There are many ways to make money from your website, especially by generating a residual income from it.  One of the ways to generate a residual income is through offering advertising opportunities on your website.  When most people think of doing advertising on their website, they think of things like banner ads and sponsored links.  Advertising is basically renting space on your site and getting paid a specified amount for it upfront.

There are may ways to sell advertising.  You can sell space for a one time fee, or rent space for a specific period of time.  Usually the more traffic a website has, the smaller the rental time increments you can offer.  I have seen websites sell sponsored links/banners on their websites for as small as 1 week increments, however these were websites that had a lot of inbound traffic every month.

What makes your website valuable to advertisers

Some websites will be more valuable than other sites depending upon certain characteristics.  The more valuable the website traffic is to these advertisers, the more you can charge for the adspace on your website.  The following are the factors to consider:

  1. Traffic – The more traffic you have on your website, the more visitors will see the ad and the more you can charge for ads on your site.  Adspace usually isn’t valuable to advertisers until you have at least 3000-4000 unique visitors a month.  The higher the quality of traffic, the lower the number of visitors you need.
  2. Traffic quality – this is the type and motivation of visitors who come to your site.  If most of the traffic to your website is from traffic exchanges (becoming defunct as a valuable source of traffic if it isn’t already), or from non specific links to your website, that means that the visitor really has very little motivation to interact with your website.  The higher the interaction rate, the better the traffic quality, and the more you can charge.  What affects interaction rate is what the visitor is looking for on your website, and how they came to your website.  If your visitors has been pre-framed well before they come to your site (through an article, or social network site, etc.) they are looking for information that they can find on your website, or are looking to buy something they can get from or through your website, then you have a captive audience, and that is worth something to advertisers.
  3. Niche Specificity – The more narrowly focused your website is on a niche, the more you can charge.  Your available advertiser pool will go down, but the ad space will be more of a premium because the visitors are so targeted.  It is why Facebook ads charge a premium price because they can be shown to a specific demographic, which will increase the conversion rate on your website, as well as the conversion on advertisers websites.
  4. Ad placement – The placement of the ads is also very important as well because ad placement will determine how many people will see the ad.  Ads that are on the home page and above the fold will have the highest value.  You will need to determine where your ad placement will still be useful for your advertisers and still not take away from the value of the website for your visitors.

Offering adspace on your website

The first thing is that you have to let people know that there is adspace available.  There are a couple of ways to do this.  One is to have a page that indicates that adspace is available on your website and the terms (what exposure does it get them and for how long.)  Another thing you can do is to actually have banners/links on your site indicating that this space is for rent.  If you are just starting out, and don’t have any advertisers yet, you can put up a few banners for affiliate products so that your advertisers can get a feel for how their ads will look on your site and where they would be placed.

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