Riayn made an amazing comment on Lightening’s monetisation post:
I can’t answer your exact questions because like you my blog does not have advertising, but since I work in online advertising I can give you a view of the industry.
Online advertising is really geared towards the advertiser, they are the big winners here. The publishers (ie you) really lose out in monetary terms. Most advertising for blogs and small publishers work on a pay per click or CPC basis. This is because whilst a large number of viewers will see the ad, a very small number will click on them - the industry standard is 0.05%. Therefore, for roughly 5 million impressions, there will be about 3,500 clicks. The advertiser still gets eyes on their ads, but don’t have to pay out as much as they would if they were paying per thousand impressions (CPM).
The industry is now moving towards paying per sale or CPA. This means you (the publisher) does not get paid unless someone who clicks on the ad shown on your site goes ahead and either makes a sale, signs up for a credit card or registers an expression of interest.
Back to my example, an ad which will register 5 million impressions and 3,500 clicks will only register about 50 acquisitions (sales, signups etc). The advertiser will only pay the publisher for those 50 sales.
It is a very poor way to make money especially for a blog that has a small readership. The big blogs do make some money from it because they are generating tens of thousands if not millions of views per day.
For those of us who are not A list bloggers, we might earn just enough to cover hosting costs and that’s about it.
Wow.
So , the question arises: is there money in advertising for we prebloggers (would-be probloggers who haven’t quite made it yet)? If you search technorati on advertising on blogs you’ll get more than 33,000 results - it is a popular topic. What follows is not a comprehensive guide to advertising for bloggers - but it does look at some of the alternatives.
Isn’t Google Adsense wonderful?
Possibly not. A lot of people dislike CPC (cost per click) advertising programs. While Google Adsense does do CPM (cost per thousand pageviews) advertising, their main claim to fame is virtually cornering the CPC market. But the public’s love affair with Google is slowly dying - they have screwed over non-US/Canadian/Japanese referrers and some people have left Google behind altogether.
The CPA (cost per sale) or affiliate advertising run by the likes of Commission Junction is worth trying for bloggers in some niches. I’ve looked at Commission Junction in the past and found it to be fairly US/UK centric - I do have some US/UK readers but the majority are Australian, and targeting ads to overseas suppliers is not ideal. There is a local variant - Commission Monster has an Australian program. I can’t recommend them personally - their application form doesn’t acknowledge the State/Territory I live in (ACT) and it took them 5 days to respond to an enquiry about the application process the first time. I put in my application a week and a half ago and I’m not confident of any response.
So, if Adsense and other centralised CPC/CPM/CPA advertising doesn’t really work for us, what does?
Leo Babauta from ZenHabits credits concentrating on advertising as one of the factors that allowed him to go pro. He manages his own ads directly and will sell you a 125×125 ad at the moment at $1 per CPM (thousand impressions) - see his ad page for details. Selling ads at a fixed rate per CPM is good value for Leo - he gets paid whether the advertiser gets a clickthrough or not, makes a sale or not. Applying Riayn’s hypothetical 5,000,000 pageviews a year to Leo’s blog at the stated rate would give him $20,000.00 from that source alone (multiplying 5,000,000 pageviews at $1.00 per thousand views by the four 125×125 ads on Leo’s blog) . This is definitely into small/home business territory.
Just on “advertise with us” pages - it is interesting to compare the advertise with us page at Problogger with Leo’s - Darren’s discusses the benefits of advertising with him (which look great, he has an astonishing readership) but no figures. There is also a thread devoted to advertise with us pages on the Aussie Bloggers Forum.
So what do we mere mortals with sub-four-figure-per-day readerships do?
Swollen Pickles recently discussed Scratchback Top Spots on the Aussie Bloggers Forum. Scratchback Top Spots is a do it yourself sidebar link ad widget - basically, people pay a small amount to be on the list, and as you get more money from other people the original ones move off. You can see it in action on Swollen Pickles’ blog.
Those of us who don’t believe that Google is Satan can pretend that we’re pros by having Adsense ads. While it doesn’t make much money, the ads are there. I can see where Darren Rowse and other big names are coming from when they bag Google (because it is costing them real money) - for me, a few cents here and there don’t mean a lot.
And while it isn’t about the money, there is always Entrecard. Entrecard has given amateur blog promoters like myself a hobby - and if nothing else, it has widened my readership over at On Blogging Australia.
The Answer
I’m not sure that there is a definitive answer to this one even for me alone. I run ads because it amuses me rather than any great income earning potential. There have been times when I could have used the money in recent months. If I was getting thousands of pageviews a day I would take a more active interest in which was the best deal for my particular circumstances (niche/target audience location/my location/my readership size). Until then, I will continue to play.
My biggest ad revenues come from Feedburner. As my subscriber count has risen to over 500, the revenues have gone up 100-200%. It’s still small potatoes compared to Leo’s 30,000 subscribers, but it’s not nothin’.
