It's All About Putting Yourself Ahead of the Pack

Let’s talk about an issue near and dear to my heart: pricing.

You may be in a competitive area where the CPMs are dropping and wacko competitors with no skin in the game are accepting whatever deal comes their way. And those wily media buyers who, after all, are just doing their job remind you that your pricing is way out of whack with what they can get just a few URLs down the road.

Whats a seller to do?

Reality dictates that to a certain degree, you need to stay within certain parameters when pricing your sponsorships. All things being equal, you can’t expect to get a $100 CPM when everyone around you is getting $10 to $20, max.

But there are some things you can do to enhance your revenues, even in a competitive market.

Define Your Site In A Unique Manner

The first thing I would look at is strategy. Ask yourself the tough question of how distinct you are from the other guys out there.

If you have a shareware site, for example, is it the same ol’ stuff I can find at TUCOWS or Download.comor a dozen other places? Or have you distinguished it in some way?

Have you carved out a special niche or expertise within particular genres of shareware that nobody else is addressing? Do you provide better information than the other guys do? Do you have more points where people can download? Do you have some way of attracting people to your site on a regular basis? Have you built a list (also sponsorable) that delivers daily updates to your readers?

These are all little things you can do to differentiate yourself from the rest of the pack. Sometimes, the difference is noticeable enough that even the sharpest media buyer is willing to pay a higher price, just so they can showcase their client’s ads on the best site in the category.

I can’t emphasize enough how important it is to NARROW the definition of what your category is, and to make your site BEST of category. (That’s our goal here at ClickZ Network, by the way.)

Create More Ad Vehicles On Every Page

The second way to maximize your revenues in a tight market is to find a way to design more advertising and sponsorship space into your pages. Our model calls for one or two banners at the top of the page and two 120×240 ads on either side of the content. (With an occassional 125×125 thrown in for good measure!)

If you are selling ad space for a $15 CPM, that translates to $60 CPM of value per page. And frankly, you should charge more for the 120x240s, because they stand out more. So call it a $75 CPM, or $.075 per page impression. You can probably do okay with that kind of value.

There is a risk, however.

The risk is this. When you have more than one ad unit on a page, by definition, the click-through rate goes down. You may have a page on which 2 percent of the visitors are clicking on ads (which tells me you have weak content, and that they are using your ads to leave your site). But with four ads per page, the click-through rate will be under 1 percent.

And you need to be up front about that. Some advertisers can live with it, others cannot.

As an aside, you need to recognize that the “2 percent average click-through” is a total falsehood. That number is based on a test that was conducted over two years ago from a sampling of 500K impressions.

It was a whole new world back then, and the internet was a different animal entirely. Banners were new and interesting, far more likely to be clicked upon for novelty sake.

As the internet audience matures, they are less likely to click on ads.

As YOUR audience gets used to coming back to your site on a regular basis, they are less likely to click on ads they’ve already seen them.

So it’s time for us all to be truthful about click-through and focus more on how you can help your advertisers build their brand and their business. And even with a low click-through, you can help them if your audience represents a likely market for their products. You just need to offer them a little something extra.

Add Value In Unique Ways

Which brings me to my last point.

Let me give you a great example. I once bought some advertising from Richard Ord over at NewsLinx. Beyond having a great site filled with constantly updated internet news links, he’s built a heck of an audience. He’s got a substantial number of visitors coming to his site daily as well as a huge mailing list of over 100,000 who receive his full list of news links at the end of every day.

I saw some common ground there, and asked what we could do to help me build my list of subscribers. He put up a small signup window on the sidebar and the top of the home page which helped build subscribers to a certain extent.

But then, he went above and beyond the call of duty.

He wrote an email to his base of 100,000+ subscribers praising ClickZ, telling them how he read our articles daily (which is true) and invited them to subscribe to our daily publication. Results: 1100 new subscribers in a single day, expanding to 1500 in two weeks. Not bad for a single email.

That single act made it worth doing business with Richard, and it might indicate to you what could be done to provide added value to your advertisers. Maybe you can’t do for your advertisers exactly what Richard did for ClickZ, but there are probably some ways you can add value that you aren’t doing now.

Otherwise, you’re one of the pack. And if you are one of the pack, you might as well drop your drawers right now.

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