Looking to Double or Triple Your Online Ad Revenue?

With today’s analytics systems, there are so many online metrics to look at that it’s easy to get overwhelmed. In the end, however, there is only one traffic metric that really matters to publishers: page views. This metric is critical for a number of reasons:• It measures reader engagement: the total amount of content consumed by your readers.• It defines the inventory you have to sell to advertisers (more page views equals more impressions).• It defines the inventory you have to market your own products for sale (e.g. books or other real-world or digital products).• It defines the opportunities you have to market a webinar, lead-generation program, e-newsletter, conference, etc.Let’s look at a simplistic example of how increasing page views impacts online advertising revenue. As shown in Figure 1, assume that on every page of your Web site you have:1. a leaderboard, 2. a rectangle, and 3. a skyscraper. If you sell your ads on a cost-per-thousand (CPM) basis, it’s easy to see how an increase in traffic can lead to increased revenue potential (see Table 1). But even if you sell on a flat-rate basis, as page views increase, you can charge more for the same position or add more advertisers into the rotation for each position while still delivering the same value (number of impressions) to your advertisers. Too often we, as publishers, focus too much attention on tactics to reach more people (unique visitors), when we could grow our page views per month just as much—and often at a lower cost—if we just did a better job of getting the people we already reach to come back more often (visits per unique) and do more while they are on our site (page views per visit). This is reflected in a formula I call the Traffic Equation: Page Views = Unique Visitors x Visits Per Unique x Page Views Per Visit Table 2 shows the Traffic Equation in action, and how any one of these variables can multiply your site’s traffic and revenue potential. While the table is a simplistic, ad-revenue-driven example, the concept still works regardless of the number of ad positions you have, the price that you charge for the positions, and whether you sell at a CPM or flat-rate basis. If your primary revenue source is selling your own products to your readers, this table still applies, but represents exposure to your house ads and the opportunity you have to convert this exposure to sales. Use Scenario A as the baseline: 20,000 unique visitors coming to the site twice per month and registering two page views each time they visit. These are typical numbers for many publishing Web sites. Scenario B illustrates how, simply by getting our existing audience to visit once per week rather than once or twice per month, revenue can double. Scenario C shows how, if we get those same people to look at four pages on our site each time they visit rather than two pages, our revenue can again double. If we then increase the number of unique visitors, our revenue will again increase (Scenario D). As you can see, growing your site’s traffic and revenue potential is not dependent upon simply increasing your site’s unique reach, but can be just as significantly impacted by giving your readers a reason to come back more frequently and engage more deeply with your site. Eric Shanfelt is executive vice president of eMedia for Aspire Media. He previously served as senior vice president of eMedia for Penton Media, and spent a year as an industry consultant helping more than a dozen b-to-b and consumer media companies grow their online media business. Shanfelt has an extensive e-media background spanning 17 years and specializes in practical revenue-generating strategies for publishers.

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Looking to Double or Triple Your Online Ad Revenue?

Eric Shanfelt

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Eric Shanfelt