We ran several studies over the past several years around website revenue statistics, starting with our website revenue study in 2012 and the follow-up study we ran in 2015. In the interim, we've also done a lot of A/B testing on our own websites including building our own ad server. Across all of these studies, it became apparent that there was a big gap between the "best" and "worst" sites, even within similar categories and revenue models.
As part of the website revenue study, we collected data on about 100 websites which were sold at public auction. The circumstances of the sale allowed us to do some basic due diligence around the revenue model and claims. We were able to validate earnings, sort the sites into similar groups (by niche and audience buying intent), and calculate some statistics. In this case, we looked at the range of revenue per visitor for sites serving similar niches and audiences.
Source:website revenue study, 2013 - 2015
This difference is not luck. Its advertising strategy.
There were common themes among the stronger sites:
Let's remember what pays the bills here: you must connect a website visitor with a merchant they spend money at. This online advertising business isn't about clicks or impressions or eyeballs or leads - it's about sales. Any scheme that generates the former without the latter is doomed to a short existance. The difference between being a publisher, affiliate marketer, and an online merchant comes down to how much ownership you take over this process. Since greater ownership involves effort and risk, hopefully offset by greater rewards (if you don't screw up) - you should focus on the pieces you know how to manage.
There are a couple of basic activities occurring here.
Incidently, each of these steps needs to be executed appropriately. The mix of information provided to a customer should evolve at each stage, along with the nature of the call to action and (gentle) selling pressure. The consequence of screwing this up is the customer will shut down (mentally), hit the back button, and move on to the next source. This is a space where small details matter immensely, in terms of what % of your customers move along to a sale, and if you're not willing to invest the time to get this right, it makes sense to take a narrower role in the sales process.
We laid this guide out in several sections, so publishers and marketers can pick how much of the process they want to take ownership of. The good news is most sites can find *something* that will help them improve their results in this guide. At a minimum, check out Ezoic ('done-for-you' AdSense optimization for publishers), which is the easiest option we describe (and often delivers a 50%+ lift in advertising revenue). For those of you who want to go a deeper, we cover topics like DIY ad optimization, incorporating additional ad networks (alternatives to AdSense), and building your own selling process (to promote affiliate offers or your own dropship or infoproducts).
I like AdSense for their pure simplicity. Google has taken the complicated act of matching advertisements to website traffic and reduced it to a very simple cut and paste. If you can get approved for AdSense and can comply with their policies, go and run their ads. From a revenue perspective, they will beat most automated advertising options.
Speaking from personal experience, optimizing my page layouts to improve AdSense revenue and user experience was the highest value activity that I did during the first three years of my business. We've done four large waves of design optimization on our primary site and averaged a 50% lift in revenue from each project. These projects improved revenue-per-page, pages-per-visit, and overall traffic. The three are linked - you need to balance the revenue from placing more disruptive ads on a page with the impact on user engagement and search engine rankings. It's also good to assess how likely your design will generate "unintentional clicks": reducing "bad" clicks will improve your AdSense quality ratings, increasing your revenue per click. Our best project involved redesigning our mobile layouts to improve user experience and reduce bad clicks; we earned slightly less per page but tripled our mobile traffic over the next year from lower bounce rates, more repeat visits, and better Google search rankings.AdSense optimization is also a much easier skill to master than affiliate marketing. It involves using what you know about Web Design and Google Analytics and using statistics to critically evaluate the impact of small changes. You may need to learn a little about responsive design and advertising best practices. It is also fairly easy to outsource the technical and design elements to an expert (services exist).
Let's start with a critical evaluation of AdSense. Here are a couple of situations where AdSense really excels, relative to other advertising models:
The common theme in the situations above is the level of effort required to build a productive sales funnel around a specific affiliate offer likely outweighs the expected return. Building a good affiliate offer takes time (to create content) and traffic (for A/B testing your concepts). Unless their traffic is highly targeted and easily linked to an offer, standing up a good affiliate offer for a small site can be a challenge. On a similar note, it can be a significant challenge to match a highly relevant affiliate offer to a super-diverse audience (we've been struggling with this on one of our properties). AdSense uses Google's data to overcome this. And finally, if the sales process is too complicated to close in an online transaction (affilate marketing) or inbound call center (lead gen programs), AdSense gives you a way to hand the opportunity off to someone with the resources to execute on it. In each of these situations, it makes a lot of sense to use AdSense and go back to building great content and increasing your traffic.
