#38 – How to Generate Extra Income on Autopilot Using Display Ads

What you will learn

  • How we use display ads on our sites to generate consistent and reliable extra income
  • Which networks to use
  • Trips and tricks to optimize your display ads for extra revenue

Display ads are often met with mixed opinions by marketers. But the truth is that the can provide a consistent income for you site. And with the correct optimization, they can be very profitable indeed.

In this episode we take a deep dive look into display ads. If you’re a newbie, we’ll tell you how to get up and running quickly, including which common mistakes to avoid. If you are more experiences, we’ll tell you how to optimize your display ads for a much more profitable experience.

Resources Mentioned In This Episode

Full Transcript

Welcome to the Authority Hacker podcast, the place to learn field tested, no BS tactics to grow hack your online business, and finally, live life on your own terms. Now, your hosts, Gael and Mark.

Gael: Hey guys, welcome to the Authority Hacker podcast. In today’s episode I am with Mark and we are going to talk about monetizing with display ads, We had a pretty big guest post from John Dykstra the other day, two month ago actually now, on Authority Hacker we he shared a bunch of his tips and tricks and so on, but I think it would be cool that we actually share our own experience, and when we think ads are doing well and not doing well, we do make quite a bit of money from ads, on Health Ambition and on a few other sites as well, and we’ll talk about that. But, let’s just jump right in and talk about the pros of display ads. So, Mark-

Mark: I just want to start by saying what is a display ad in case anyone out there doesn’t know or isn’t quite clear on that.

Gael: Alright, sure, so display ad is essentially an advertising blog that you put on your website, that people can pay in various ways and we are going to talk about the different models a little bit later, to essentially display an ad for their website or product on your site and that is done usually through advertising their work such as AdSense and others. And you get paid per click or you get paid per a thousand impressions or you just negotiate a price with the advertiser usually. That’s CPC versus fixed fee.

Mark: So essentially you are giving away a bit of real estate screen space on your site in order for someone else to put some kind of advert on there. For whatever they want to use.

Gael: Yes, and you just a piece of code on your site, essentially it populates it with ads automatically in practice. It’s not like you have to choose each advertiser and do a lot of work, and actually, that’s one of the pros of advertising, it’s very automated, in most cases you are just going to put a piece of code wherever you want the ad to show up so you know it is going to be a WordPress widget or you are going to use a plugin, we use Ad Inserter on WordPress which is pretty good and you can tell it put if after the second paragraph in my content, or put it above my content, or below my content, give it the code and you are done, then the ad network is just going to take care of the rest and use all sorts of very complicated algorithms based on where the visitor is, which kind of platform he is on, all sorts of things to decide which ad to show.

Mark: generally, it will scan your page where it is being displayed and identify what type of content is on there and serve best according to that really.

Gael: Well, not only, because now retargeting is a big thing, right, and that is actually one of the pros of display ads, is like before if you wanted to make good money from it, you had to go in one of these high CPC niches as people would call it, but now, not anymore and that’s what gave us the rise of these viral story sites, because these sites get a lot of traffic because they share funny cat pictures and whatnot, and they can put ads around which normally would return very low paying ads but because there are new ways of bidding for advertisers such as retargeting, actually the ad revenue from these is actually pretty alright now, it’s not as high as if you were in like an [03:33 inaudible] niche, but the traffic they get is like a million times more, so it’s also, that’s why these sites can essentially live mostly from that.

Mark: And I think as well when you are first starting out, you haven’t really spent too much time researching and getting affiliate offers or creating your own product or something, its like a nice kind of starter, it’s not too much effort to get it up and running.

Gael: I disagree. Because, usually when you are at that point you don’t have that much traffic, and if you don’t have that much traffic you won’t make much from ads anyway. And to make good money from ads, that was one of the cons actually is that you need quite a bit of traffic, you need thousands of visits per day, to make decent money, otherwise, you are going to make a few bucks a month, but it’s nothing special.

Mark: Yeah, I remember though when we started Health Ambition, it took us quite a while before we did it and I think we had one or two failed attempts at monetizing with it, but as soon as we got to, I think it was like 10 bucks a day or something like that, pretty insignificant, but it was quite a big win, for what was a relatively new site not making much money elsewhere at that point.

Gael: Yeah, but that was like we had a bunch of traffic, we had a bunch of content and so on, like I imagine people listen to the podcast wanting to put ads on their ten articles website, that is just not a good idea, because the thing is, ads make your design look a little bit worse, you know, your site doesn’t look as good, so, when your site doesn’t look as good and looks monetized, it’s harder to get links and shares and all these things that actually push your growth. Therefore, you are kind of trading money for growth, and when you are at these early stages, you need more growth than money, the money that you are going to make is very low, and at the same time is going to be limiting your growth.

