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.
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.