Publishers looking to diversify their monthly revenue streams have embraced displaying paid advertisements on websites, apps, and social media channels.
While there are no hard figures on the number of ads we see on a daily basis, estimates have grown from an average of 500 in the 1970s to as much as 10,000 today.
When considering that advertisers worldwide spent an estimated US$491.7 billion on online advertising in 2021—and are projected to spend almost US$571.2 billion this year—it becomes clear why ad revenue is such an opportunity for publishers to monetize their content.
If you’re looking for ways to both increase and diversify your revenue we’ve got you covered below. But first, let’s cover a few basics.
Table of content:
• Advertising Revenue Metrics: CPM and CPC
• How is Ad Revenue Calculated?
• How Much Ad Revenue Can You Make?
• What is Facebook Ad Revenue?
• 13 Ways to Improve Ad Revenue
Advertising Revenue Metrics: CPM and CPC
Click-per-mille (CPM), also known as cost-per-thousand and cost-per-impression, represents the cost paid for 1,000 ad views on a single page.
Cost-per-click (CPC), on the other hand, represents the cost for a single click on an ad.
Both CPM and CPC are the primary metrics used by ad networks.
How is Ad Revenue Calculated?
Calculating total ad revenue is pretty straightforward.
Using the CPM model, it's the total number of ad impressions divided by 1,000 and multiplied by the agreed CPM rate.
And for the CPC model, it's the total number of ad clicks divided by 1,000 and multiplied by the agreed CPC rate.
Use this website ad revenue calculator to gauge how much revenue you could potentially make.
How Much Ad Revenue Can You Make?
When it comes to monetization, CPM and CPC depend on a variety of factors, such as target audience demographics, the niche, supply and demand for a specific product or service, the ad network used, and the season.
Ad impressions and user clicks will largely depend on the app or site’s traffic and the targeted audience.
The math is simple—the higher the CPM, CPC, and traffic, the higher the revenue.
What is YouTube Ad Revenue?
Publishers not already present on YouTube need to rethink their strategy, given that the video platform has 1.86 billion users and is perfect for in-stream ads.
The case for building a complimentary presence grows in light of a study last year by the Pew Research Center showing that 74% of Americans used the platform.
Publishers can monetize their channels through the YouTube Partner Program, as long as they gain more than 1,000 subscribers and 4,000 hours watched over a 12-month period. This allows partners to earn money from ads placed within their video content.
What is Facebook Ad Revenue?
The reasons for creating a YouTube channel are the same as those for creating a presence on Facebook. It is the most visited social media platform, with 2.91 billion monthly active users at the end of September 2021, and is a magnet for advertisers.
Facebook gives media and publishers five ways to monetize their account, which includes adding video ads, ads within articles, a subscription shortcut, collaborating with brands and earning money from live video.
What is In-App Ad Revenue?
In-app advertising has become very popular as a monetization strategy over the last two decades, in line with the explosion of the mobile gaming industry. The latest data show that there are around 2.66 billion gamers worldwide. Games are not just about gaming, but have also started developing social aspects, making them an increasingly desirable advertising platform.
Mobile games were projected to generate 45% of global gaming revenue in 2021, and a large portion of it goes to hyper-casual games, as they account for 62% of the top 30 games by number of downloads.
Today app developers can earn revenue through their mobile apps by displaying ads to the user. These can be rewarded ads, banner ads, playable ads, or in-app purchases.
And as with any other form of ads channel, the average revenue will vary, depending on the app’s popularity, user engagement, whether it uses rewarded ads, interstitial ads, or offerwalls. The cost of the CPM in the gaming industry typically ranges from US$4.00-12.00.
13 Ways to Improve Ad Revenue
1) Choose Your Target Audience
The cost of CPM and CPC will vary depending on the country where your target audience is located. For example, the CPM of an African or Balkan audience will be much lower than the CPM of an American audience, owing to the relevant population's purchasing power.
The same principle applies to the demographics of an app’s target audience. If, for example, an app is aimed at minors, most of the target group will likely lack the means to complete a digital transaction, representing a conversion bottleneck.
So if ad revenue is low, the reason might be that the target audience comes from the regions with low CPM and CPC or from an age bracket with limited liquidity.
2) Increase Content Quality
Content quality is essential for ad revenue. The advertiser pays for views or clicks, which requires an audience and high traffic. And the best way to increase traffic is to provide good-quality content. That's why placing ads within low-quality content is unlikely to generate revenue.
The content needs to be unique, credible, and valuable for the audience before Google will recognize it. And yes, it needs to be SEO-friendly, with keywords with a high search volume and low competition, if possible.
The better the SEO, the higher that Google—and other search engines—will rank your page.
3) Provide Dynamic Content
Pages where the content doesn't change are unlikely to deliver in terms of advertising revenue. It’s not enough just to post an article and hope for the best. Google likes forums, blogs, or vlogs, where publishers and users interact with the content constantly. It’s all about showing high engagement levels.
4) Offer a Free Tool
And on the subject of boosting user engagement—Google Adsense advises that websites that offer a free online tool are perfect for attracting both new and repeat visitors.
5) Choose the Right Niche
Ad networks discover CPM and CPC based on supply and demand. This means that some industries or niches with high demand will have a higher level of monetization.
Some of the highest-ranked niches are insurance, online education, marketing, legal averaging, cryptocurrency, online banking, internet, technology, car industry, eCommerce, and health.
