers, enough revenue, enough partners,” CEO Russell Glass told me in a phone call. “We should continue to see profitability.”

One important component to Bizo’s positive balance: The company has landed many of the biggest B2B advertisers as clients. At the high end of the market, the money from any one deal is a lot bigger — potentially 20 to 40 times bigger — for the same amount of work

Bizo advertisers at the upper end of B2B spending include Verizon, Sprint, HP, IBM, Microsoft, Monster, Dell, Fedex, and UPS. But the company also serves the long tail of small advertisers. “You need to do both,” Glass said.

Glass also said Bizo’s recent $6 million in funding enabled profitability rather than hindering it. “As you get bigger and bigger from a revenue persepective, you’re actually owed more and more in the short term from your customers,” he said. “You’re sort of floating a short term load to your customers.” By using the funds to build out infrastructure and pay for bigger data bills, the company was able to secure and support enough business to be profitable. Sometimes you really do have to spend money to make money.