Mark: Actually, on that point, something which we do in Health Ambition is we actually hide ads on new posts for like a couple of weeks or something like that so when we are doing outreach to generate links, people see our blog posts with no ads on them but they automatically get put in after few weeks.

Gael: Exactly, because that would limit the growth, if we did outreach with pages that have a lot of ads, then we get more no, people don’t ink as much so, that’s why I don’t actually recommend you until you have like a thousand visits per day, don’t even bother with ads. I wouldn’t go for that, but let’s go back to the pros. One thing that is cool with it is it’s super automated, like you have no management to do this and that’s the only monetization method that allow you to that which is pretty cool and at the same time it’s pretty regular, I mean, if we look at ad revenue we make, it’s probably the most regular form of income we have out of all the income sources, right?

Mark: Yeah, definitely, and it’s tied just so directly to traffic, if you do something that gives you an increase in traffic, it’s pretty much relational increase in income from ads.

Gael: Yeah, so if you are a person that doesn’t want to handle the business side of things of running a website, you just want to focus on content, that’s actually a good monetization method. The counterpart to these being very easy is that this is by far the lowest payout per a thousands visits, when we run email marketing we make like three or four times more money per visitor than we make from ads, so you make a lot less money; however, it’s also a lot less work and you can spend the time you were spending on email marketing creating more content and more traffic and kind of making it for the fact you are making less money per visitor. So, that is cool but once again, once you push the ads as well, it spoils the design of your website which means that you are slowing down your growth which you need to make more money because ads don’t make much money. It’s kind of like, there are pros and cons to that. Let’s actually talk about the networks we use, I think after this discussion we just had, like the questions we are going to get in the comments is “oh, what networks are you suing”, and it’s like coming close to which theme are you using. So, the networks we use, I mean, initially, we started like everyone with AdSense, and AdSense is alright, it wasn’t very good when we didn’t have a lot of traffic, and the reason why is because AdSense just needs traffic to figure out what works and what doesn’t on your site, it tests a lot and if you only get a few hundred visits per day it can’t really test fast enough to optimize, so more traffic you have the more earnings per thousand visits you have actually, so that’s where we started and it’s alright, they pay per on cost per click so we usually put these units inside the content because ads you insert inside the content just get a lot more clicks, as say on John Dykstra’s post; and the other CPC network we use is media.net. Media.net is the best performing network by far, actually this is a network that is run by Yahoo and Bing, and the ads are usually just like looking like blocks of keywords and it’s one of these networks that takes a while to get started, like you don’t make good money for the first months essentially, but after that, it’s basically making double of what AdSense makes for us.

Mark: Why do you think that is, because it looks like a more sort of organic-

Gael: I think one of the reasons is they actually have humans testing. It’s like, AdSense is fully automated, and media.net is actually people, you have an account manager, you can email him to actually design ads to match your website, and so on. And, it just feels like they are able to optimize a lot better than AdSense does because AdSense is like, I mean, AdSense I guess if you do it yourself and you are really good you can probably reach similar results, but yeah, media.net is like in terms of hands off and revenue it’s been the best one for us actually- lately, at he beginning they didn’t do very well, but as time passed, and as we built a history of traffic and so on, they did better and better. And then once you reach, I mean, if you had more than ten thousand visits per month, one thing you can use that we’ve been using is Ezoic. Ezoic is essentially AdSense on steroids so you replace your AdSense with it, and they ahve like testing algorithm that actually does some of that testing for you, and they do a pretty good job at optimizing the revenue on your site, it’s not as good as media.net but as a secondary network for CPC it’s pretty good. So in terms of networks that pay us per click, these are the two networks we use. Then you have the networks that pay you per thousand impressions, and these are usually the ones that we use in the sidebar, because hey, not many people click on the sidebar but they get a lot of impressions, so for us, we use BuySellAds and BloggerNetwork as well, that’s been recommended by John Dykstra so that is stuff that we are testing out. BuySellAds is actually pretty cool because you can set your price and you can put backup ads so you can say hey, these ads on my sidebar is going to cost you 1.5 dollar per thousand views, and if nobody is willing to pay that price, please put this ads in this blog basically.

Mark: One thing I will say about BuySellAds is there is a lot of really badly designed, scammy diet pill type offers people try and buy for your site, but the good thing about BuySellAds is you have to approve or at least, I don’t know if there is an auto approve setting but we have it so you have to approve every add and ever creative that goes on there, so that allows at least some control over how it’s going to look, which you don’t get on other networks.

