Types of Advertising Revenue
There are 4 types of website advertising revenues
– Cost Per Click Advertising – This is one of the most popular strategies used by search engines such as Google. The advertiser bids on specific keywords for a spot (relevant to their target market) and pays an amount proportional to the amount of clicks by the readers. There are two types of Cost Per Click: 1) Flat Rate Cost Per Click, 2) Bid Based Cost Per Click. In the Flat Rate CPC, the advertiser and publisher agrees upon a cost per click within different areas of the website. In the Bid Based CPC, the publisher holds auction for each advertisement spot. The CPC method had generated billions of dollars in revenue.
– Cost Per Mill Advertising – This kind of advertisement is widely used in different forms of media, which also includes television and radios. The Publisher sells advertisement banner for ‘X’ dollars of Cost per Mill. This is the cost to show the advertisement to 1000 viewers. For example, if a website banner has a Cost per Mill of $30 then it cost advertising company $30 to show the banner on 1000 page views.
– Pay for Performance Advertising – This technique is popular amongst marketing agencies. This is similar to the Cost per Click advertising. The difference is that in order for 1 Pay per Performance to count the reader must not only click the advertisement but they must also perform an action (such as buying stuff from that website, subscribing to the website etc.). The rest of the mechanics works like the Cost per Click method.
There are pros and cons associate with each technique of advertising. Publishers often combine or used one of the techniques to maximize their income.
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