At a strategic level, AdSense's strength is the ability to deliver decent results on a highly automated basis. This gives you a way to set up a revenue strategy at a very low cost-per-site. If you're managing a portfolio of small sites, this is a very fast way to get a revenue model in place. The optimization process has also been automated, through a service offered by Ezoic, giving you a low-cost way to execute this across a portfolio of small sites.
For those of you who are already using AdSense and want to make more money from your website, a good first step is to look at optimizing where you place your ads. Here are some good starting points for optimization:
I've run many AdSense optimization efforts and the best opening moves always comes down to getting the basics right. By shifting your ads to the standard sizes, you are increasing the number of advertisers who will potentially bid on them. More bidders translates into a higher auction price. You should also set up your ad slots under different tracking codes - this allows you to see which parts of the page are getting viewer attention and clicks. Pay attention to the "% active view viewable" metric; if the ad slot isn't usually visible, it probably won't deliver much revenue. As a general rule, you should try to run 3 AdSense units on a page. But this may be worth testing.
If your site gets a lot of mobile and tablet traffic, you should repeat this assessment for different screen sizes. The standard AdSense reporting gives you results by "Platform", including click rates, earnings, and % visible - this can be invaluable in optimizing a size. If you spot one area or ad unit underperforming another, take a look at it on that browser size. A good way to see this is to use the Chrome browser's "More Tools" => "Developer Tools" option to see how your screen renders at different browser sizes. This was significant for one of my recent projects - while the site was performing well on desktop and table, mobile was poor (bad visibility). We wound up redesigning the page so it cleanly displayed all three ads in the mobile view. This translated into a big boost in CPM's for mobile traffic (~30% increase\).
Advanced optimization gets into page layout, ad sizes, and color themes. Effective placement and color schemes comes down to balancing small differences in contradictory goals. To be effective, the Ads must be similar to the content on the page (otherwise, ad blindness kicks in). But at the same time, ads need to be sufficiently different from the adjacent content to casually attract the reader's attention. Sound confusing enough? The process is a subtle balancing act. The best approach here is develop a couple of different concepts and run many, many tests (Google A/B testing to the rescue). While this can be very rewarding, expect to spend a decent amount of time setting up and tweaking tests.
It's a good idea to let an AdSense test run for several days before measuring it, especially if there has been a significant shift in click-through rates or view time. This is due to two factors. First, repeat visitors to your site will develop a routine usage pattern and learn to ignore ads in the regular places; moving the ads around will often produce a bump in the first 24 - 48 hours as your regular users notice them again and start to adjust their patterns. Second, AdSense has a safeguard to prevent publishers from profiting from bad clicks known as "smart pricing". If you have a sudden change in site behavior (more clicks, different page views, etc.) your value per click will drop significantly. If the change was legitimate and your visitors continue to perform well for the advertisers, your cost per click will revert back within a couple of weeks. But give the test a little time so you can work through the initial response from AdSense.
There's a delicate balancing act between ad placement and user experience. Placing too many ads will turn off your users and cause them to leave the site early (less pageviews and thus, fewer ad impressions). It's also good to remember that user experience plays into SEO rankings; so improving metrics such as bounce rates, pages per session, and average pageview time can result in higher traffic. This is where using the "experiments" function in Google Analytics helps. You can test multiple versions of the page and see which one delivers the best total revenue and user metrics.
If your site makes at at least 15,000 visits per month, it's worth doing at least some level of AdSense optimization. A company called Ezoic set up an automated version of this process they offer as a service. Their automated platform runs tests to identify the best combination of AdSense settings and ad placements to use for your page. Ezoic is a Certified Google Adsense partner, which gives them some lattitude in how they manage the program - they can run additional ads (5 total) and can help with AdSense account approval problems. It's easy to implement, can be tested for free, and clients report revenue increases of 50% or more. For more details, click here.
Welcome to our discussion of alternatives to AdSense. Allow me to begin by politely inquiring why you're here....
