Whilst many websites are started as the result of a passion, as websites grow the pressure to monetize that traffic grows with them. Understanding how to monetize website traffic is essential to ensuring the success of any site. Despite many of the “ads vs affiliate” type discussions online, there is no single right answer. The best way to monetize the traffic on any particular website depends both on the site and that traffic and usually involves more than one channel.
The web is a fast moving field and new ways to monetize website traffic come and go faster than I could ever update this guide. However innovative the next new format is, it almost certainly follows one of a few established models. The key is to understand those models and when each is appropriate to use.
User pays the publisher for the content
The first model is a well-established and familiar one from the offline world: The user pays for the content. Want to read that book? Just pay for it. The model is simple, transparent, well-proven and is efficient in that it involves the fewest intermediaries. It’s not without it’s challenges though. The ease of availability of alternative content is one of the biggest challenges for publishers looking to monetize traffic in this way. If you ask users to pay for content then you need to be pretty confident that they can’t find equivalent content easily elsewhere. Other challenges include the friction that payment handling introduces, administrative overhead, reduced discover-ability of locked content and the social issue of hiding content from those unable to pay.
Best for: Websites with unique, high-value content and enough demand to warrant the administrative overhead
User pays the publisher for something other than the content
Having the user pay for the content of your website isn’t the only way to get your users to hand you money. Offering commerce opportunities alongside content allows the content to remain free to all whilst the publisher benefits from being to monetize their website traffic directly. This most commonly takes the form of selling products or services directly.
An interesting examples of this is The Guardian
Best for: Traffic with a strong commercial intent. Publishers either with something saleable or enough traffic value to justify creating a product or service to sell. Alternatively, publishers with a strong community could benefit from donations
- Selling products/services directly
User acts (not pays) to access content
This model refers to non-payment content lockers that ask the user to complete an action in order to access the desired content. This approach is most commonplace in mobile games where users have to watch a video in order to proceed. So-called “video lockers” are becoming more commonplace on the web as well. An alternative implementation of the same approach is requiring users to complete a survey or answer a poll in order to access content. I’d also include emerging monetization forms like monetization through crypto-mining under this heading, as long as it is presented transparently to the publisher.
The success of this model is dependent on balancing the value of the content vs the inconvenience of the action. A user who might be prepared to answer a one question poll to read an article would be less likely to continue if presented with a ten question survey.
Best for: Medium to high value content, particularly if there is some “immediacy” to it
- Surveys and polls
- Video lockers
- Embedded crypto-mining
Publisher paid for referring customers
The best known form of this model is the Affiliate program: The publisher gets paid for referring a user only when they convert in some way for the advertiser. Affiliate referrals on e-commerce sales are the most common form of this, but the conversion can be also be an enquiry or registration rather than a sale.
Because the publisher is only paid on a successful conversion, the per transaction payouts can look very enticing. However true performance depends on the combination of the publisher’s ability to convert to outgoing clicks and the advertiser’s ability to convert traffic to sales. This can work well when monetising traffic that is close to making a purchase, but significantly less so when it comes to monetizing website traffic that is early in the buying cycle.
Best for: Traffic that is close to the point of purchase
- Referral programs
- Affiliate programs
- Lead generation
- White-label stores
Publisher paid by advertiser for displaying message
This is quite a broad definition covering any transaction where the advertiser and publisher transact directly to put a message in front of the website audience. This ranges from the simple sale of banner ads to sponsored content marketing and everything in between. The breadth of what can be achieved with the model it it’s strength. Working directly with publishers allows advertiser to be creative in how their message is communicated and of course removes intermediaries from the process.
The biggest drawback is the overhead that such direct and bespoke deals create. From negotiation, production, testing, reporting all the way through to chasing payments, overhead is created at every step. That overhead requires scale to justify.
Best for: Busy websites with targeted and unique audiences that advertisers want to reach
- Site sponsorship
- Sponsored content
- Sponsored links
- Directly sold display ads
- Sponsored reviews
Publisher paid by intermediary for displaying message from multiple advertisers
Displaying ads through ad networks and exchanges is by far the most popular method of monetizing website traffic and content. Although it can involve many paid intermediaries between publishers and advertiser, convenience and almost guaranteed fill mean that network display, video and native advertising form a key part of the monetization strategy for many sites.
These forms of advertising are most commonly paid on a CPM (per impression) basis, although programs like AdSense present the position as paying per click, besides effectively being an CPM auction.
Best for: Great all-round approach. Appropriate for most cases
- Display ads
- Native ads
Publisher paid for data
Publishers can also be paid for selling data on their audience. Privacy concerns and regulation have thankfully closed the door on many poor practices relating to user data. Thankfully it is possible to earn revenue from selling aggregate data about users and tagging general interest areas rather than selling actual personal information.
Best for: High value niches, Sites with registered user-base
- Data collection on behalf of advertisers
- Interest tagging
Putting it all together
Effectively monetizing your website traffic usually means finding the right blend of methods from within more than one of these models. Finding the right blend for your website and audience and ensuring that all methods work effectively together can be tricky. This is why many publisher choose to work with website monetization specialists like OKO. We work with publishers to help them to effectively monetize their website traffic without the headaches of managing multiple streams in-house.