Nov 04

How Much Money Can a Blog/Web Portal Earn?

“If my blog has (insert daily number of impressions or page views of your blog here) how much should it be earning?”

This is one of the more common questions I get asked by bloggers just starting out with making money from their blogs.

On one level it’s a valid question to ask – after all if you’re going to put time and energy into building something it’d be great to know up front what rewards might be awaiting you.

On another level – it’s an almost impossible question to answer because there are so many factors to take into consideration.

As I look across the blogs that I am involved with (around 100 in number if you count b5media’s 80+ blogs) there is a massive variation in the earnings that blogs are pulling in. It is very difficult to make sense of it as it not just a matter of traffic levels.

For example – As I write this I’m looking at the earnings for January of three blogs that I have some involvement with (I don’t get into what specific blogs earn so don’t ask) and here’s what I see:

Blog A: For the month this blog had a total of around 20,000 page views from about half that number of visitors (ie they viewed 2 pages each. The Total earnings of this blog (all from contextual advertising) was $790.91 (USD).

Blog B: This blog had just over 40,000 page views over the month, this time from about 13,000 visitors. It’s total earnings from contextual advertising (same amount of ad units per pages as the other) was $99.08 (USD). it also earned around $35 from an affiliate program.

Blog C: Our last example is a blog that had around 160,000 page views over the month from around 80,000 visitors. It earned $515.12 from contextual ads and somewhere in the vicinity of $2,500 from affiliate programs.

Factors to Contribute to a Blog’s Earnings…

It’s pretty obvious from those figures that there is no ‘normal’ earnings based upon traffic alone. Many factors are obviously at play. Let me unpack a few:

1. Traffic Levels: While the above examples show that traffic is not the only factor at play in determining the earning capacity of a blog – it is a significant one. Whether you’re earning money from your blog directly or indirectly you are almost always going to increase your earning potential by increasing your readership.

2. Source of Traffic: Of course all not all traffic is equal when it comes to earning an income online. As I mentioned in this earlier post, blog traffic largely comes from a three sources – Loyal Readers (including RSS), Search Engines and Referral Traffic (from other sites).

Each type of traffic will have a different impact upon your earning potential depending upon your earning strategies. Lets look at each in turn:

  • Loyal Readers – loyal readers are a wonderful thing to have on a blog because they can add a sense of community and participation. In terms of income generation they are often good if you’re attempting to earn income from your blog via indirect methods. In my experience of picking up consulting and speaking work and even in developing products for sale – most the the opportunities have only come from established relationships that I’ve managed to build with readers.Loyal Readers have also been known to respond to affiliate programs as a result of the trust and relationship that you might have built up with them over time. The longer term and more loyal your reader is the more weight your recommendation is likely to carry. Of course you won’t keep readers loyal for long if your recommendations are not on the money so be careful with that.On the downside – loyal readers are generally not good for advertising in most forms. When a reader sees your blog every day Ad-blindness tends to kick in pretty quickly unless you’re pretty creative with your ads they often go unseen.

    RSS readers are particularly difficult to monetize with ads on your blog as so many of them rarely see your blog if you publish full feeds rather than excerpts.

  • Search Engine Readers – readers coming to your blog after searching for a keyword you have used are a very different type of reader to the ‘loyal variety’ when it comes to what they respond to. Anecdotal evidence seems to indicate that visitors from SE’s quite often only stay on sites fleetingly. The typical SE users is in search of specific information and if they find it quickly they might stay for a little while but if they don’t they are likely to click on link to something else that might be a better source of information or hit their back button to return to the search engine.This makes them almost the opposite of loyal readers in terms of indirect income earning methods. It’s very difficult to build your profile if people are one off 10 second readers (unless you’re good at making them come back).When it comes to more direct income earning methods SE traffic is traditionally more responsive as they tend to be more aware of your ads (if they are well placed and designed) and they are actively looking for information and things to click on that might give them the info they are searching for. This is especially true for contextual advertising like AdSense which can show ads on your site that are triggered not only by what your content is about but on what people came to your blog searching for in Google (or so some people believe).

    In terms of affiliate links – SE traffic is less likely to click them as a result of your profile but could be open to them more just because they are there. They can be hit and miss depending upon your topic

  • Referral Traffic – It is difficult to make generalizations about this category of traffic because it depends a lot on the type of site that is linking to you and the way in which they do it.For example the last two times I’ve been linked to from Slashdot brought incredibly different results in terms of the money earned from the traffic. On one occasion there was barely any discernible difference in my AdSense earnings despite having 10 times the traffic I normally would get in a day. On the next link up earnings increased proportionally with the increase in traffic (it was and probably still is my best earning day ever). I can only really put this down to the difference in tone of the linking post at Slashdot and the type of post that I’d written (which in the later case probably triggered more relevant ads).In general, traffic from larger sites like Digg and Slashdot don’t convert too well with advertising and affiliate programs. There is an opportunity however for capturing these first time readers and converting them into loyal ones which as we’ve said above is good for indirect income earning down the track.