Before we dive into this topic, if you're fully compliant with AdSense and want to make more money without much extra effort, look at AdSense optimization first. AdSense is THE 800 pound gorilla in terms of ad performance. They simply have more data and more leverage over their advertisers than other participants in the space, particularly for small publishers, which translates into higher ad revenue. So if this just about the money, read our AdSense Optimization guide or check out Ezoic's automated AdSense optimization service. Ezoic is a Google Certified AdSense partner and clients report gains of 50% - 200%. (you also don't need an AdSense Account to Apply; they may be able to help sort out past approval problems). If you're an established publisher with a clean AdSense profile, this is the most effective way to boost earnings short of investing the time to build a process to promote affiliate marketing offers.
Ok, for those who remain, I'm guessing there are two camps:
Lets face it - there are certain ad formats which are just more effective at engaging a customer than a pretty little text box. There are certain ad placements and content types which big brands just won't touch but good marketers LOVE because they are just more effective than a simple sidebar banner on a long blog post about my dog's pet cat. Maybe we even need to rotate an ad or deploy a pop-up or get close to a application button without violating compliance rules. Obviously, if you're depending on SEO for generating most of your traffic, be cautious about running these ads on your landing page (popups and other tactics can affect search rankings).
Media.net is a contextual ad provider sponsored by Yahoo and Bing (Microsoft). I've run several tests of their program over the past year and developed a good feel for the pros and cons of their offering. From a pure financial perspective, they deliver good results, easily the 2nd best managed advertising program I've worked with. I have also found them extremely trustworthy from a quality and security perspective - advertisers are carefully screened and they use a two-click system that limits advertiser code running on your site. Setup is easy (equivalent level of complexity as AdSense).
Relative to AdSense, they require a lot more management. While Google tends to be difficult to contact, they do an amazing job of designing the service so you rarely NEED to call them. Pretty much every major account decision on Media.net (including basic stuff, like signing up for display ads vs. text links) requires talking to an account manager. On the phone, not email or chat. With key approvals being queued off to a higher power for approval. They are oriented towards serving large sites.
The ad unit itself was a set of text-links, each link a specific term that was supposedly related to the content of the site. These led to a second page listing advertisers relevant to that term. Overall results were solid. My one complaint was the text link box stayed close to the keywords on the page and rotated through a small list of terms; this works very well for a blog or reference site with lots of short term traffic but got stale on my site (lots of repeat users, rotating through ads that are very relevant to our demographic targeting often works better on our site). Responsive design support is a gap; you cannot implement AdSense-style resizing, which limits how you can support mobile users (short of redirecting them to a mobile site). Their media unit is rather nice, with a floating footer at the bottom of the page. There's some concern that this may be a TOS violation with AdSense units on the same page.
If you've got a blog or site with a large amount of text content, Infolinks may be a great fit. They are a pay-per-click advertising network which provides a widget that identifies certain keywords in your blog posts and adds advertising links to those articles. The intent is for it to scan the text of the article and seamlessly integrate appropriate advertising. Infolinks is great when you're trying to build up a page's advertising from multiple sources, particularly for a long text article such as a long blog post. Run Infolinks, AdSense, and a good display ad provider like media.net. Now you've got three networks working to build up your revenue per page. Infolinks free to sign up and simple to implement. Highly recommended for testing on blogs and other long-text content sites. Click on the banner to learn more.
If you've got the traffic (50K/month), Adversal is a good first step after Adsense. They are a CPM display advertising network driven by a real-time bidding process. There are two huge advantages to this, from a publisher perspective. First, speaking as someone who hates text-link blocks (the usual AdSense alternative), their ads look pretty dang good. You can integrate their program into the same slots you ran AdSense in. They have access to several formats that AdSense doesn't support (Popups, Ministitials) which will generally offer higher rates than traditional banners. You are able to run them with other advertising networks subject to a limit of 6 ads (total) per page.
