Forum Moderators: skibum
Today, I had the owner of an online store contact me, telling me that she's been lurking on my bulletin boards and would like to advertise there once I'm ready to go that route. I hadn't even gotten to the point where I was thinking of such matters yet - but I don't want to pass this opportunity up either. From a brief conversation we had, I've gathered that she's interested in paying a monthly flat fee to have a banner ad appear on my site. My problem is that I haven't even the slightest idea HOW MUCH I should charge her. I worry about underselling myself and at the same time, I worry about giving her a price that is too high, to where she will turn me down as she herself appears to be a small business owner.
I would be VERY greatful to anyone who could point me in the right direction. I'm coming to realize that this site I put up just for fun has the potential to become a goldmine, and I want to jump on the bandwagon with everyone else here!
Jazz
that's the beauty of dynamic-content-communications.
"Dynamic-con-"-what? I've never even heard of this word/phrase. Can you fill me in on what it is? It sounds promising.
Yep - I haven't even STARTED on content yet - I was still working on the ins and outs of phpBB, and figuring out how to customise it to my own look and feel. I have plenty of ideas for content, and they will be implemented eventually. But the "site" is sustaiable on it's own without the content. I lucked out that I started it right as another site shut down their VERY popular boards - and I invited a few members over - they've spread the word since then for me!
The topic is mainly chit chat - a bunch of women talkig about their lives, exchanging recipes, helping each other get great deals with their shopping, and sharing couponing tips. I've had requests for a number of new boards that people are interested in, and so I'll be adding an arts & crafts board and a sweepstakes board tonight.
The person who contacted me sells handmade jewelery - I think it's exactly the kind of product my members will LOVE.. so I consider this highly targeted traffic. Especially now with christmas coming.
Since my last post, I've given this some more thought - I think I would like to install a banner rotating script - and sell advertising in chunks of X thousand exposures (for example 50 thousand) - this way if the page views continue to explode the way they have so far, I can get more advertisers without tying up the spaces on my site where ads will be visible by having sold that space to one person for an unlimited number of page views for the entire month.
Any more thoughts, considering this information?
Jazz
The reason I say this it that it appears people from the old forum are flooding to yours. This could be a set up for history to repeat itself.
You also might want to consider posting to WW's "Forum and Community Building" threads.
[webmasterworld.com...]
Pete
Freeflight2 said:
my advise: don't ruin your site by putting ads on top of it... not yet.
With that kind of momentum you will be much better off keeping it non commercial for a while. Especially if you have women as your main audience you might ask for donations
Believe it or not, my members are already asking me when I plan on starting to place ads. They are very aware that this site is my labor of love for them, so to speak. Most of them don't know much about the ins and outs of running a site but they are aware that the more they talk on there, the more expensive it gets for me. And they know that the only way for the site to be around for the years to come is if I place ads on the site. I do not want to ask for donations at the time - I'd rather wait until I can offer them something in return for their donation - perhaps a small webmail account that they can use to enter sweepstakes, for example.
PeteM said:
Stick Adsense on the top of the phpbb pages. See how much you make in a month then double it to arrive at an exclusive figure for banner ads. All IMHO.
Webwork asked:
If you offered a little more information about what contributed to the downfall of the other board you might get a little better input about how to promote your board's success.
The site that shut down it's boards did so because of members squabbling to the point where it got extremely ugly. That combined with the fact that most of the mods were on a power trip from hell, and disaster was inevitable. Of course, the song and dance the members are being given is that the chit chat boards never made the site any money so the company is shifting focus onto their couponing part of the site. Hard to believe when the chitchat boards resulted in millions of pageviews I'm sure. Once the boards shut down the members split up into a few different boards that were established by other members from the site. I know that one is already in trouble because the members are arguing there, and the other gets next to no traffic. My boards however get lots of traffic and has a great crowd who arevery aware that their hangout was ruined for them by a few bad apples - and as a result have been behaving quite well. I'm quite proud of them!
