Here are some fun numbers for all you bloggers out their. Last week I was having a conversation with Andy from Saving to Invest about our blog readership and our goals for this year.
That discussion led me to take a look at just how much money there is in the personal financial (pf) blogosphere.
My first question was “what is the value of each reader?”
To calculate an estimated value of each reader I decided to use the number of RSS readers to establish a common measurable indicator. To get a fairly good estimate, I looked at the popular blog ‘Get Rich Slowly’, where J.D.’s article in Nov 2007 states that he had approximately $5k in income with 35,000 RSS readers.
I realize the that readers from J.D.’s RSS feed are probably not clicking on his ads and generating a lot of income, but the number of direct readers that are generating revenue are probably proportional to his RSS readers.
With this information, each RSS reader is worth, $5k/35000= $0.14 per month.
This is probably a low estimate since most blogs don’t have nearly as many RSS feeds and have many ways to produce revenue, but as a starting point I’ll use this number. I have done some other calculations and found readership to be worth up to $1.83 per month.
My next question was “what is the total revenue generated by the pf blogosphere?“
To get an estimates number of RSS readers in the entire pf blogosphere, I found Madison’s list of the top personal financial bloggers on her blog My Dollar Plan.
Madison has a list of the top pf bloggers for the months of January, February, March and April of 2008. With the help of a spreadsheet, I used this information to calculate the total number of readers in each of the last four months, and then multiplied by the value of each reader as calculated above.
Total revenue in the pf blogosphere:
At this rate, the total yearly revenue generated by the pf blogosphere will reach over $500,000 this year. If this is calculated with the $1.83 per month value per reader, the total revenue would be $8.5 million. My best guess would be about $3 million.
I realize that this estimate only accounts for the top pf blogger and there are hundreds of other pf blogs (like mine) that are not included, but looking at the distribution of top pf bloggers shows that they are earning about 98% of the revenue.
Revenue of the top 78 pf bloggers:
Another interesting question is “what is the growth rate of the pf blogosphere?” This interesting piece of information that can also be extrapolated from the monthly increase in readership.
Total growth rate in the pf blogosphere
The average growth rate of the pf blogosphere in 2008 is 9 percent per month, or 108 percent per year
. This is an astounding number, especially with the economy in a recession. In a boom year maybe this trend would be negative, but this is definitely a good year to be a top pf blogger.
Now before you run out and start a pf blog, keep in mind that the average pf blogger only makes about $100 per month while investing 20 hours per week - which comes to $1.25 per hour.
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