Another well respected option, Chitika has been active in the industry for many years. Yahoo set up a major partnership with them in 2010, where Yahoo phased out their self-serve ad platform and selected Chitika as their prefered ad network for small and medium sized publishers. This particular program is interesting because it targets ads based on the search engine terms that are frequently used to bring visitors to your site rather than the specific content on the page. Think of it as being similar to search engine keyword advertising, just placed on the website. The program works best if the website enjoys a decent volume of search traffic, particularly if it ranks for multiple keywords that can be linked to a commercial topic. Look at using it for blogs and articles, particularly those where the search engine is ranking the content. On the positive side, it can easily be run on the same page as AdSense ads without any policy violations and is a good way to bulk up your total advertising volume on a long blog page or reference guide. Definitely worth a test if you have search engine traffic.
We recommend using ShareASale as a starting point for your affiliate efforts. They are a large, stable affiliate program exchange with a wide variety of merchants and offers. Their system is easy to work with and has excellent reporting and tracking capabilities. The signup process for new publishers (see banner below) is free and allows you to take a deeper look at the merchants and offers they represent. Highly recommended as a first step for readers interested in testing affiliate marketing.
Amazon's affiliate program gives you the ability to promote any item in their online store via an affiliate link. If the item sells, you get a % commission based on an increasing sale (more sales => more commission). This is a straightforward option for beginners to use to get started.
I also use Amazon links as a quick way to test the product-market fit for ideas where I haven't picked on a product; for example, I wanted to test if the audience for one of my sites was interested in a particular topic. We whipped up a quick banner ad (using the Paint editor, of all things) and linked it to an Amazon e-book related to the topic. If it had been successful (many clicks), that would have been a signal to find a better deal (or go write my own e-book, knowing I could deliver an audience of potential buyers). In this particular case, we learned that the idea was good in theory but didn't generate real world interest. 15 minutes of testing using Amazon as the stand-in product easily saved us 15+ days of wasted time developing a product that nobody wanted to buy.....
The mechanics of how advertising works is a fascinating topic. Particularly the really broadly distributed stuff - like TV spots, radio, and YouTube video ads. Basically, you get 5 seconds of someone's time...and if you're really good, they'll listen another 30 seconds until the spot is over.
Once the ad is finished playing, the advertiser has two huge risks. First, the audience may flat out not need the offer. Not having more kids? Then you're not buying baby food. NEXT! Second - they may not need it right now. A vacation sounds fantastic but the wife has us booked for the next two years between family visits and stuff we've already bought. Try again later. So most of those messages fall on deaf ears.
The one saving grace that keeps the industry alive is that for certain brands, it's profitable to carpet bomb the airwaves with their brand logo / mascot. This has the advantage of soaking up most of the remaining space, with low revenue-per-impression advertising to flash an image which never get directly clicked or responded to. I'm not clicking on my grocery story banner especially since they intentionally didn't offer a coupon). I'm probably not clicking on some political candidate's ad either. Both of those exist for name recognition and run very cheaply.
But what if...we knew what the listener was interested in? You, for instance. Given the article you are reading and how folks usually find it, I'm fairly comfortable you're interested in how websites make money. Which tells me you either own a website, plan to, or generally very curious about an online business topic. Which suggests a universe of products that most of you will likely need at some point in your quest, some of which have merchants with affiliate referral programs. So promoting one of THOSE products has better than average odds of getting a click, since I know that 50%+ of the readers of this article are going to likely buy that product at some time.
We can go one better. A small fraction of Google's search queries indicate the searcher not only has a need but the time to buy is NOW. "Emergency Dentist in Austin" is probably solid gold and the first link to any dentist appointment booking service will no doubt be clicked, credit card in grateful hand. While the odds of ranking for this particular query is low, the same idea does apply to articles and guides related to solving a specific problem or helping people with a very specific concern. Product reviews are another good example - people rarely go looking for reviews unless they are seriously considering buying the item. Present the reader with a a well written review of the item and a link to purchase it, you will start seeing clicks and sales from the link.
For those of you who really want to excel, there's an art to where and how you place the link on the page so you visitors can see it. The better a job you do of this, the more likely the visitor will convert into a sale at the merchant. The best referrals are from pages where the merchant's ad is supported by the content - either something direct like a product review / feature or even "intelligent targeting" where the affiliate banner is placed next to related content (hosting ads next to an article about designing websites). Ideally the affiliate "warms up" the referral so they understand what they are being shown and why it's relevant to their need. There's a lot of value in this - ace marketers can improve their results by as much as 10x through studying their sites and regularly testing improvements. But you've already got a great head start on beating the ad-picking robot if you focus on relevant offers and give the offer some support in your content.
