One of the most important determining factors of how much money your website can make from website advertising revenue comes down to what market your website business is in, which then supports what is realistic for the amount of website traffic that you could receive. For example, if your Startup website was in the business of providing information about ancient dinosaur snails, then the market size for that seems to be on the smaller side. Therefore, it would support less potential website traffic and with that, less potential revenue from ad revenue. But just as the website traffic potential is greater, it is a more competitive arena; and with that, the entrepreneur should be more creative in their marketing strategy and approach.
One typical way to approach advertising revenue is to use a feed of advertisers. This eliminates the need to hire a sales force to sell your own advertising spots. Of course, selling your own ads can generate the highest return but sometimes it is not ideal for a small startup.
Now let’s think on a larger scale. If you have 100,000 page views per month, that is technically 100,000 chances that somebody may click on an ad that is being displayed on your website and each of those clicks means ad revenue.
Let’s say that of the 100,000 page views per month that you get, it produces an average Click-Through Rate (also known as CTR) of = 1%, which can be considered reasonable and not aggressive in some markets. That 1% can range anywhere from 0% to 10%. Anything is possible, but for the sake of this article, we can keep things at 1% to help articulate the figures. There are countless articles on what the average CTR is so that is a larger question.
1% CTR of 100,000 page views in 1,000 clicks. Take those 1,000 clicks and multiply it by what the advertiser is paying per click – that’s how you begin to figure out how much revenue you can make.
Let’s say that the advertiser is paying .80 cents per click (this could be different based on the market you are in and how much the advertiser is paying). That .80 cents per click are not all yours. The ad network feed takes some of course. Let’s say you make 50 cents of it. 50 cents x 1,000 clicks = $500 per month.
The most important element of your website business is to generate your web traffic and brand because if you are generating website traffic to your site, then everything else can follow. Focus on building your traffic and brand through creative marketing strategies in mixture with quality traffic tool called Babylon and then hopefully advertisers will be knocking on your door.