Science Addiction

Before I get in to this article, let me tell you a bit about myself- this will help you decide if you think my advice applies to your web site. There are many ways to make money off a web site and my methods have only permitted my web sites to pay for themselves. I run two blogs: this one and another one on film, WideScreen Glory and I have run a large Star Wars fan site since 1998, that makes up the bulk of traffic that I receive.

In a broad sense, there are three methods of advertising on the Internet:

• CPM pays per page view. That is, if an ad has $0.40 CPM that means it will pay $0.40 per 1000 page views that the ad receives.
• CPC pays per click. That is, if an ad has a CPC of $0.40 that means it will pay $0.40 per click by a visitor to the site.
• CPA or affiliate programs pay per action. That is, if you buy anything from Amazon using this link or AllPosters using this one, I will receive a percentage of the sale.

-adsense#SkyscraperRobinsEgg->
All three forms of advertising are useful; the best web sites will try to make use of all three. Of course, some may be more suitable for your web site and I hope to sort that out for you in this article. And before I get in to that, here is one more definition that will bring all of this together:

• eCPM is effective CPM, which means the amount of money you effectively made for 1000 page views. So even if you have a CPM of $0.40 you may receive only $0.30 and the remaining may go to your ad supplier (e.g. Google). In that case, $0.30 is your eCPM. If you have a CPC campaign, but you earned $0.65 through it for your first 1000 ad views, then your eCPM for that campaign was $0.65. And finally, for an affiliate program, if you earned $1 in commisions on sales through Amazon after 1000 people saw the ad, your eCPM for that campaign will be $1. This is an extremely useful metric when comparing CPM campaigns with CPC campaigns, which would otherwise be apples and oranges.

CPM: Making Money off Traffic
FastClick (now ValueClick Media) is my main ad supplier and their main forte is CPM. They have competitive per page view rates (which, of course, vary based on what kind of site you have) which, for many web sites, should form the basis of their site income. CPM advertising is very convenient, in that it is easy to make a clear estimate of your site’s income (or potential income). If the CPM is $1 and you expect 100,000 page views for the month, your income will be $100. There is less volatility and a more clear chance of getting something for your efforts. It is also more satisfying in the short run to see clear results of improvements in traffic.

The downside of CPM is that until your site grows substantially, the rates available to you may be quite low. Also, ever since Google enterred the game, CPC has gained a lot of traction. Also, the quality of CPC ads has improved- and with Google, relevance to the web page- which actually has brought an increase in the number of people who actually click on ads.

This entry was posted on Monday, May 8th, 2006 at 9:30 am by Devanshu and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.