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uTip has been around for 3 years now. During these 3 years, the platform has been constantly evolving with a single goal: to help the content creators to make a living from their creation.
We are writing to you today to announce an evolution that may surprise you and that we therefore want to explain to you in detail.
After having thought carefully, consulting creators and TipRs, and following the impact of the current health crisis, we will definitely withdraw advertising from the platform on July 30, 2020.
An article from our FAQ has also been published to answer general questions and will be regularly updated to remain transparent.
The advertising market, its evolution and the health crisis’ impact
Some will probably remember a time when viewing an ad on the platform made you earn 5 cents. It was a time that we consider respectful when it comes to internet users’ attention time.
But it was also a time when advertising on the platform was scarce. Since then, with the growth of the community and our willingness to help support as many creators as possible, we had to align with the advertising market prices by joining ads networks to achieve a premium and large volume of advertisements at 1 ct / ad.
For us, this was a temporary alignment, allowing us to grow our audience to be better heard, and above all respected, by advertising companies. A provisional price reduction that would ultimately allow us to offer you more advertising at 5 ct in the future …
In reality, this is something that we were starting to doubt, as the online advertising market is dragged down, price wise by the giants Facebook and Google.
And then, COVID-19 happened. With the health crisis, all advertisers have cut their marketing budgets (why advertise for a car when being in lockdown?), And this, combined with a very strong internet global audience, has literally slashed advertising pricing.
As of March, advertisers have not paid a penny for an ad to run on uTip, but 0.05 cents. Half a tenth of a cent.
In March we then made the decision to bear this gap for you and to continue paying creators 1 cent per ad seen on the platform, hoping that the price rise will quickly recover.
This is not the case, and today we have two observations. The first is short-term: today we finance 95% of your advertising revenue and, with more than 200,000 advertisements viewed per day on uTip, we cannot continue without jeopardizing the existence of the platform.
The second observation is medium term: 1 cent per advertisement seen is an income that internet users and creators alike find very low. While this is a price point that already requires a huge effort from uTip to bear everyday – and which will become unachievable. Internet users therefore only watch advertising a few times before getting bored, and the creators consider the income too low compared to the effort required to convince Internet users to come to the platform.
These observations account for the start of our general thought about the place of advertising on uTip.
Advertising as a way of support
In addition to the above observations, there is a thinking process of several months around the platform and its evolution. By talking with you, creators, but also with TipRs, we had to face the facts: advertising does as much harm as good for the platform.
First of all, as we have seen, the realities of the advertising market have forced us to move towards a supporting tool where it is no longer enough to watch 20 ads to donate 1 $, but where you have to watch 100, or spend 50 minutes on a computer watching advertising …
We have embarked on this way of support with the desire to reverse the relationship between Internet users and advertising, to give it back its value while making it possible to support a creator “for free”. In this context, with these orders of magnitude (100 ads = 1 $, and even worse at the moment, 2000 ads = 1 $), we believe we have failed and are starting to have serious ethical questions about displaying so much ads for so little – even if it’s market price.
Another observation fed our reflection: advertising tends to shade the existence of all the other ways of support and tools available for creators on uTip. In particular, offering advertising encourages less use of other tools that have a greater impact on the life of the creator, such as donations and the shop.
In addition, the creators themselves know us through advertising, which overshadow other important tools.
For example :
- uTip is the only crowdfunding site offering to pool the donation to several creators in one single payment
- uTip has the only shops where you can sell what you produce and branded merchandise on the same platform
- uTip has a very powerful overlay allowing to display alerts in the event of donation or purchase made on the platform.
- uTip provides creators with a link shortener with more features than bit.ly
All of these tools, taken separately, can already have a big impact on the lives of creators who use them well. These tools are less relevant to the users because of the advertising which gathers all the attention but which, in reality, pays very little.
Advertising is not an effective support tool. This is the reason why we won’t be leaving the advertisement on uTip at its current market price (remember: half a tenth of a cent). We also want to remove it from the platform to shift our attention and our efforts on other much more promising tools.
In this period, we keep in mind our fundamental values: helping creators to set up their career, highlighting the value of their work and helping them to connect to their community. We simply believe that advertising no longer fits into these values.