Creating a Flexible and Adaptable Business Plan that Will Maximize Your 2007 Online Revenues & Profits
Perhaps the thing I like most about the Mequoda Internet Marketing System is its flexibility.
This online publishing system is all about maximizing the value of online advertising inventory (website space, email newsletters and email promotions). This is true no matter how you monetize the inventory.
As you may recall, the Mequoda Media Pyramid offers a visual representation of your options for putting your online advertising inventory to its most profitable use. Here’s a version of what one special-interest publisher’s Mequoda Media Pyramid might look like:
Using Google AdSense to Benchmark Online Publishing Revenue
The easiest way to make money online is with Google AdSense. Google provides pay-per-click text advertisements that match the content on your page. You just make great content and drive targeted website traffic in to read it.
[text_ad]
In addition to generating revenue for your online publishing efforts (Google paid out $780 million to its AdSense publishing partners last quarter), Google AdSense becomes the benchmark against which all other uses of your digital advertising inventory must be compared. And since every other use of your advertising inventory requires more effort on your part – any alternative use must produce more revenue per impression—or as we measure it—revenue per thousand impressions (RPM for short).
Put simply, if you can generate $10 in RPM when you run Google ads on a certain web page, then you must earn more when you move up the Mequoda Media Pyramid and use your online inventory for other forms of advertising (other external ads) or internal ads that promote your own branded information products and services).
If I’m making this sound easy, that is not my intention. Deciding how to best use your online advertising inventory requires a great deal of thought, experimentation and a willingness to make changes to your core online business model. The annual budgeting process is a chance to identify the three to five ways you plan to monetize your online advertising inventory over the coming year. You will make assumptions about how to maximize the RPM for your website, email newsletter and solo email promotions. Then every day you will try to meet or beat those projections by choosing the best way to use your inventory.
Choosing the Best Way to Monetize Your Online Advertising Inventory
“It’s all advertising inventory,” says Harvard Medical School Publishing Director Ed Coburn. “Deciding whether to use it to promote your products or someone else’s is just a mater of economics.”
As you’ll discover in this week’s new case study on Harvard Health Publications, Coburn currently chooses to use all of his online advertising inventory to promote Harvard Medical School products and services. Other online publishers like Forbes.com make most of their online publishing revenue selling their advertising inventory to third parties. Still other online publishers like Ask the Builder and The Motley Fool maximize their online publishing revenue by selling most of their website and email newsletter inventory to others (external advertising) and using their solo email promotions to sell their own branded products (internal advertising).
So in the end, the path to the biggest online publishing profits will go to those online publishers who do the best job of monetizing each website and email impression—because the online publisher who can generate the most revenue per impression can also afford to spend the most to make more of them.
How will you monetize your online advertising inventory in 2007?
Share a thought or a question about online publishing below.
