Keep Tumblr Alive! 4 Ways Tumblr Can Create A Profit

Filed as Editorial on October 29, 2010 8:49 pm

After surpassing Typepad and forcing WordPress to adopt a simpler approach to blogging, Tumblr’s greatest challenge right now isn’t adding new features, but rather becoming profitable.

Dennis Crowley, co-founder of location-based social network Foursquare, and David Karp, founder of microblogging platform Tumblr, talked about these and other issues here early Thursday in a conversation led by The New Yorker media writer Ken Auletta and organized by the Newhouse School.

While their companies have grown their user bases quickly and they have been developing revenue models, the bottom line is still a developing story. “Not profitable yet,” Karp told Auletta when asked about Tumblr’s financials. “Same thing,” Crowley added. (Hollywood Reporter)

Despite boasting a couple of premium features (such as paying to be listed in the directory and premium themes), Tumblr probably needs to figure out new ways to generate some positive cash flow in order to avoid the fate of Digg.

While the execs at Tumblr probably have numerous suggestions on how they could generate some extra cash on the side, here are a few easy ideas the micro blogging company could consider on the path towards profitability.

Affiliate Theme Program

While Tumblr’s premium theme market is a great idea, unless users are able to easily view the market place en masse the company probably will not generate enough revenue off of the sales.

Although Tumblr could aggressively promote premium themes via the dashboard (and perhaps risk a backlash from users), the company instead may want to consider partnering with their users via an affiliate program.

Tumblr could include a widget that users could place on their blogs and give users a small cut of the sale.

This would not only help Tumblr keep the lights on, but also encourage developers to create more quality themes (which would hopefully lead to more sales).

More Video Time Please!

While Tumblr does allow users to upload video files up to 100 mb a day (as long as they are under 5 minuets), the company may want to consider expanding the limit via a premium subscription (say $5/month).

Although users could always use YouTube, the latter only allows users to upload up to 15 minutes per video, despite the 2 GB allotment per video.

Tumblr could offer users up to 60 minutes of video time everyday, which would appeal to many of the aspiring film makers and celebrities that now inhabit the tumblverse.

The company could easily activate this feature from within their website or via their various mobile apps upon Android, Blackberry and iOS (the latter which supports in app purchasing).

Tumble My Domain?

While Tumblr probably probably has no desire to become a domain register themselves (like WordPress), the company would be wise to consider partnering with an established player like Register.com or GoDaddy.

Doing so would also have the helpful side effect of making the process of creating a custom domain more seamless, while at the same time helping Tumblr to generate some extra cash on the side.

Although it would be great in the future if Tumblr entered the domain registration field themselves (in order to keep most of the profit in their pockets), the company should seriously consider this move as some extra cash is better than no extra cash.

Promoted Search

Tumblr could once again take a cue from Twitter and allow companies to place their official Tumblr blogs in the top results in order to help them engage with the Tumblr audience (similar to Twitter’s Pay Per Trends).

While this measure would mean that the company would have to hire a sales team in order to attract interested advertisers, the company could benefit greatly by having its own ads instead of outsourcing to Google.

Any Other Ideas?

With Tumblr gaining credibility as a professional blogging platform, the company needs to find new ways of generating revenue as depending upon venture capital to keep the lights on may not work in the long run.

Are you a Tumblr user? If so, what premium features would you suggest the blog platform adopt? (and most importantly, what features would you be willing to pay for?)

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