Internet Entrepreneurs Blog

These days there is a new way for webmasters to monetize their content that goes beyond Google Adsense and Amazon Associates: vertical ad networks. Vertical ad networks are basically ad sales agencies that target a particular niche or vertical (outdoor sports, for example). These agencies approach big name advertisers and sell hundreds of thousands of ad impressions across their network of small- to medium-sized sites and share the revenue with the publishers.

The concept for vertical ad networks isn’t a new one but up until recently we’ve found the whole concept oversold and underdelivered. Today we’re working with two vertical ad networks across our sites and are seeing revenues per thousand impressions roughly double what we were generating through Google Adsense alone. Vertical ad networks are able to charge premium rates over typical cost per click campaigns because they are more targeted and offer additional rich media ad capabilities (think flash).

One thing to keep in mind when signing on to a vertical ad network is that these companies will often ask publishers to sign exclusive one-year ad contracts. It’s important to do your homework and understand the CPMs, payment schedules, ad filtering capabilities, reporting tools, et al before you sign on the dotted line. Ask to speak with other publishers using the network and don’t be afraid to walk away if something seems fishy about the pitch (like it’s too good to be true), especially if you’re satisfied with the revenue you’re generating through Google Adsense.

Vertical ad networks are a great option for monetizing your site once you’re built a reasonable amount of online traffic (at least 25K impressions per month). If you haven’t already been contacted by a network in your niche, search online to find an appropriate partner - just remember to do your homework!

Google Adsense has resuscitated many online publishers’ business models over the past 3 or 4 years and it’s easy to understand why: because it works. If you’re unfamiliar with the program, publishers (webmasters like you) can sign up for a free account and start serving targeted online ads immediately. The ads are automatically targeted to your site content which means you get reasonable click-through rates while adding a valuable service to your readers. No more need to serve annoying mortgage ads on your site (ahem, Weather.com).

Over the years Google has added more sophisticated features to the Adsense program that allow publishers even great flexibility. Publishers can, for example, block certain advertisers from their site; choose the ad types shown (image, text, video, etc.); and customize ad colors to fit virtually any site design. What’s amazing is that this free tool that’s available to everyone is being used by some of the biggest sites around (myspace, CNN, etc.). If it works for them it must be pretty powerful and effective.

On our own sites we typically see Google Adsense clickthrough rates between 0.5% and 1% which may not sound like much but is actually slighly above industry averages. Our payment is typically around $0.25 per click but this can vary widely depending on your site’s content, industry competitiveness, etc. Google isn’t saying what percentage of the revenue they collect from advertisers they pay out to publishers but suffice it to say it’s around 50%.

If you’re looking for the industry standard in website monetization, look no further than Google Adsense. It’s a great place to start to get a feel for the types of advertisers that might target your site’s content - and you’ll earn some dough in the process!

If you’re looking for a way to monetize your website content look no further than one of the first and largest online affiliate programs, Amazon Associates. In 1996 when we were building our first websites, Amazon Associates was pretty much the ONLY way to monetize a site. The program works on a referral basis: You send your visitors to Amazon, the visitorss make a purchase, you get to keep a portion of the sale (around 5% or so).

Over the years Amazon Associates has added features and tools that give webmasters unmatched flexibility in generating referrals. I won’t get into all the different link types and web services that Amazon makes available through the affiliate program but suffice it to say if you can imagine it, they’ve done it. From Omakase banners, individual product links, custom storefronts, and much more, Amazon continues to push innovation in the affiliate game.

Our experience with Amazon Associates has been mainly positive over the 10 years or so that we’ve been members. Amazon has among the highest conversion rates in the industry meaning once you send your visitors to Amazon they’re more likely to make a purchase than on any other site. For example, our Amazon referrals convert to purchase around 3-5% of the time while other programs we’ve been in usually see 1% or less.

Amazon also offers products for virtually every niche you can possibly imagine, meaning there is a good chance that Amazon carries products your site visitors will enjoy. Of course there are books on just about every subject imaginable (and Amazon carries more of them than anyone else) but don’t forget about other stuff. Running a camping website? You can easily link your visitors to tents, sleeping bags, and camp stoves for sale on Amazon. Search the site for yourself and you’ll be amazed at what Amazon is selling these days.

