These are companies that pay you as a webmaster or blog owner money for allowing their ads to be shown on your blog or site. There are two classifications of ad networks: the PPC Advertising Networks and the CPM Advertising Networks.
1. PPC Advertising Networks – PPC simply means “pay-per-click” and that means you get paid for every click performed on ads displayed on your blog.
The most popular of which is selling contextual ads with Google adsense. Contextual in a sense that the ads served on your site is closely relevant to the topic. For example if your main topic is “life insurance”, expect to see closely related subjects such as “Online Insurance Quotes”, “Term Life Insurance” showing on your adsense ads.
This involves signing-in with Google as a publisher and then adding a piece of HTML code to your site. Don’t get overwhelmed with the word HTML. It’s a sort of copy and paste procedure anyway and it’s very easy to do.
How profitable is PPC?
The profitability of this monetization channel depends on several factors. The first factor is your site’s general traffic level. Traffic simply refers to your visitors. The more visitors you have the more chance your ads are clicked.
The two most important factors that affect your ads being clicked is the click-through rate (CTR) and cost per click (CPC).
CTR is just a way of measuring how successful an ad is. This is determined by dividing the number of clicks performed on an ad by the number of times that ad was shown (impressions). For example an ad has 1000 impressions but only had one click then the resulting CTR is 1%.
CTR depends on how your website is designed and where your adsense are placed. For example, ads placed above the fold or blended within the content tend to get higher CTRs. Above the fold simply refers to the top part of the site that you will first see on the screen without having to scroll down.
The CTR rate is also affected by the source of traffic or where your visitors is coming from. Traffic coming from the search engines (also called organic traffic) tends to give you more clicks because they are the ones that are really looking for something, and they tend to click on ads more often. Traffic from social sites (and other blogs), on the other hand, gives you terribly low CTRs because these visitors are “ad blinded” and so they just ignore ads.
The CPC, on the other hand, depends on the main topic (also termed as “niche”) of your site. If you revolve around topics or niche such as mortgage, life insurance, debt consolidation, and other high paying keywords it may produce high CPC on your adsense ads. Clicks may worth as high as $50, although rare, and as low as a couple of cents.
Popular CPC ad networks:
2. CPM Advertising Networks – CPM stands for “Cost per Mille” which means “cost per thousand impressions”. The system is almost the same with PPC ad networks except that you’ll get paid according to the number of impressions that is generated from the ads displayed on your site.
CPM rates may come for as low as $0.1 and as high as $10 per 1,000 impressions. CPM advertising is mostly applicable on websites with a high page views per visitor ratio such as online forums and social network sites.
Rates also depend on the ad network, the position of the ad and the size of the ad. The better the network, the higher the CPM rate since they have access to more advertisers. Placing the ad to the top of the page may give your a higher CPM. The bigger the size of your ad, the higher the CPM.