Choosing a revenue model is a critical first step in developing an online business. While your overall business may have multiple revenue streams, publishers and media companies typically rely heavily on ad revenue to survive.
In any case, whether you intend to provide free content or require additional funds to supplement your other revenue streams, establishing an ad-based revenue stream is a common and effective solution.
What is Ad Based Revenue Model?
Ad-based revenue models include creating ads for a specific site, service, application, or other product and placing them in high-traffic, strategic channels. If your business has a website or you have a website, Google Adsense is one of the most common advertising tools. For most sites, AdSense will bring you around $ 5-10 for 1,000 impressions.
How Does Ad-Based Revenue Model Work?
Basically, you create an account, advertise and collect revenue based on impressions or clicks on a local ad. You don’t need to manage your ads this way, although you donate some of your revenue to a third-party service provider.
Monetization Options
Making money from advertisements is one of the simplest and most straightforward ways to implement revenue models, which is why so many businesses rely on advertisers as a source of revenue.
The challenge is frequently generating enough web traffic to your site for your campaign to meet its revenue targets.
Programmatic Advertising:
This is the most basic way to begin monetizing your product with ads, especially if you have low to medium traffic and are new to AdTech. The majority of businesses will sign up through Google AdSense, but there are a variety of other options available.
Such platforms automatically display ads based on keywords and site traffic, so there is little work to be done on the publisher’s side and can be easily managed.
Pros:
- Automatic publication means that you will have lower needs for an ad ops expert
- Specialists, you simply do not need to configure
- Options to configure that you may receive advertisements where
- If you have competitive keywords and internet traffic, can offer significant
Cons:
- Payment per click/impression is determined by the platform, not you.
- Your product may require you to generate a minimum income to be paid.
- Less ad control means more likely compatibility issues and site crashes
- Software platform (and any player along the way like DSP and SSP) will get a percentage of your income
- Difficulty setting up software platform management means you can leave money on the table if they are not perfectly positioned
Find a Monetization Partner:
If you are starting to notice an increase in traffic to your site and you want more granular control over the ads you publish, as well as more control over their profitability, you may want to consider partnering with a third party to manage their inventory.
These agencies are experts in online advertising and will support your ad campaigns with more personalization depending on the experience your product offers. In most cases, these agencies will operate across multiple sales channels, opening your sales channels to opportunities that you may not have been able to do yourself.
At the moment you can also think about introducing advertising inventory to inventory and follow the KPI, so you can really stay on what your niche informs about your advertising partner.
Pros:
- More personalization and focus on your audience
- A wider range of resources and income channels
- No minimum income
Cons:
- Agencies will charge a commission on every sale
- If your product is not generating enough traffic it can be a risky expense
- You need an advertising specialist to help manage your campaign
Sell Directly:
Direct sales posting is typically intended for high-traffic sites with a full-fledged advertising or sales team. In this case, your site is so popular that advertisers want to feature on it, usually with a bonus.
You’ll save money on commissions, have more control over ad formats and types, and can directly negotiate prices with advertisers.
Pros:
- Negotiable price
- High site traffic means advertisers will be willing to pay more
- More control over ad types and placements
Cons:
- Requires sufficient web traffic to generate demand from advertisers
- Requires a fully dedicated team of advertisers to negotiate sales
Build Your Own Ad Stack:
Many seasoned publishers use this technique to keep control of their publications without stretching too much. In this case, you will be participating in both direct purchase and automated sales scenarios.
By creating a standalone solution that combines these capabilities, publishers can diversify their inventory while maintaining fine-grained control over ad styles and placements.
Pros:
- With more control, you can better optimize each ad type and placement on our site to maximize your impressions.
Cons:
- Inventory management will necessitate a dedicated and knowledgeable team.
