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Ad Sales Options for Small-Site Owners

  |  December 1, 2000   |  Comments

You're a small-site owner with ad inventory to sell. But you don't have much money or time. Is using an ad network your only choice? No. Here's a do-it-yourself solution that can win you bucks AND save you time.

This week, I thought I'd start a series on the issues of selling advertising. Specifically, I want to talk about how to create an advertising program if you're the owner of a small site and have limited financial resources.

Now, you could take the easy way out and have one of the many fine advertising networks out there sell your inventory. But the truth is that all they will do is sell banner ads on your site. That strategy doesn't squeeze the maximum value out of each impression. And with $0.03 being the average going rate for an impression (according to the latest report from Engage AdKnowledge), a small site doesn't generate enough traffic to make an impression-based advertising model worthwhile.

In my career, I've worked for two companies that have taken small online properties with limited resources and built profitable advertising models around them. And what they have in common is that neither has an impression-based model. Instead, they sell high-dollar sponsorships, which are essentially packages of online ad vehicles that the advertiser can take advantage of.

There are three major advantages to this strategy:

1.) The advertiser gets more value.

Online advertising vehicles used independently tend to offer limited results. But when used together strategically, they make a greater impact on an audience. Plus, by offering multiple ways for an advertiser to thrive, you create more chances for them to succeed. And that leads to a repeat advertiser.

2.) The per-transaction overhead is lower.

For a small operation, about the same amount of work is involved in closing a $100 banner deal as in closing a $5,000 sponsorship deal. So, it is cheaper for you to focus on securing a handful of high-dollar quarterly or annual advertising contracts than on several low-dollar monthly banner advertising contracts.

3.) You can charge more.

A banner ad, a direct email mailing, and almost every other online ad vehicle have a perceived value that has already been determined by what everyone else is charging. No sales speech, however pretty and convincing, will change that. But if you can offer a package of online ad vehicles designed to work synergistically, there's nothing really to compare it to. You've created a unique offering that you can charge a lot more for.

So with this in mind, let's outline what we will talk about over the next four weeks.

The first thing you need to figure out is your offer. What is the ad package you are selling? There are two successful ways I've seen the issue tackled for a small site. One is the paid directory model. The other is sponsorship of a content area. We'll discuss the pros and cons of each.

The next concern is how to build your site to incorporate either the directory or sponsorship ad model. The larger and more significant issue here is how do you incorporate the advertising so that it enhances, not interrupts, the visitor's experience?

Once you've figured out the site structure, the next step is determining how to manage the influx of content from your advertisers and its placement and rotation on the site. Sounds complex, but it is easier (and cheaper) than you might think.

Finally, it's time to develop your sales strategy, which includes your value proposition, your pricing, and how to pitch so you close the deal. And you need prospects to sell this offer to. So we'll talk about how to find them and who NOT to go after. (Hint: The company selling a $5 widget isn't a prospect for these kinds of ad models.)

Type at you next week!

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Richard Hoy

After five years of telling others about how to spend their marketing budget online, Richard Hoy recently left the employ of this influential publication to see if what he's been blabbing with his big fat mouth all these years really works. He is President and Co-founder of Booklocker.com Inc., an alternative to traditional publishing that helps authors realize profits of up to 70 percent of sales by combining electronic publishing with Internet marketing.

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