Forums: Discussions for entrepreneurs and small business.

I see a lot websites with Google sponsored advertising on their sites. Where can I get real data on the type of revenue you can expect to generate using Google or yahoo sponsored ads. I`m in the business planning stage of a user generated site, and I am researching revenue model options.       

-------------------------

Erick Tyree-Dillard

Get the info from Google AdSense.

Just in general, finding people to purchase ad space on a CPM basis is a lot more profitable than AdSense`s PPC.

What is your proposed traffic for the site?

The usual suspects for revenue are

1. Advertising revenue (Google AdWords, sponsorship, etc)
2. Selling gear (t-shirts, caps, etc)
   
3. Premium areas for paying customers

If you have a large user base then you can add selling the company.

The conversion ratio for advertising is usually 1-2% but remember your making money by encouraging people to leave your site.

As with most web sites the "suck it and see" approach is usually the best. Build your site quickly with the minimum requirements and see how people respond. Once you have a user base then work out how to make money from them.

-------------------------

Blog - http://www.buggy.id.au/

I am researching traffic numbers as we speak. I just don`t want to forecast numbers that are unrealistic.

I am seriously considering taking Richards advice and develop a bare minimum  site to test response, and work out the bugs. I hope I can take that data and use it to get an idea about traffic numbers.

Thanks guys for the info. 




-------------------------

Erick Tyree-Dillard

Keep one thing in mind if you are banking on Google AdWords Revenue... Google is moving to a Pay Per Action Beta test model.  That means you will not get paid on a per click basis but only if the visitor then moves to a particular action...

For example - Your visitor Clicks on the link, goes to the advertisers landing page... the advertisers goal is to have the visitor sign up for their newsletter.  No payment is made (or received by you) unless the visitor actually does just that.

It`s a boon to advertisers, but could diminish the return on a site that uses google as income.   Also - it unfortunatelly now makes your income based on the advertisers ability (or lack there of) to successfully set up a campaign to create the desired result.

-------------------------

Web Site Design
Internet Marketing
Web Hosting

NewWard Development, LLC http://www.newward.com
"We Make Your Web Site Your Best Employee"

To Newward:
Why do you think that Pay Per Action AdSense can diminish income ?
Price for this ActionClick will be much more then current PerClick price.

From my point of view it will be just cj.com but from other side - sponsors will be thinking about converting rate and publisher will more focused on traffic raising

I think the per action model will weed out some of the people just building AdSense sites, because the overall revenue will be less.

It might make AdWords not worth it for people purchasing ads, due to low publisher response.

Personally,  I am not a fan of pay per action ... you are relying on the advertiser`s conversion rate. If their conversion model sucks, are you just serving up their ads for free?

And speaking of free, you are serving up thousands of their ads for every conversion. Shouldn`t they pay for you to have their name all over your site?

-------------------------

Jim Harshaw
Albemarle Window Cleaning
Charlottesville, VA
www.albemarlewindowcleaning.com