I have adsense too, fairly inconspicuously, and if my readership gets to where I am shooting for, it may turn into something.
The best are the sidebar ads, where I have been exchanging services and products for ad space. I have a scratch/back widget, but no one has given it a shot.
I am working on finding the right mix of products for my readership, and I’m not there yet.
Hi Stephen,
thank you for your comment.
Feedburner’s ad program sounds like a good one - I just subscribed to your blog to look at it specifically, and the ads are subtle - they don’t get in the way of reading your articles in Google reader, which was what has made me hesitate in the past.
Your sidebar ad setup is good and worth emulating - lots of niche-specific affiliate ads there.
From my amateur perspective it looks like you have things under control there
Thanks once again for sharing what has worked for you.
Best regards, Andrew
CPC and CPA advertising is a very sweet deal. But not for the overwhelming majority of site owners.
A website is real estate. Someone wants to use that property to benefit their business? They pay for the space. There is no onus on the property owner to ensure they profit from it. That is entirely dependant on the business running their business well.
We wouldn’t let someone park their lemonade stands on our front lawns, and the lawns of everyone on the street, and everyone on the block, and everyone in the the suburb for free. Why not? Because it devalues our real estate.
I’m not opposed to this type of advertising but I do object to the grotesquely inequitable benefits and investing my time and space in a business that does not recompense me fairly. If businesses cannot target their own markets when they set their advertising budget, why should I do it for them?
Just throwing something out there and hoping it will stick with a tiny percentage of people is a pretty poor marketing strategy. Unless, of course, there a millions of us working for them for free.
Am I just being bolshie, or does this state of affairs make us all look like chumps?
Hi Lani,
thank you for your comment. I’ve looked at Stephen’s site at Productivity in Context and am thinking about how I can do some of the same things.
Reading your comment, I think it is fair to say that we are basically fodder for the Google machine, generating content for them almost for free. You are right to be bolshie about it, we do look like chumps. A reasonable CPM rate through direct sales seems to be the fairest option, but like Stephen I will investigate options.
Best regards, Andrew
I wouldn’t say that we are fodder for the Google machine, per se, because until Adsense there was no alternative for the low-traffic blogger. It does seem to be a leveler, in a sense, in that anyone can get an account. If not for Google, there would be no way for a newbie to get any sort of chance at ad revenue.
Now, of course, there are lots of ad widgets around, some better than others. The only thing that you can do is try them, see what works and what doesn’t. See what your readers like and don’t like.
Real-life example: I tried Widgetbucks, but the badge and the widget were too animated. I received 7 emails from readers complaining about it. Now, that is about 1% of my subscribers, but I honestly care more about my readers than the ads. Besides, I make more money from selling the calendars that I have designed than from all of the ads put together.
I agree that it is some ways a leveller, not just for site owners but also for smaller advertisers but it is very strongly weighted in the advertisers favour.
I should mention that monetisation is something I’m only beginning to look at and testing different services is definitely what I will be doing. In the end though, I think that if my monetisation is to be successful, I have to run my “business” the way I expect others to and create a space which is of value to the kinds of advertisers I would like on my site. Which essentially means creating a space which is of value to my readers.
But I’m an idealist.
Hi Stephen,
thank you for your comment. I will respond to your email as soon as time allows - which may not be for a little while, sadly.
I think that “fodder” is too strong a term. I become cynical at a multi-billion dollar corporation wanting to increase its market share.
I agree that, in the longer term, satisfying readers is more important than a dollar here or there.
Best regards, Andrew
Hi Lani,
sorry it has taken me a few hours to get back to your comment
I, like you, hate feeling like a chump.
I too have this scary thought that I need to believe in the ads that I run - that they not only have to be inoffensive, but actually add something of real value to the site and to the reader.
Best regards, Andrew
I agree that Adsense is a good way for people to get a start with a small blog, but the payment threshold means that it can be a long time before you actually see any money. I would ideally like to only have ads that I specifically choose for my site, but I imagine it would take a while to get to a point where I can organise ads directly. Everything is stacked in favour of the advertiser with small publishers having to jump through a lot of hoops to actually see any money in their pockets. As Lani said, why are we all prepared to offer our real estate for free? Ok, some real estate is worth more than others but there are pricing scales for that. I´m sure I´ve seen this written elsewhere (probably on the AB forum) - Every impression from Adsense or whoever is exposure for the advertiser, just like in a newspaper or magazine or on TV. Those media outlets are not required to prove sales in order to get paid.
I am in the experimenting phase, but I have to say I don´t feel confident of making any real money from it, the odds are against me!
Hi Guera,
thank you for your comment.
I think that there are a few of us who feel the same way. I’m pretty sure that if enough people get annoyed about this then a solution will present itself - there is a market opportunity going begging
Best regards, Andrew