This is Part 4 of our series of posts for “The Ultimate Guide to Making Money From Ad Networks”.
How Much Can You Earn With Ad Networks?
This is an extremely tricky topic to tackle because publisher’s earning potential depends on a great many things. The biggest consideration, however, is how much traffic you’re getting on a monthly basis.
Ads shown, clicks made, or leads collected – that is what’s driving your revenue up when working with an ad network. These actions require site visitors and to get those site visitors you have to have an engaging web page with unique content.
Site traffic heavily depends on the niche. Some niches simply can’t count on huge numbers of monthly visitors. Following that, it stands to reason that their monthly revenue from advertising will be lower.
Of course, quality news sites get the most visitors by far. That’s because they cater to large audiences and publish fresh content on a daily basis. On the other hand, they also employ tens, sometimes even hundreds of people and have high running costs.
For the purpose of this post, we’re going to focus on blogs. While there are certain blogs out there that get millions of views on a monthly basis they are few and far in between and it took years for them to get established.
There are a lot smaller blogs (like yours) out there and they can still enjoy a steady stream of passive income from advertising – provided they’re smart when it comes to choosing an ad network and a revenue model.
Smaller blogs have a tough time getting accepted to larger networks such as Monumetric which offer bigger payouts to advertisers.
Those networks – along with a number of other established ones – require you to have a minimum of 100,000 monthly visitors in order to be eligible to join.
The CPM Model (Cost Per Mile/Impressions)
However, there are a lot more networks that would be happy to cooperate with smaller blogs which just can’t get such high numbers.
The revenue model for these is usually cost per mile, meaning that you as a publisher get paid for every 1K impressions you show to your visitors. The payout is lower than with other revenue models but eligibility rules are less stringent.
For display ads, the average CPM in 2015 was $ 2.8 and publishers would earn even less after the ad networks took out the percentage of the earnings.
So let us say you have a blog that gets around 10,000 visitors per month. Assuming that the fill rate is at or close to 100 % at all times (meaning that every one of your ad zones is always showing an ad) it means that ads will be shown 10,000 times for one ad zone.
If you have 3 ad zones than the ads will be shown 30,000 times – $ 2.8 X 30,000 / 1000 = $ 84. Depending on your deal with the ad network, you will get to keep a partial amount of it. Let’s be generous and say it’s 80 %. In that case, your cut would be $ 67.2.
This number is slightly discouraging, we’re aware of that but keep in mind that 10,000 monthly visitors is a bit on the low side. Also, we’re talking about auto-piloted income here – if you’re already blogging about what you love this is an easy way of earning some extra cash.
However, bump the number of monthly visitors up to 250,000 and the revenue also shoots up – $ 2.8 X 250,000 / 1000 = $ 700. After ad network deductions, that leaves you with $ 560 monthly, which is nothing to be sneezed at.
Of course, we’re talking about averages here. The average CPM for 2015 includes premium networks and that is why it may look slightly high to publishers who are unable to secure such deals. Unfortunately, publishers who are just starting out will hardly see such prices. For them, CPM around $ 1 to $ 1.5 seems more realistic.
CPM networks are a great way for publishers that are just starting out to monetize their efforts while they are growing and developing and until they are ready to graduate into the major leagues.
The PPC Model (Cost Per Click)
The PPC – Pay per Click – pays the publishers for every ad click that is generated on their site.
We can use AdWords Display Network as a sort of a benchmark here. Even though AdWords is a beast completely different from ad networks PPC trends are pretty much the same across the board – some networks will pay less, others will pay more, depending on their quality.
In 2015, average PPC for all advertising platfroms was $ 1.58. There are highs and there are lows – it all depends on the niche – but we can probably apply the same average on ad networks.
For networks, though, it can be a bit more complicated – some clicks can be worth $ 0.1 and others can be worth as much as advertisers are willing to pay for them, sometimes over $ 3.
The second metric worth discussing here is the click-through rate. This one cannot be discussed in averages because it depends on a lot of variables. The two main variables are:
– Copy and creative
It’s not unusual to see CTR of barely 0.1 % but then again it’s not unusual to CTR of 1 % – again, it depends on the niche.
For a quick and dirty calculation, we will use the average PPC and CTR of 0.5 %. We’ll start with 10K monthly visitors – with the average CTR of 0.5 % you can expect to see 50 clicks every month – 50 X $ 1.58 = $ 78.
After deducting a minimum of % 20 from that amount (ad network costs) a publisher is left with $ 62.4.
If we bump up the traffic to 500K per month the number of clicks will go up to 2,500 – 2500 X $ 1.58 = $ 3,950. Again, take out ad network’s share and you will be left with $ 3,160 – a sizeable chunk of money.
The best way to increase your revenue as a publisher in this case would be to go with niche-specific networks.
If you have a blog in the food niche you will see a greater return if you partner up with an ad network that delivers specific, targeted ads to your site.
Some PPC networks are difficult to get into. As we already mentioned, some will require a minimum amount of traffic per month.
You will also want to check out how many advertisers they are working with and what is their average click pricing, along with the conversion rates of their ads.
You can also give AdClick Media a try– this is our home-grown network which caters to various niches and has been successfully collaborating with advertisers and publishers for over 10 years.
As you can see, the potential for earnings is there but your revenue as a publisher will depend on a lot of things. Some you can control, such as the quality of your content, audience engagement, ad placement, and more.
Others, such as fill rate, ad copy and creative, and category rates are beyond your immediate control but can be influenced when you are choosing an ad network.
Your success as a publisher won’t come overnight – a good amount of work and planning will go into it but it you stick to your guns you will be able to some money from your site.
How much – no one can really know.
If you have any questions drop down by the comments sections. If you’re an experienced marketer we’d love to get your story as well – any advice for the newbies? Sharing is caring!