Bartering Advertising to Your Advantage

I think in previous posts I’ve proven my point that advertising should never be the sole source of revenue for an online business.  In addition to all of the reasons I mentioned previously, there’s another one that’s often overlooked:  bartering advertising.  If your only source of income is ad revenue, you guard each impression as if your life depends on it…you won’t dare trade it because you need to get top dollar for it.

However, if you’ve got another source of revenue (or two or three other sources of revenue) you can barter said advertising to drive more qualified traffic to your site.  Since you’ll likely get only a few dollars for each thousand impressions, a lot of the time advertising is more profitable being bartered with a site that can drive targeted customers looking to buy whatever else you’re offering.

Example:  the large 336×280 that we have on SportsLizard’s home page is shown between 5,000 and 10,000 times each month (the majority of traffic enters the site from pages other than the home page, like the customs section or the price guide).   We used to show AdSense there and get at best $2 CPM.  So on the best of months we’d make $20 from that slot.  Now that slot is occupied by SportsCardFreaks, a sports card forum that we partnered with.  I put their ad on our home page and made an announcement that they are the “official forum” of SportsLizard, and in return they put up an ad for SportsLizard’s Price Guide in their forum.

SportsCardFreaks on SportsLizard

After about a month, we’re getting just over 1 Premium Account signed up per day from the ads on SportsCardFreaks.  Those users are the *perfect* user for our Price Guide because they’re the “hardcore” collectors. We end up getting a new $5/month sign up EACH DAY by giving up that $20/month spot on our home page.

Just one example, but I bet most sites could benefit from similar thinking.

5 comments on Bartering Advertising to Your Advantage

  1. Not a bad ROI. $240 with adsense per year or $21,000 in signups.

    Schrewd move.

  2. Adam McFarland says:

    Geeze, when you put it that way I look like a genius 🙂

    But it’s not quite as good as that…people do cancel from the premium account. Over time we seem to be keeping over 40% (although we’ve only got 6 months of data to go on). There’s also a 7-day free trial, and some cancel before that ends and we get $0. I’d say though it’s not a reach to say we’ll make $7,500 from the one-user/day for the year if this keeps up. They also have a finite number of active forum members, so it might not keep up at this pace unless they add a lot of active users.

    Either way, I think you just proved my pt Aaron – advertising trades can be used to make you more than you’d make from just selling the ad space.

  3. Anthony says:

    Great thinking. The thing about advertising on the web that makes me sick is that to most people, it’s no longer part of a business plan, it’s just a given. The same people who pride themselves for doing something novel by starting a “web 2.0 business based on an advertising model” are actually just following convention down to a tee. And the catch 22 is that advertising, as you have proven over and over, doesn’t really pay until your site is successful. Which means most modern websites either need to have a lot of dumb luck, a lot of VC money, or figure out a way to first make a profit and grow using anything BUT advertising.

  4. Adam McFarland says:

    “And the catch 22 is that advertising, as you have proven over and over, doesn’t really pay until your site is successful. Which means most modern websites either need to have a lot of dumb luck, a lot of VC money, or figure out a way to first make a profit and grow using anything BUT advertising”

    That is a GREAT sentence

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