Many webmasters use the Amazon Associates program as an important source of revenue and you should definitely consider it for your site as well. It’s free to sign up and low risk - the only thing you can lose is your time in adding the links to your site!

Cafepress is a site that allows you to create custom products with your logo or design for free. Just upload your design, choose your product (a t-shirt, for example) and set the price of your product above the Cafepress minimum. As customers purchase your items, you’ll get paid the difference between the price of the item and the Cafepress minimum price. No risk to you and you get your brand and designs listed on the Cafepress website for free. Sweet.

We’ve created some products on Cafepress ourselves and while the revenue hasn’t been spectacular the value of testing new designs on Cafepress is huge. On one of our websites we sell t-shirts and stickers and every couple years we come out with a new design but we’re never sure which ones will sell the best. Printing t-shirts or stickers yourself can be a large capital investment so it’s smart to do your homework before laying out the cash. Within a couple weeks we can usually tell which design is the most successful, giving us the confidence to place a larger order offline.

Cafepress also helps spread your brand to new and potential consumers. We created t-shirt designs for our mountain biking website a couple years ago and listed them on Cafepress.com under the cycling/mountain biking category. When folks surf Cafepress looking for products that fit their interests, they often come across our branded merchandise and sometimes even make it over to our website to see what we’re about. Even if they don’t, it’s a free brand impression that we might not have received otherwise.

Cafepress offers an easy and low-risk way to monetize your website while spreading your brand to potential new customers. Toss up a few designs today and see what works!

Blah - back to work after a long holiday weekend. What if you didn’t have to go back to work and you were your own boss? You could be making your living online and I’m not talking about selling Beanie Babies on eBay or joining Quixtar. Here’s how I’m doing it.

First off, the way I make my living online doesn’t involve any scams or get rich quick schemes - just good old fashioned hard work. When I tell people I make my living doing “web stuff” most people assume I design web pages and to some degree I do - but I’m my own client. My web business is creating online communities and sharing information about everything from mountain bike trails to campgrounds to vacation rentals online and getting paid for the advertisements I run on the websites I own. What would have been too good to be true in 1999 (making money off online ads) is indeed possible in 2008.

Beyond selling advertisements, some of my sites sell other things like online subscriptions and merchandise. On this blog I’ve talked about some ways to monetize a website and in the coming days and weeks I’ll talk about more of the programs I’m involved in including Google Adsense, Amazon Associates, and Commission Junction. There are countless ways to monetize a website but none of it means anything unless you have traffic.

And your website won’t get any traffic if you don’t have any content. And you won’t get any content unless you have Review App Well, okay, Review App isn’t the only way to collect and manage online content but it really does help. We’ve rolled out 3 Review App sites ourselves and we’re in the process of transferring one of our older, larger sites to the Review App platform. Review App honestly makes managing multiple websites easier and gives us the tools we need to grow our content and our traffic (and ultimately our revenue).

The main purpose of this blog is to share how we grow, manage, and monetize our content communities and secondarily to introduce you to the Review App platform. Keep reading the Internet Entrepreneur Blog to learn how to make your living online!

Another revenue stream to consider for your data ranch is the subscription model. While the idea itself is straightforward (users pay to access your content) the implementation requires careful thought.

First off, consider the useful timeframe for your online information. Will the content be constantly updated like a magazine or is it more static like cheat codes to popular video games? If it’s the latter you’ll want to skip shorter, cheaper subscription options since the user will only need to access the information once. On the other hand a free trial period may make sense if your content sees frequent updates.

If you’re unable to offer a free trial for your information, you should at least offer free samples. These samples could consist of low-resolution thumbnail images or, in the example of video game cheat codes, the codes to a few moderately popular video games. Don’t give away the farm (or data ranch, as it were) but do give your customers an idea of the quality of your information.

In the same vein, it’s important to keep as much information publicly available online without weakening the value of the subscription itself. In the example of the video game cheat codes you could build your website such that anyone could read and review information about the games but only subscribers would be able to view the codes. This gives you good search engine exposure while saving your most valuable information for paying customers.