6) Bypass Ad Blocker Issues
According to Statista, 763.5 million internet users use ad blockers to prevent ads from appearing, which ends up hurting ad campaigns.
There are two strategies publishers can use to bypass these ad blockers.
The first is by asking the audience to turn off ad blockers while on the website, app, or channel. This is a risky tactic since it may result in the audience leaving regardless of how engaging or unique they find the content. If your audience begins to bounce it can hurt both your monetization goals as well as your Google ranking.
The second approach is to use native ads, which are incorporated within the website’s content. This tactic is more appealing because it doesn't irritate the user and adds value to the content. For example, it could be beneficial to display an ad that promotes eCommerce software on a page about eCommerce revenue strategies.
7) Optimize the Number Of Ads Displayed
In the marketing world, less can often mean more. Too many ads displayed within an article, video, or app, might cause the audience to leave, once again hurting advertising revenue. This will also affect a website’s Google rank, leading to a reduction in traffic.
Furthermore, if there are more ads than content, Google might consider it to be a violation of Webmaster guidelines. And, finally, advertisers don't like to be squashed into a single page.
That's why it is best to optimize the number of displayed ads, even if it means displaying only two ads on one page. The optimal number depends on the size of the ads, length (especially if it's a video ad), and form. Google Analytics is a helpful tool for checking displayed ads optimization.
8) Track the Ads’ Performance
Typically, ads that the audience reaches first have the highest CTR and, therefore, publishers tend to place ads with the highest CPC or CPM in the most attractive positions. To discover that position, publishers need to experiment.
Google AdSense provides some general advice on ads placement, but every publisher needs to find what works best for their page or app. For better monetization, it's best to keep an eye on performance and change the order of ads as and when necessary.
9) Use Flexible Prices and Paid Advertisements
Seasonality is another characteristic of ad revenue. That means that you should expect less revenue in January and June, while holiday season months (Christmas, Black Friday, Valentine's Day, Mother's Day, etc.) will be peak advertising times.
If a publisher relies on ads as their primary revenue source, then they need to adopt a strategy that manages demand fluctuation over the year. Yield optimization is one such strategy.
It allows publishers to make the most out of their ad space, selling all available ad inventory for the highest price throughout the year. Reaching the highest price of your ad inventory is possible through Google Ads auctions, which allows publishers to sell ad space to the highest bidder.
The strategy primarily relies on potential customers' behaviour, making the prices flexible and adjustable, and will depend on multiple external factors such as seasonality and demand.
10) Optimize Ad Sizes
Though bigger ad sizes are better for online ad revenue, users might not appreciate having their screen real estate being dominated by advertising. And given that more than 60% of organic Google searches in the US currently come via mobiles, choosing sizes is something with careful consideration. After all, a good user experience is something that will impact your site rank.
For horizontal ad spaces you can use the Medium rectangle, the 300x250, which is typically used for horizontal banner ads. Alternatively, a Square at 250x250, or a 200x200 Small square, also displays well on both desktops and mobiles.
Vertical ad space can have a high-performance rate and a good user experience on mobile phones, as they can “increase processing fluency”, according to one study. For vertical ad spaces, Google Ads recommends you use the following sizes: 300x200, 300x100, 300x50, 250x250, and 200x200.
Google Adsense uses several banner sizes for its ads, making advertising much easier for publishers and advertisers.
11) Use Different Ad Types and Ad Formats
Since publishers can use a variety of channels—such as websites, social media profiles, video channels, blogs, apps, etc.—the types of ads and ad formats will change accordingly.
Whether the ads are in a text form, image, or video, they can appear as a push notification, banner, native ads, interstitial, or pop ad. Some of these ad formats might have better advertising revenue than others, depending on the industry and targeted audience, and it is always good to test and analyse their performance. Some ad types will perform differently on desktop vs mobile.
It's always good to embrace format diversity on websites, as this generally provides a better user experience and increases the click-through rate (CTR). On top of that, advertisers will appreciate the effort.
12) Choose the Correct Ad Placement
If you’re struggling with low ad revenue, one of the reasons might be wrong ad placement on a website or bad timing for an app. These missteps can cause low ad visibility and can significantly affect revenue.
Check whether ad placements are visible and easily clickable for site visitors. Some will perform better, and others will be less effective. For example, ad space in the middle of the content, below the navigation bar, or within the whitespace has much better monetization.
13) Speed Up Your Website
Sometimes the reason for low ad revenue is a website’s slow load speed. Overloading the site with content, including paid ads, can result in a terrible user experience, lowering the Google ranking.
Publishers can implement lazy load to overcome this obstacle, speeding up the initial page load by first loading the top images or videos. When the user scrolls down, the system loads the rest as needed.
As with any other business, the monetization of apps, websites, or social media accounts requires a well-thought out marketing strategy. It is critical that you constantly track the ads' performances and stay at or close to the top of the Google search page results.
If your ad revenue is not performing as expected, it’s up to you to either troubleshoot the issue or bring in an expert to find a resolution.
Publift helps digital publishers get the most out of the ads on their websites. Publift has helped its clients realize an average 55% uplift in ad revenue since 2015, through the use of cutting-edge programmatic advertising technology paired with impartial and ethical guidance.
Contact us today to learn more about how Publift can help boost your ad revenue and grow your business!