Wow, you really need a lot of active users to make money on a free app/website using advertising as your revenue source. It seems almost unrealistic, frankly. That said, I don’t think it is unrealistic at all. Lots of people make real money, just from advertising. This post is to help me (and you?) remember how the generic advertising part of making money works. Other posts will be about other topics…
What is $100,000 per yer, if you make money every day? You need to make $274 per day, which doesn’t sound like much, really. Until you dig into the numbers.
As far as I can tell, for impressions, you make $1 or so per 1,000 impressions, as a general rule. An impression is every time an ad is put in front of someone, so if they go from page to page, and the ad changes every time, that’s an impression. If they stay on a page for a long time, and the ad changes, that’s an impression. To make $100 per day from impressions, you need 100,000 impressions per day. Wowsers!
Remember, that’s impressions, not visits. If a visitor goes to your home page, then another page, you probably got at least two impressions. If they stay on a page for a long time, you might get another impression, as the ad on your page refreshes (note, I said might). If you have three ads on every page (I doubt I’d do that), you would get around $3 per 1000 pageviews, since you’d get 3 impressions. That could make per impression ads “easy” to make money on.
Oh, right. If they visit 2 pages per visit, then you are really getting $2 per thousand users. But, that’s not going to happen for every visitor for every day. You need to figure out how many people click to more than 1 page per day. It also appears that the really good companies for this type of advertising require your site/app to already be a big player.
Pay Per Click:
Pay per click is just what you’d expect….you make money when an ad is clicked, just as the name implies (which is a nice change from a lot of other names on the interwebs). If your site is really good at a particular thing, or features certain topics, you might make a lot per click. But, it looks like you make from 25 cents to a dollar per click, sometimes a lot more, sometimes less.
Now, here’s where the numbers seem worse than impressions….not everyone that visits your page is going to click on an ad. Most won’t, actually. From minimal research, it appears that an average site might get a 1% click thru rate. So, you need 100 page visits to get one click. However….at 1%, you are basically getting paid for every 100 visits, not 1000. So, pay per click pays better. You can make $100 on “just” 40,000 visits.
Those are really the two ways to make money on advertising, when you aren’t working with a direct advertiser/sponsor, or an affiliate network of some kind. I’ll research those, and post about them, soon.