The Comedy Don: "Super Deluxe had great goals," says comic Eugene Mirman, "but the goals were never realized." | photo by Matt Hoyle
Leery advertisers haven't even been lured by impressive traffic and proven content. When This Just In tried to sell ads against "David Blaine Street Magic 2," a sequel to a spoof that first appeared on YouTube and generated about 20 million hits, no advertiser bit. The sequel garnered another 10 million hits, but marketers had no regrets: They balked again when This Just In peddled ads for a third iteration.
Even in a best-case scenario, when a video does get advertising, a financial success is hard to achieve. Many of the comedy sites adhere to a studio structure, tapping a collection of outside talent and paying per video ($1,000 to $12,000 per piece, although some climb to $15,000 or $20,000). With a $10-per-thousand-views ad rate, not uncommon in this market, a video that attracts 1 million views -- a colossal hit -- generates only $10,000. That's often break-even at best. "It's almost impossible to make the numbers work," says Steve Stanford, This Just In's former general manager and now a partner in William Morris's Agency 3.0.
Family Guy creator Seth MacFarlane's much-ballyhooed deal with
As sites search for bankable revenue, "customized branded-content opportunities" -- making videos that feature an advertiser -- have become a lifeline for some. Unilever's Axe deodorant brand approached Funny or Die and paid the site a "high six-figure" commission to create content to help promote a new male-hygiene product. "The video is not about the product," Glover says. "It's about -- forgive me, this is the only way I know how to say it -- sweaty balls." It will air exclusively on Funny or Die for up to a week and then be distributed elsewhere. "This is the cash cow," he adds. "You have to sell a whole lot of banners to make up for this." The problem? "Axe body sprays can only sponsor so many things," as Stanford, unaware of the Funny or Die deal, puts it.
Honey, I Shrunk the Audience
Tremendous pressure to draw a crowd has also led sites into strategic errors that alienated viewers. This Just In, for example, was promoted on AOL's home page -- something that brought millions of hits. But "the AOL audience was not the best audience for push-the-envelope comedy," says Eric Spiegelman, former head of business and legal affairs at This Just In and now the digital chief at GreeneStreet Films. AOL linked to a This Just In video about a contestant in the Westminster Dog Show being caught in a sex scandal, but it labeled it as news -- not satire (oops!) -- and the site got hundreds of angry comments.
In Super Deluxe's quest for traffic, Turner did "ridiculous" things, says Gerard Babitts, who oversaw marketing at Super Deluxe. The company, he notes, made deals with at least 150 content providers as a way to attract everyone, rather than define its audience. "They didn't want to put their dick on the line." Turner also bought search keywords -- lots of them -- including "Britney Spears" and "boobs," which pumped traffic but didn't create loyal fans. "People who type 'boobs' into a search engine aren't looking for a comedy site," Babitts remarks drily.
"People who type 'boobs' into a search engine aren't looking for a comedy site."
At the same time, these companies have missed out on smarter online audience-building tactics. Turner sent cease-and-desist letters when Super Deluxe videos showed up on sites such as YouTube. Meanwhile, This Just In contributors independently posted to YouTube -- and saw remarkable results. "Condelicious," a hip-hopping Condoleezza Rice, got 2 million -- plus views. "It was the video that put This Just In on the map, and it wasn't on our site," says Craig Bowers, former director of marketing at This Just In. "The reality is, if someone hears about a video, they don't wonder what site it's on, they just go to YouTube." James DiStefano, Super Deluxe's director of user experience and community, adds, "The model was stickiness -- page views and time spent on the site -- but in the current paradigm, you have to be spreadable, not sticky."
Funny or Die, which recently received an investment from HBO (try number four for Time Warner, but who's counting?), is doing some spreading of its own. Glover has hedged his bets on comedy, rebranding the company Or Die Networks and adding such niches as Shred or Die, an extreme-sports site with skater Tony Hawk in the Ferrell role, and Eat Drink or Die, with celebrity chef Tom Colicchio.
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