This is the first time I've heard of a "fictional blog", so I'm guessing that a lot of people aren't familiar with the concept. That will make it more difficult to succeed. It's always easier to sell people something when you can say, "It's just like _______, only better." When you have to explain what it is you're selling, and THEN explain why they should want it, it's a pain for you and them, and it's much harder to find readers. It's just a fact of life. When you have a brand-new field, early adopters are going to have a tough time of it.
That being said, I'd argue that for the most part, your audience isn't going to be blog readers. I think the market you're after is novel readers -- you're basically publishing a new form of serial novel. I think it's a totally awesome idea, but the marketing for it will be different. You have to remember that most online writing sucks The reason the publishing industry is still thriving, even though it's the work of 10 minutes to get writing directly from the author to the audience, is that the vast majority of writers are terrible. This means that in a small field - like fictional blogs - it will seem like nobody succeeds, because there are very few people doing it, and most of them are terrible. It's true in non-fiction blogs also -- I would estimate that 99% of them are garbage -- but there are SO MANY people doing it, that the 1% that are worth reading seems like a huge number. Fictional blogs just don't have the volume yet, so it looks discouraging to you.
The good news is that your writing is already better than almost all of the stuff out there. The bad news is that people who come to your site have their cursor poised over the back button, waiting for the first sign that your writing isn't worth it. So, especially at first, you have to concentrate on writing as well as you possibly can, and improving your writing at every chance. I would have one or two dedicated editors, who will read your posts before they go up and ensure there are no grammatical errors (excepting those necessary for the story's flavor) and that the writing is clear. I would go to classes on fiction and non-fiction writing, to improve yourself. Unlike traditionally published work, where your readers can have some confidence that you're worthwhile because you made it into print, online readers will cut you very little slack. You have to remember that the majority of people won't like it Even with non-fiction blogs, a large percentage of the people on the web don't subscribe. I'm subscribed to 3 blogs right now. That's thousands of blogs (even "good" blogs in the top 1%) that I'm not subscribed to. I don't subscribe to political blogs because I don't care that much. I don't subscribe to financial blogs because I've passed the need for their advice.
You're in the same boat. Even if everyone who likes it subscribes, you'll still only have a tiny portion of websurfers - those interested in a British perspective of the US, and those interested in realistic fiction who like your story. I like your writing and think your story's good, but I won't subscribe, because I don't care for realistic fiction. You have to remember that it takes a long time to build up a blog following Certainly don't give up faith before the first year is up!
The only other thought I have for you is to consider starting several blogs (or one blog, but with multiple feeds) with different stories. Most writers have more than one story in them, and doubling your blog would double your chances to impress readers.
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