Before you dismiss blog advertising as a fad, consider that the number of blogs doubles every five months, according to Debbie Weil, author of The Corporate Blogging Book: Absolutely Everything You Need to Know to Get it Right (Penguin Portfolio, August 2006).

An estimated 80,000 blogs are created every day, and by the end of the year, the total number should top 80 million. Bloggers are influencers and insiders—they are at the forefront of word-of-mouth marketing, and advertisers ignore them at their own peril.

We talked to several experts to create a step- by-step guide for those of you who have not yet jumped on the blog advertising bandwagon.

Finding blogs
Finding blogs related to your products or services is a simple matter of entering some key words on a blog engine like blogsearch.google.com, technorati.com, or bloogz.com. But hundreds of results will likely pop up, so be prepared to do some research. You’ll need to read each blog to see if it’s relevant. (Another other option is to conduct a search using your company’s name to see who is talking about you.)

“Think of a blog as a conversation. An advertiser needs to join that conversation, not interrupt it with irrelevant ads,” said Bill Flitter, founder and VP of marketing at Pheedo, a blog and RSS marketing company. “Companies need to truly understand what the conversation is about and how they can participate as a third party.”

To illustrate the importance of choosing blogs carefully, Flitter gave this example: “We put the brakes on a situation where a gardening advertiser aiming for a certain demographic wanted to put an ad on a cooking blog. The product was a pesticide, so even though the demographic that company wanted to reach subscribes to cooking blogs, it was not a good fit.”

Not everyone has the time or desire to find the right blogs themselves, which is where agencies like Google AdSense, Pheedo, and CrispAds come in. They coordinate activities between advertisers and blog publishers, crawling blogs for content to make the best possible matches based on criteria established by the advertiser and blog publisher. Brian Axe, group product manager for Google AdSense, said his company offers three advertising packages. The first he calls an out-of-the-box experience: an advertiser sends in an ad, and Google’s automated system searches its content network to find relevant matches. Your campaign will be more targeted than if you used a newspaper or broadcast medium, but you can—and should—dig deeper.

The second option is a blog site pack, which allows a company to target all blogs covering a certain topic. The third is customized and more powerful, allowing companies to hand select the blogs on which they’d like their ads to appear. For instance, if your product is an iPod accessory, you can target five or 10 of the most popular iPod blogs instead of placing your ad on a vast network of tech blogs and hoping an iPod user comes along.

The most important thing to remember when choosing the right blog is that the days of mass marketing are over, said Flitter. “Advertisers should not be focused on putting up a blog ad to reach a million people. They should focus on putting ads on specific blogs to reach the right 1,000 people.”

Using key words
Once you’ve chosen the route your ad campaign should take, it’s time to think about key words. The experts concede that contextual ads aren’t the way to go. An automated contextual ad network can display off-topic and sometimes offensive ads because the content on blogs varies so widely (you don’t want an ad for top-of-the-line kitchen knives to show up on a crime blog). Many agencies allow blog publishers to choose their own key words to prevent certain ads from popping up and to optimize their income.

For instance, Hans Chung, co-founder of CrispAds, a blog advertising network, said his company oversees the advertising on several celebrity blogs, but key words such as “Paris Hilton” or “Britney Spears” weren’t generating much income, so blog publishers replaced them with words like “chocolate” and “hand bag.” “Those key words don’t actually appear in the text. You could spend a million dollars in contextual advertising and still never find the word chocolate on a celebrity gossip log. Yet that audience is an audience that will buy chocolate.”

Tracking ROI
Tracking conversions (how many visitors purchase a product or service), clicks (how many people click through the ad to your site), or impressions (how many people see the ad but don’t necessarily click on it) are all effective ways to gauge how successful your campaign is. Unfortunately, none of these measurements are easy to get, and most agencies don’t offer tracking tools. Those that do can’t supply their clients with much more than rudimentary statistics. Google, in contrast, offers an array of sophisticated analytics at no charge.

Tracking your blog ad campaigns will help you identify which blogs are the best fit for your ads, but Google’s Axe has words of warning. “The results can be misleading because a lot of it has to do with the placement the blog publisher gives the ads. You may not be getting many clicks on a particular site due to poor placement, but it could be a good match for you.”

The fix is to bid higher. Companies can choose to pay per click or pay per impression, and the more they choose to spend, the higher up on the page the ads appear. “You may find a valuable site that you want to pay $10 for every 1,000 impressions. Another site might not quite reach your audience, so you’d only be willing to pay half that,” said Axe.

The cost of blog ad campaigns vary greatly depending on the breadth and industry. Flitter has seen pay-per-impression prices range from $5 to $50 per 1,000 impressions, and cost per click prices can fluctuate between $0.05 and $0.60.

Getting creative
When designing an ad, keep in mind that your objective is to catch the eye, not offend it. A blogger will reject an ad if it is obnoxious. Think subtle.

Most blog ads, like those hosted by Google, are simple text, so don’t expect much control over the look. Blog publishers dictate the size, color, and placement of the ad, but fear not—they want your ad to succeed as much as you do. The more people click on the ad, the more money the blog publisher receives. And text ads are just as successful as graphic ads, if not more so. In that format, an advertisement acts more like an informational tag-on than blatant marketing.

Google has good advice for blog publishers when it comes to choosing size and color to keep readers from glossing over anything that is separate from the main content of the page. According to www.google.com/support/adsense, the goal isn’t to confuse users into thinking ads are content, but to get users to see and read the ads so they can click on those that interest them. The company recommends choosing several color palettes similar to those the site already uses and rotating them often. Bloggers who visit a site day after day may become accustomed to the position of the ad and not even see it after a while.

The shape of your ad, which will appear in the side margin or in between blog posts, can have an impact on how your customers react to it. Google suggests wider ads, about 300 pixels by 250 pixels, suggesting that wide ads are more reader friendly than taller ones because readers don’t have to skip to the next line every few words. Flitter has contrasting advice, saying that taller ads are better because blogs are read more vertically than horizontally, so the ad moves down the page with the reader’s eye.

Whether you choose text or graphics, be prepared to change your ad often. Blogs are updated frequently, and advertisers need to stay relevant. “Campaigns fail when an advertiser has one piece of creative for 30 days,” said Flitter. “We encourage people to give us at least two creatives to rotate each week. It’s more of a burden than your traditional ad network, but it’s highly effective.”