How Do You Make Money from a Blog? Finding & Joining an Ad Network

Last year I started a series on how to make money from blogging, in which I covered the basics of different blog monetization strategies and discussed affiliate marketing in blogging on a more detailed level. The blogosphere was abuzz in 2007 with new CPA (Cost Per Action) and CPC (Cost Per Click) monetization options, which pay publishers on either a sale, a lead, or a click.

But 2008 is going to be all about the ad network, and all I can say to that is that it’s about flipping time. Most emerging networks pay on a CPM basis - CPM stands for Cost Per Thousand impressions (where M stands for the Roman numeral of 1000, for added confusion). This means that publishers are paid a set amount of money for every 1000 times they display an ad on their website. The reason this is an important revenue model is that publishers are paid more consistently than when site visitors need to take an action like in CPA or CPC models. And sometimes, advertisers have either terrible landing pages, insufficient tracking systems, inappropriate ad creative or a clunky shopping cart, all of which are completely out of the publisher’s control and can foil the click, lead or sale.

In the last quarter of 2007, I saw more niche ad networks emerge than in the last two years combined. Ad networks like Casale Media, Tribal Fusion & Advertising.com have been around for a very long time. But they haven’t been a good revenue option for most bloggers for two main reasons :: they either pay very little, or they have high traffic minimums that 90% of bloggers can’t meet. Better options for bloggers started to appear in the last couple of years, like Federated Media & BlogAds, but they were still not available to all publishers regardless of the size of the blog audience.

Most of the ad networks out there now will make you sign some kind of legal agreement, and DO NOT SIGN or AGREE TO ANYTHING without reading it start to finish. There will likely be some tricky things that you need to be aware of if you will be running ads for someone else. Here are some of the things you need to know and look for:

1. Where do the ads need to be placed on my site? Most require that the ads need to be placed above the fold. And if so, your blog template needs to accommodate this requirement.
2. What ad sizes does the network use? Most run the most common sizes, which are 728×90, 300×250, and 160×600. You again need to ensure that your blog template can run these sizes, as not all templates can handle these sizes and still look good.
3. What other ads can I have on my site? Some require the exclusive right to all of your ad space. Some require exclusivity only on the portion of your pages above the fold. Some require that they are the highest ad spot on the page. And still others require that they be the only banner ads, but you can sell text ads. Be very clear about what they require, because the network could drop you if you don’t comply with the agreement on ad placement.
4. Can I still sell my own ads? This is an extension of the previous question, but like I said, some will require that you only work with them or that you cannot join any other ad networks, but can still sell ads directly to advertisers. Be sure you are clear on what you can and can’t sell on your own.
5. What else do I need to place on my site besides the ads to be a part of the network? Many networks will also require that you include some kind of badge or other text that promotes the rest of the network, as is the case with RealGirlsMedia, in our own sidebar. Usually this is included with the ad code, so there is no additional work for you to place it on your site. But you do need to take this into consideration when you make your decision, because it’s going to take up real estate on your page.
6. What is the average price they charge their advertisers? Competitive CPMs range from $10 to $30. From my experience, you can most frequently expect CPMs in the $12-$17 range. Some networks like BlogAds sell ads for a flat rate per week, month, or quarter. Some networks will allow you to set your own prices, which means that you need to know how much to charge to be both fair and competitive.
7. What is the revenue split? Networks will split this CPM with you, 50-50, 60-40, or sometimes 70-30. If you don’t like the CPMs they are charging and don’t like the revenue split, shop around.
8. What are their payment terms? Monthly? Quarterly? How long do they take to pay you? 15 days from the end of the month? 60 days? Can you get paid by PayPal? Or do they cut checks in the mail? Will they pay you no matter what, or is payment contingent upon the advertiser paying them, which means you have to wait for their billing cycle to finish before you will get your money?
9. What happens when they have no ads to run? This is especially important if they require some level of exclusivity, because if they have no ads, and you can’t run anyone else’s ads, you have a problem on your hands.
10. What kind of advertisers do they normally work with? While this may not be in the contract, you do want to ask this question, or look at their existing ads to determine what kind of ads you can expect to run on your site. If they have existing relationships with large, well established brands, this is a good sign.
11. Can I control which ads are shown on my site? Some networks allow you to accept or reject ads that come through their network. Others will simply give you what they have and you have to run them, no matter what. You also might not want flash or expanding ads on your site, so you need to know if you can opt out of these campaigns.
12. What is the term of the contract? 6 months, a year, 3 years?
13. Who will take credit for your ComScore rating? Many networks are requiring that bloggers sign over their traffic so that the network can look larger in their ComScore rating. While this isn’t necessarily a bad thing, if you plan on growing your site to the point that you want to eventually sell all advertising directly to advertisers yourself, then you need to make sure that you can get that ComScore rating back when the contract ends. Otherwise, advertisers won’t be able to find you when you strike out on your own, because media agencies rely on ComScore to find and measure sites to buy advertising from.

New ad networks are appearing every day. And as the industry matures, terms for smaller publishers will get more competitive. Overall, this is great for the industry, as larger sites want to be able to sell more and more ads to their clients, and publishers gain access to higher earnings and better brands that otherwise wouldn’t work with such small sites.

So where do you find an ad network to join?

Remember, some have open enrollment, others are invitation only, and again, some have traffic or page view minimums that you must meet in order to join. Some act more like a rep firm, while others are extremely flexible. Check application instructions carefully to ensure you aren’t wasting your time in applying:

BlogHer

RealGirlsMedia

Federated Media

Adify (Which is a network of 30+ excellent niche networks, including Martha Stewart Living, Forbes.com the Washington Post Blogroll & Mom*Logic)

AdRoll (A more grassroots option that lets sites form their own networks)

Glam Media

BlogAds

Casale Media

24/7 Real Media

Advertising.com

Tribal Fusion

Burst Media

Gorilla Nation

Blue Lithium

Context Web

Quigo

ValueClick

And iMedia connection has a more extensive list of ad networks here

Got any other points to add? Any other hot networks out there to recommend? Or any other questions about ad networks for bloggers and small publishers? Share them in a comment!