Data ranchers can at times become greedy with subscription services and it’s important to resist this temptation in the name of a great customer experience. How many times have you wanted to start a free trial subscription but balked because it required a credit card? Or even worse, once you’re willing to purchase a one-year membership you find out that it will be auto-renewed at the end of the year, regardless of your desire to continue. If your intention in adding a requirement like this to your subscription plan is to trick folks into paying for something they don’t want or need then it’s a bad idea.

Finally, implementing a secure online subscription system is not a trivial operation and it will require some fairly sophisticated programming. Fortunately there are online services that can help you manage your digital content for a small fee. My favorite is PayPal’s instant payment notification service that gives subscribers instant access to digital goods upon successful payment.

Subscriptions can be a good way to monetize your online content. Building a successful subscription website takes planning and preparation

Another way data ranchers get paid is through a model I like to call “pay-to-post.” Using this model, users pay to have their information listed on a website, usually in hopes of selling something or gaining new business. This is a pretty simple concept so I won’t belabor the point; instead I’ll walk through some examples of different pay-to-post systems.

Perhaps the originator of the pay-to-post model is the granddaddy of e-commerce, eBay. Sellers pay an upfront fee (usually just a couple dollars) to list their items on the auction site, then pay a percentage of the final sales price, assuming the item sells. eBay quickly added pay-to-enhance options to give sellers more exposure (more photos, bold item listings, etc.). Obviously the model works well for eBay and nets much more than an entirely ad supported auction website might.

Employment websites like Hotjobs and Monster.com also utilize a pay-to-post model. Here the hiring company pays a fee to list a job opening on the website for a specified amount of time (usually 30 days or until the position is filled). An important part of this model is the recognition of customers’ willingness to pay. These sites could have chosen to make listing jobs free while job seekers (applicants) paid to apply online. Obviously in this case employers have a greater ability to pay for such services but it is important to consider which side should pay in any pay-to-post business model.

Outside of e-commerce juggernauts like eBay and Hotjobs, even niche sites have found customers willing to pay to post content online. Consider Safarium.com, an online vacation rental by owner listing service. Vacation homeowners pay to list their properties online in hopes of finding renters. Safarium also employs a pay-to-enhance model, offering property owners additional photos, premium placement, etc.

Directory websites like real-estate-agents.com offer to list business contact details for a fee. These sites are not unlike online versions of the yellow pages and most offer some form of pay-to-enhance options. The effectiveness of a directory website listing is based entirely on the quality and quantity of customers who view the website, and in the case of many sites, the return for business owners is not always positive.

Pay-to-post is certainly an effective model for generating online revenue and should be considered by any internet entrepreneur starting an online business. Up next: pay-to-view.

So enough with the theory behind data ranching and user-generated content, how do folks go about making money from this type of operation? One of the most obvious ways that data ranches cash in is through selling advertisements.

There has been an explosion in online advertising in the last few years and it’s easy for anyone to put up a web site and start cashing in on pageviews. For data ranches that are more information-based (rather than community based) it’s fairly easy to generate click-through rates of around 1% or more. Community-based websites, on the other hand, typically see many of the same users day after day who are therefore more de-sensitized to ad content leading to much lower click-through rates. In a sad twist of irony sites with sub-par information and content actually see the highest click through rates.

Beyond the type of data ranch you manage (information or community based) and the quality of your information, the subject of your website will often dictate just how much revenue you can expect from advertisements. Just like a real ranch makes more money raising cattle than chickens, different subjects will net higher ad rates. The classic example of this is mesothelioma lawyers paying $50 per click for client leads while most websites are lucky to get 50 cents per click. I’ve seen this with my own sites with a site about camping seeing CPMs (revenue per thousand impressions) roughly twice those on my mountain biking website.

As an added bonus there is anecdotal evidence that placing ads from Google’s Adsense program will actually lead to a page being indexed in Google’s search engine much sooner than pages without those ads. I’m working on an unreleased website right now that is not linked anywhere online yet the google bot crawled it within days of domain registration and just shortly after placing the Google Adsense code on my pages.

Advertisements are certainly the first form of revenue any data rancher should consider in monetizing his or her website. Up next I’ll discuss some alternate methods for bringing your data to market and cashing in!