Back to the issue at hand: Placing an advertiser on my site. Would something along the lines of perhaps $50 a month, with a minimum of 50,000 page views be a reasonable price? 75,000? 100,000? As was pointed out to me in a sticky note - any business that can't afford to spend that much money a month to advertise is in big trouble already. I agree with that. I'm placing in the word 'minimum' because this way I can fill the rest of the page views with other advertisers as I find them. But at the same time, if I don't, I can continue to show her banner. I feel confident that I should be able to install a banner rotating script that tracks impressions without too much trouble. (If anyone knows of a good one that is free that information would be greatly appreciated too)
Am I on the right track?
Jazz
1. Whatever you charge, write a contract that promises the monthly price is only fixed for a limited amount of time (typically a year).
2. To calculate price, add together your monthly operating costs (including your salary) add profit and divide by the number of advertisers you want on your site. That is your monthly advertising cost.
(all operating costs + my time + profit) / number of advertisers = cost to each advertiser
The most variable number in this calculation is operating costs -- as your site becomes more popular you will rapidly incur additional hosting costs. It is vital your advertisers understand that the rate they pay today may not be the rate they pay five years from now.
<edit>tpyes tpyos typos</edit>
The other reason is, once you get a long contract, you've locked YOURSELF into the amount of the contract. What if you learn a month later that your space is really worth three times what you sold it for? Or what if you priced it appropriately when you sold it, but you were charging a flat rate and now you have triple the pageviews so the space is worth more? Too bad, you gave the customer a one-year deal, and now you have to wait another 11 months before you can sell it to somebody else or charge the same advertiser a higher price.
I generally let advertisers pick between 1 to 6 months when they sign up, but I do make them decide right when they sign up how many months they want in for.
Once you have more willing advertisers than ad spaces, you can sell your space at auction, and find out how much it's *really* worth. I wrote an ad-auction system for a site that had a waiting list of advertisers, and in seven months we're now bringing in over 250% of what we were before.
Anyway, to answer your question: Earlier this year my friend/client put me in charge of ad sales on his site, because he's good at generating the content but he's not good at sales -- or billing. So he gave me all the contacts and said, "Here's the list of current advertisers, and here's the waiting list." And I went, "Waiting list?!" That told me something immediately: The price was too low. The trick was figuring out how much our ad space was actually worth, as well as making the system fair, since my client is all about fairness.
So I thought about it and I figured, sell the space at auction! That way we find the *exact* market price. Plus advertisers can't complain about the price because we don't set it, they do. (In fact, before we went to the auction format a few advertisers grumbled about the price. But now nobody complains even though the price is three times higher.) Also, there's no more waiting list: Every time we have a space available every single one of our potential advertisers has an equal shot at getting it. That satisfies my client's sense of fairness, and mine too. And no one has to fume on a waiting list for a year or more any more.
I wrote the auction system from scratch using Perl/MySQL, though there's no reason you couldn't use eBay. I did it in-house because we wanted special features and more control. When a space becomes available I send out an announcement to our advertiser list letting them know that a spot is available and giving them the address to the auction page.
Granted, we're in a lucky position -- we have only a few ad spaces available on the site, and we have a lot more willing advertisers than spaces available. Most sites aren't in that position, and in that case an auction wouldn't be good for them. But it works great for us.
Until you have advertisers elbowing each other out to get on your site, one way to price your space would be:
1. Put AdSense on your site for a month and see how much revenue it brings in.
2. Approach some of the relevant advertisers who appear in the AdSense ads on your site and offer to put their ads on your site instead, exclusively, for something like 125%, 150%, or 200% of how much you were making with Adsense (but of course they don't have to know that your price is based on your AdSense revenue). The worst they can do is say no.
3. Let them pick their timeframe, 1-6 months. While their ad is going, try to find another advertiser willing to pay 25% more. Tell them only that you *may* have space available, because your initial advertiser might be willing to pay a higher price to renew when their run is up. When the run is up, hopefully your spot will go for 25% more, whether it's the original advertiser or a new advertiser.
4. Repeat #3 forever. Of course, when you start getting more interest in the site you can stop offering exclusive space on it and offer smaller spaces to a handful of different advertisers. And if you ever get more interest than you can easily deal with you can always sell the space at auction.
