What do you need to know before setting ad rates?
                     What do you need to know before setting ad 
rates?
John Z
Writes on ad managing using 
ad server solutions, involved with 
Adspeed ad server software.
Let’s say you have created a website that is pulling in a ton of traffic and 
now you want to start monetizing the property by serving ads. This is an 
excellent way to earn some advertising revenue that will help your 
website grow, but if you have never gone the ad serving route before, 
you probably have some questions. One of the most commonly asked 
questions from publishers is how much to charge and what their ad 
rates should be set at. There is no easy answer here because there are 
many numbers of different factors need to be considered before 
deciding on specific ad rates, which may not be the same across all of 
your pages. Setting your ad rates too high could mean missing out on 
advertisers and losing business to your competitors, while setting them 
too low means missing out on potential revenues. Here are some things 
you need to know before setting advertising rates.
Know your website
This is where data is your friend, as it will help you place ads that are not 
only seen, but also clicked on and possibly generated a lead or a sale for 
your advertisers. Make a list of all the web pages, areas and sections 
that are suitable for ad serving. Your homepage is likely to be the most 
active, which is why that is often considered to be prime real estate for 
advertisers. The good news is that you don’t need to settle for just 
having ads on the main pages. However, you do need to set rates 
according to the traffic that each page or section gets. You can’t charge 
the same rate for a spot on the homepage as you do for a page that is a 
lot less active.
Know your page layout
As is the case with your individual pages, the layout of each page or 
section is also important when setting ad rates. A banner across the top 
of the page is obviously going to be a good deal more valuable to an 
advertiser than a small square advert placed near the bottom of the 
page. The size of the ad space and the ad location on the page are both 
important.
Know your audience
People who do not have a ton of disposable income are not likely to 
click on ads for items they cannot afford. The same rules apply when 
you are trying to run ads that have little interest to your target audience. 
For example, if you run a site that is devoted to topics for retirees, you 
are probably not going to see a ton of joy promoting video games. Know 
your audience and their demographics, have a report where website 
traffic come from, find the right advertisers and set rates accordingly.
Know your business model
Before you start running ads, you need to ask yourself what the goal of 
the website really is. Do you want to earn supplemental income or just 
make enough money to cover the cost of running a website, or are you 
looking to grow and have both ads and a membership set-up? Should 
you use CPC, CPM, CPA or a combination of those? Figure out a suitable 
business model will help you determine how much to charge for serving 
ads on your site.
Know ad rates for your niche/industry
Before you get started, do some research to find what your competitors 
do and what the most common ad pricing are used in your industry. You 
also need to know the typical click-thru-rate (CTR) for your niche. Some 
categories have high CTRs while others have low CTRs. If the average 
CTR is high, you should consider charging cost-per-click (CPC, PPC). On 
the other hand, if the average CTR is low, it may be better to set cost-
per-view (CPM) rates. Of course you can be flexible and use a 
combination of both CPC and CPM. Regardless of what you choose, 
there will likely be some trial and error.
About Adspeed
AdSpeed ad server is a reliable & powerful ad serving and ad 
management solution that serves your ads, tracks impressions & clicks 
and reports ad statistics in real-time. Driven by the latest ad serving 
technologies, the goal of Adspeed adserver is to provide a reliable 
platform that can help in executing online advertising strategy more 
efficiently. 
Thank you for spending your precious time in reading this article.