What Online Publishers Can Learn from Game Theory

Last week I removed the banner and leaderboard ads from the top of my Surfnetkids.com site to see if my AdSense revenue would increase. I didn’t do an A/B split test, so other factors could have influenced my results, but I noticed that:

1) my pages loaded faster
2) my page views increased

While discussing a related topic with my colleague Jerrold Foutz (of SMPS Technology) he mentioned that “two game theory guys just won the Noble Prize for economics by showing that in repetitive situations (games), giving up short term gains to gain credibility pays off in the long run.”

Wow! This makes sense. A good website is a “repetitive situation” and giving up on the short-term gain of banner ad revenue should increase my credibility and good-will, thus resulting in better long-term results. Of course, this assumes that there are other long-term revenue sources, such as AdSense, e-products, affiliate income, newsletter ads, etc.

Jerry also shared this PDF link from NobelPrize.org about the game theory work of Robert J. Aumann and Thomas C. Schelling.

Thanks, Jerry.