Gael: That means that it takes more time. So yeah, that is essentially the networks we are using in terms of monetizing with ads.

Mark: Just one question- percentage wise of our ad income, how is that split? Could we say something like 80% is CPC?

Gael: Yeah around that. Maybe 75%, 80% is CPC and the rest is CPM. Usually, if you place your ad properly, CPC just makes way more money, if you get a clickthrough rate but that means you need to put ads in content which, again, spoils your design a bit, reduces the growth etc, so, you are trading growth for money, it’s just and if you put less ads you make less money so it’s really a trade off. So, let’s talk about the cases when people should be using display ads, and they cases when people should not be using display ads. So let’s talk about the times when you should not be using display ads. Because I think a lot of people just don’t get it and using a plugin, we use Ad Inserter, it’s free, you can just get it on the WordPress directory but you can set the categories, you can set the tags, etc, so you can really exclude some types of content pretty easily just using tags for example. but definitely the case where you should not have ads on your page is when you have a proper conversion go other than an email subscription, like, something where people are going to send you money, or spend money, or become a lead for your business. So that could be an affiliate review page or an affiliate page, that can be wherever you have a contact form of lead form- don’t put an ad there, you just struggle to get that visit to get your lead in if they click on that, you get five cents is probably not worth it. Or, if people are about to buy, so sales pages, or pre sales pages, that kind of stuff, you just don’t want ads in there, so make a tag, we use a tag like we call it no ads on Health Ambition, and then if you put that tag on the post or on the page, on the post because you can’t put tags on a page, it’s essentially removing all ads, and that is allowing us to keep that under control.

Mark: I go a step further as well, because, and we do this on Authority Hacker, there is no ads there and that’s because the value, in internet marketing, the value of an email subscriber just the way we have it setup is very high, much higher than it is in health, for example, of one email, so it’s worth it for us to sacrifice ad income in order to get a little bit more email subscribers. Whereas on Health Ambition, it’s not, because the traffic is so much higher.

Gael: There is so much traffic in Health but like a lot of people are just window shopping, just reading free information. So that is good. And, that’s actually going to be one of the cases where you use ads but another case where you can’t use ads is when you have duplicate content on your page which does happen if you repost an article or something, but you are actually not allowed under a lot of terms of service, depends on networks you use but the ones we mentioned, AdSense for sure, Media.net I think also just they don’t allow you to put ads around duplicate content so you are breaking terms of service which means you could get banned and never have the opportunity to earn with them anymore. Which is just not worth the risk in my opinion. And another time when you should not actually is, and that ties back to the Authority Hacker example, which surprises me because I see for example Matthew Woodward runs ads on his site, but when you want to give a premium filter your website, ads are kind of like spoiling the design a bit, they make you look cheap a little bit, it’s just you know that when you go on a site and there is a bunch of ads, it’s never the sites where there is the best content.

Mark: I don’t know, I think it depends on sort of overall look and feel, there is definitely a co-relation but it’s not just quality of content. Some sites are built to feel like a sort of magazine, and you almost expect those to have ads, whereas the more personal-

Gael: Yeah, but that’s not the best content still, you know.

Mark: Well, I mean, it really depends on the site, and somewhere it really is. The Digital DJ Tips are a good example, I mean they run ads. I think they do, at least they used to. And they are one of the best sites about that topic, that I know of at least.

Gael: It’s probably poor management though. It’s like they probably just don’t make that much money. So sorry if you listen to us guys. The truth is, the best sites usually don’t run ads and make way more money running email marketing, it’s true, email marketing makes more money and by pretty good margin. It only makes sense when you have content that attracts people that are only reading free content and leaving and that is the vast majority of people. But otherwise, if you want to make your site look more premium, don’t run ads. If you are like a high end brand or something, you definitely shouldn’t have ads on your site. So yeah, that is essentially three cases when your page has different conversion goal, when you have duplicate content on the page and when you need the site to feel premium- don’t run ads. No matter how much traffic you have. But let’s talk about the cases when we do run ads actually. One of them is when you run non commercial content. And if you’ve been following us in the past, you know that we do produce a lot of free content that essentially sells nothing. And that content is used to build good will, it’s used for link building, it’s used to attract some social media traffic to our site, and then we usually use tactics such as opt in popups and content upgrades to get these people join our email list and that’s how we make money out of it, but you can easily combine these things with advertising without being too much over the top, and usually when you add this to it’s actually a pretty good return investment on free content, you can, if you get ad revenue and free content on Health Ambition like pure information will have made us like over 10 thousand dollars, it’s like a lot of money.

