What it is: Pheedo enables advertising inside RSS feeds. In English, that means Pheedo signs up marketers and publishers to put ads inside news and other content that a user has pre-selected to be sent to the desktop on their RSS reader.
How big? Custom media research firm PQ Media estimated RSS advertising (which only began in mid-2005) revenue at $650,000 for 2005. That compares with $16.6 million generated by blog advertising, and $3.1 million for podcast advertising.
How it works: Pheedo has two products, an original "Ads for Feeds+" and a just-announced "Ads for Feeds" that has fewer bells and whistles but is easier for publishers to put ads in content feeds. The original product does offer more analytics (because Pheedo is hosting it), and allows a wider variety of ad models.
Who's using it: A demographically desirable, but small in number group of consumers so far. The tech-savvy young, educated and well-paid typical RSS feed user still only represents from 6% to 14% (depending on which study you believe) of all Internet users. Yahoo says the number of RSS users are higher when taking into account the "unaware RSS user" who uses such tools as My Yahoo. Ad rates run between $5 and $15 cost per thousand, with a special program costing more, about a $40 CPM.
Too soon? Maybe. Some marketers already using the service -- including Nikon, Microsoft, PriceRunner, Hewlett-Packard and Suburu -- are learning from its use (as are publishers including Economist.com and The Gadgeteer), but ad models, formats and standards are still evolving. Today, an ad served via Bloglines will look very different from one served in My Yahoo. Also there is some blog discussion/concern that putting ads inside feeds causes readers to drop the feed.
What's next: Pheedo VP-Marketing (and founder) Bill Flitter said he expects RSS advertising to grow quickly because the medium already has a "blueprint" from lessons learned from e-mail advertising. He agreed that because it is easy to unsubscribe from an RSS feed, publishers and advertisers will need to experiment with ad placement and quantity to avoid drop-offs.