Let's face it - humans excel at matching people with the right products. Because we often use them too. Think about a website about a new TV show. Most of the time I visit, I get shown big brand ads or video clips about other TV shows. But a human knows.... the TV show was adapted from a book, which most of the audience hasn't read yet (AMAZON LINK!). And that many fans like to wear t-shirts from their favorite shows (t-shirt / apparel store, possibly aimed more broadly at my demographic). And probably there are a couple of things that people in my demographic (nerdy sci-fi fans) can be sold as well - so promote those banners on the site and leave the cheap Sears Ad for someone else to run.
There's a common theme across the sites which were in the top quartile on revenue. They made a serious effort to use their knowledge of their site's topic and their audience to find a relevant offer. You shouldn't be flashing me a picture of some random nursing home on that TV show website: send me to Amazon to buy the book, flash a picture of a cool t-shirt for the show, show me a geek gift or a video game. You KNOW what I like. Sell me something I actually want.
The really smart ones had this down to a science. They brainstormed many different offers and tested them to see which ones the audience wanted to explore. Then they tried different ways of presenting them to me. When I clicked on their banner, they had a well thought out page explaining why I should go ahead and buy. For really big purchases, the smart ones figured out that I wasn't going to buy today and asked me for my email address and made an effort to build up a relationship.
Marketing optimization involves putting some human thought back into the process of matching visitors and offers. Using our understanding of the audience and the topic to design a process for identifying which visitors are interested in a particular subject and matching them to a relevant offer. Helping them fully understand their needs and the value of that offer to them. And guiding them to a point in the conversation where they want to say yes to that offer.
The first time I tried this, I was blogging about a new piece of software. I wrote an article that helped new users solve a couple of problems with setting up the software. My article got noticed by Google and visitors started coming to read it. I even placed an ad on the page - the advertising network scanned the text of the blog, realized it was about a software topic, and started displaying technical ads.
Thinking about it a bit more, I realized we were speaking with people who were SETTING UP the software package for the first time. Having gone through the process myself, there were several services that a typical user needed to buy. We included links to reputable merchants who could help them. A fraction of our readers clicked on those links. Some purchased. We earned a commission on those sales. The whole process was actually viewed as a service to the readers - we were directing them to things they needed to complete their project.
When we did the math a couple of months later, we realized that for every dollar we were making from the ad network clicks, we made $12 from the affiliate referral deal. All for identifying a service that was highly relevant to the topic we were writing about and directing people to merchants who could help them. Best of all, we were able to run both of programs on the same page without violating any ad network policies. The referral revenue was pure profit.
The technique we're discussing is referred to as affiliate marketing. You partner with a merchant (usually a store, product manufacturer, or online merchant) and present your visitors with an offer relevant to your site. Part of your job is finding the customer, the other part consists of warming them up to buy what the merchant is offering. In the case study, I did this by connecting the services offered by the merchant with the software setup project the reader was interested in.
Here's the process for putting this into action:
If you have not already done so, hook your site up into Google Analytics and Google Webmaster Tools. Look at which portions of your site get most of the visits (hint: there's usually a handful of pages that get 80% of the traffic).
Google Analytics offers a free demographic overview of your traffic. Look at that report for clues about who is visiting and what products / services they may be in the market to purchase.
Think about who is looking for that content - what are they reading it? What are they interested in? Is there a particular project or topic they are interested in? Start making a list of potential products.
Now you need to go shopping for potential merchants. A good way to jump start this process is to sign up for a affiliate merchant network. These folks consolidate offers from multiple mechants and give you a trusted platform to track referrals and sales. For a new affiliate, it simplifies the process. We recommend trying ShareaSale. While there are a large number of affiliate networks out there, they have been the easiest one to work with in our experience. It's free for new publishers to sign up and has offers from a wide variety of merchants across most major categories of products and services.
Using your brainstorming about potential products, look for relevant offers on the network. Contact the merchant and sign up to promote them.
Start creating content to promote the offers. Avoid the temptation to simply plaster banners on a page. We've tested it. It rarely works. Take the time to develop well written articles for an individual offer which points out the value of that customer buying from that merchant. That DOES work.