Mark: From a 30 dollar article.

Gael: Yeah, I mean, for one of these we have like a hundred that make less than 30 dollars. But still, it’s like when one of these hits, it’s just makes a lot. And if you combine that with email subscribers and stuff, it’s quite crazy, you transform this 10 thousand into like 30 thousand or something from a single article. That’s when you want to run ads, you can use it to justify creating a lot of free content and free resources on your site, and make money from it. And that makes you get more traffic, get more links, rank your commercial content higher, and at the same time, justify the investment with direct return investment.

Another one is when you are out of offers that convert, it’s one of these things where it’s essentially like the plan B to a failed campaign, like let’s say you did a blog post about how to reverse like mushrooms on your feet or something, not like that I have any but… Like I am just thinking about some health topics. And, you did that because you found a cool offer on ClickBank, and you were like well, I am just going to link to it at the end and people who read the article click on it, hopefully buy the product and I would make some money. Well, it’s been six months, you are getting some traffic to this page but people click and nobody buys, this offer just doesn’t convert which does happen, then you try another offer and it still doesn’t work and the third one, still doesn’t work and then you realize that no offer works, essentially. And, from that point, you have two solutions, one- you create your own product and you figure out how to convert which if all the offers did not convert, it might just be the market that just isn’t in for buying this kind of products, or you just replace the call to action with ads on the content, and you essentially cut your loses and in the long run get some of that money back. So that is one of the cases where you can be using ads as well.

And finally, and that is something that I believe is going to be touching a lot of people that’s when you move on from a website, or you just don’t have time to take care of it, you get busy with other projects, or whatever, and you don’t have time to run email list, you don’t have time to do anything for that site, so you just slap ads all around and you let it be until you sell it or until you get back to it. And at least you will get some money for the traffic if you don’t have any kind of shopping place or something like that, rather than just letting it be there, and make no money at all.

Mark: There is a pretty good example, we started a site I think t was like three years ago or something like that, and we spent a couple of weeks and spent about a thousand dollars on content, and then we ended up not really doing much with it for two years, but I think it actually made a profit just from ads, in that time, when we literally built no links or anything, just kept the server out and the ads sort of made money, it was pretty interesting.

Gael: Yeah, it’s like you could put the site up in like a weekend like that, and it would be a long term return investment. You are talking one, two years. So don’t expect to see your money back fast.

Mark: 50% ROI is better than-

Gael: Yeah, for sure, if you want to spend a weekend doing that kind of stuff, it’s pretty easy and you can just slap ads around and like it’s better than putting your money in a saving account. If you do that properly, if you do a research properly. So that is essentially when you will be using ads, and that essentially concludes all my notes.

Mark: Yeah, one thing I wanted to say is I predict a lot of people are sort of wondering okay, so when should I use ads and when should I try and collect emails, using like opt in forms and pop ups. And, the answer is, for most people, it’s very difficult to tell unless you are able to calculate the value per email subscriber that you have, and unless you are able to break that down in certain ways, unless if you are running affiliate offers you probably won’t be, you can only really that if you have your own products, because, it;s quite difficult to track where sales are coming from, for affiliate offers and how your email list is split up, which types of visitors or which types of subscribers are responsible for the sale. As I said, it’s very difficult, so there is not really a hard and fast rule about this is the point when you should stop doing it or not, I guess it’s just really like a trial and error thing, right.

Gael: I mean, when it’s like a big difference, you see your affiliate income is like, I mean, you see your affiliate income from email is like four times what it is from ads, then that’s when you are like well, okay sure, let’s just remove the ads and optimize the opt ins. It’s like, when it’s quite similar, even by 20%, 30% margin, it’s like you probably run both, and when affiliate overtakes the ads income by a lot then you just remove the ads, essentially.

Mark: Yeah.

Gael: Cool. Well, guys, thanks for listening, and remember, you can actually get a free affiliate marketing training if you review us on authorityhacker.com/bonus, so if you enjoyed this podcast and you want some free training from us, you can drop a review on iTunes and send a screenshot on authorityhcaker.com/bonus, and we will give you access to your free training. So, thanks for listening, and we’ll see you guys in the next episode.

Thanks for listening to the Authority Hacker podcast. If you enjoyed this show, don’t forget to rate us on iTunes and send us a screenshot on authorityhacker.com/bonus to claim your free premium Authority Hacker training.