StumbleUpon Ads: Changes Coming to Unique Revenue Scheme

Social discovery engine StumbleUpon has one of the more original ad models in the Web 2.0 set. For every 20 or 30 Web pages users turn up when they click the “Stumble” button on the toolbar, they get one page that is a paid result.

Now the eBay-owned service plans to extend those ads to a wider audience by offering a toolbar-free way for people to use the service. It’s also ushering in a partner program to allow individual Web sites to offer StumbleUpon on their properties. That program launches this fall with four partners: HowStuffWorks.com, HuffingtonPost.com, National Geographic.com, and Rolling Stone.com.

The changes are part of a push to expand StumbleUpon’s active audience — currently about 6 million — as well as its year-old ad offering.

Ad enhancements over the next year will include making recommendations on specific categories where an advertiser’s content may do well. (Most StumbleUpon advertisers are media and entertainment companies.) Improved analytics will show how that content is being received.

Additionally, the company will hire in business development and direct ad sales. The self-serve ad system was launched a year ago without fanfare, and has grown organically to date.

StumbleUpon currently has “tens of thousands” of individual ad buyers delivering paid page placements into the browsers of toolbar users. While that list includes silverbacks like Condé Nast, Scientific American, and Forbes, the majority of its advertisers and revenue comes from the long tail — including sellers of desktop wallpaper.

All advertisers pay a flat five cents per impression ($50 CPM), and the minimum bid is in the $20 range.

StumbleUpon says users display a high degree of satisfaction with its paid results, with approximately 75 percent drawing a thumbs-up rating, compared to an overall favorability rating of 85 percent for its non-paid “Stumbles.” Even so, the company’s disclosure policy may raise the hackles of some consumers, because a person has to roll over a small icon on the toolbar to learn whether a page is sponsored or not.

The new partner program, called Partner StumbleThru, will let Web sites working with StumbleUpon to offer a private version of the service on their domains. It launches today on HowStuffworks.com and HuffingtonPost.com and will appear on other sites in the coming weeks. StumbleThru is a cross-promotional program between StumbleUpon and its site partners, and therefore doesn’t involve ads or payment of any kind.

“We hope a number of those users become registered users,” said Michael Buhr, general manager of StumbleUpon.

StumbleUpon’s other offering allows Web users to experience the service without a download, which it hopes will convince some privacy wary users to give it a try. To use the beyond-the-toolbar version, people must first visit the company’s redesigned Web site.

StumbleUpon says it has experienced inventory growth of 250 percent this year, with a total of 350 million pages delivered in August.