Display advertising is often the best way to monetize a website, but not every publisher feels ready to take advantage. How do you know if your website is getting enough traffic to generate income from ad sales? The answer is more complicated than it seems.
While website traffic plays a big role in a successful digital advertising program, many advertisers look beyond metrics when deciding who to work with. Increasingly, sophisticated advertisers look at audience engagement, click-through rates, and reader demographics when deciding where to spend their ad dollars. There are plenty of examples of low-traffic websites generating thousands of dollars a month in advertising revenue. This means traffic alone can’t tell us how much revenue a publication can generate through direct digital ad sales.
Does this mean it’s impossible to predict the income a publisher can earn through display advertising? Not exactly. With website analytics and traffic volumes, we can estimate whether a publication is ready to transition to ad sales. Metrics like average click-through rates and search traffic provide a foundation to calculate if you’re optimizing your ad sales program.
Certain types of publications are better suited to ad sales than others. We call these advertising-friendly categories, or niches. If a publication’s niche is well aligned with the audiences that advertisers are trying to reach, then it will be easier to generate revenue through display advertising, regardless of website traffic or click-through rates.
Examples of advertising-friendly publishing categories would be travel, auto, home and garden, business, and healthcare. Travel is actually the fastest growing category in digital magazines in 2021. This has caused an increase in advertising fill rates for publications this year after a slow 2020.
The alignment between audience and advertisers is an important one to consider when it comes to ad sales. Publishers have an easier time selling ad space when their publications are tailored to high-value audiences. People who read travel magazines have a high propensity for travel, and as such, hotels and other businesses in the hospitality industry will pay a premium to reach that audience.
At the other end of the spectrum we have general interest publications. Without the ability to reach targeted groups of consumers, these publishers rely more on traffic volume to entice potential advertisers. The volume of traffic that you need to sell ads as a general interest publication is likely higher than the volume of traffic that you need to sell ads as a niche or local publisher.
As an individual publication’s audience grows, the more valuable that audience becomes. Selling ad space becomes easier, and deals get larger. Publishers with high traffic volumes are better positioned to sell ads directly to businesses.
Generally speaking, online publishers that work with ad networks can expect to generate $2 to $5 per 1,000 impressions. That means that for every 100,000 pageviews each month, the publisher will generate $500. The specifics here will depend on the ad optimization and the publication’s niche. Publishers in advertising-friendly categories can expect to generate more than those in general interest categories, like national news or celebrity gossip.
Unfortunately, many ad networks and exchanges require publishers to split the revenue they generate. That split eats away at profit margin, which is why more publishers in 2021 are forming their own ad sales teams and selling to advertisers directly.
Years of experience working with publishers of all sizes have shown us that publications with 10,000 or more monthly visitors can generate significant revenue selling directly to advertisers.
The volume of traffic you need to sell ads depends on your website’s niche and your financial goals, but it’s almost always less than you think. It’s possible to run display advertising on a website that gets 10 unique visitors a day. You might find that a website with 120,000 unique visitors a day doesn’t generate as much advertising revenue as another website with 20,000 unique visitors a day. That’s likely because the smaller site caters to a niche—and highly desirable—audience. Publishers will find unique ad sales opportunities everywhere along this spectrum.
The key to success in online ad sales is to identify your publication’s strengths and weaknesses, and then capitalize on those areas when pitching potential advertisers.
To learn more about what it takes to succeed at direct digital ad sales, read Ten Advantages — The Tested Game Plan for Digital Ad Sales.
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