4. Income Stream:The actual method you use to monetize your blog impacts the amount you might earn. This is pretty obvious so I won’t go on about it too much but it’s worth saying here as it’s a definite factor in mix when looking at other factors.

5. Topic: In the three blogs that I mention above I would say the major difference in their earning capacity was their topic.

  • Blog A has a pretty specialized topic that not many would be too interested in (hence it’s lower traffic). On the other side of things it has well paying ads in YPN on a per click basis and triggers ads that are very relevant to the topic. As a result despite it’s low traffic it earns quite well.
  • Blog B has a very popular topic but there are very few advertisers interested in buying ads with those keywords in contextual ad systems. As a result it’s Click Through Rate (CTR) is very low and click values are low also. It’s also yet to generate enough traffic to make much from impression based ads (although there is potential here – it’s a reasonably newish blog). As a result while it has more traffic than Blog A it’s earning considerably less.
  • Blog C is again on a popular topic which doesn’t convert brilliantly in contextual ads in terms of CTR and ad value. It does have a reasonable reputation in it’s niche and affiliate recommendations are responded to well by readers (and they have a good value per sale also which doesn’t hurt).

Why Topic Matters

  • Contextual Ads – Different topics and keywords within topics will trigger different ads in contextual ad programs and as a result will earn different levels ‘per click’ (I write about finding high paying ads in AdSense here).
  • Affiliate Programs – Similarly, different topics will open up different levels of earnings when it comes to affiliate programs. For example a blog about books that uses the Amazon program is only ever likely to make small commissions per sale as the average book might only be worth $20 and the commission with Amazon is generally in the 5-8% range. On the other hand I know of publishers in the financial website game who use affiliate programs that can pay out at $100 per sale.
  • Indirect Methods – Obviously different opportunities (with different income earning potential) arise for bloggers with a profile in different niches. For example a blogger known for his movie review blog might not have much demand for consulting work but could find a way to syndicate his blog to magazines or newspapers. A blogger with a good profile in the PR industry might not get picked up as a writer in magazines but could land himself a well paying job or some consulting work.

6. Age of Blog: – a good wine matures with age – as do many profitable blogs (and most profitable businesses for that matter). There are many reasons why this is the case and while some blogs do seem to rise from nowhere to dominate the blogosphere – most do not. Here’s a few reasons why blogs tend to get better with age:

  • Quantity of content – I find myself saying this to new bloggers repeatedly but don’t expect to get a lot of traffic to your blog until you have a substantial level of content in your archives. Of course quality of content is vital, but at least at some level numbers of posts do count and unless you’re going sell your soul and to get into splogging quantities of content take time. I’ve written more on this here and here (series).
  • Search Engine Optimization – While some SEO experts claim they can have you at the top of Search Engines quickly (and some can), sustaining high rankings through legitimate (white hat) methods means building a site over time. Climbing the rankings in SE’s is the result of many things including good content (lots of it) that gets links from others – both things that take time.
  • Reputation – Building an online profile and presence takes time n the same way that it takes time in real life. People look for consistency in your blogging overtime and will want to see that you not only talk the talk but walk the walk. As you do this you’ll find your readership grows.
  • Network – Connected with a good reputation comes networking opportunities. Two years ago if I had wanted to start a new blogging project with someone else I would have had little chance of convincing anyone to join me – but since that time I’ve worked hard at my relationships with fellow bloggers (and other online and offline contacts) to the point now where my problem is becoming too many opportunities to collaborate.
  • Web Smarts – I shudder when I look back at my first blogging efforts and how naive, ill-informed and poorly run they were. I have a long way to go when it comes to learning about the web, blogs, design, writing etc – but over time my own skills and knowledge in these areas have grown. You can read all the books, blogs and articles you want on blogging (and I’d encourage you to do so) – but so much of what you can learn about blogging for money has to come from on the job experience – which again only comes with time.

7. Time Invested: Lastly I’ll add that the time a blogger is willing and able to invest into their blog is a factor worth considering. I’m fortunate enough to have been able to work myself into a position where I can blog full time. This didn’t just happen overnight (I attempted to describe the process here) but as I was able to put more time into it the rewards increased. This is a bit of a catch 22 situation of course (the more you earn the more time you can put in and the more time you put in the more you can earn) but it’s a principle I’ve discovered that is worth adding into the mix.

So How Much Can a Blog Earn?

I’ve been avoiding the question for over 2000 words now and I’m not about to put a definitive answer on it except to say that every blog is different and the evidence that I’ve seen from interacting with thousands of bloggers and their blogs over the past year is that bloggers are earning anything between nothing at all and millions of dollars. The upper end of the spectrum is of course rare and those earning very little are in the majority, but bloggers earning decent income is becoming increasingly common. Here’s a couple of recent ProBlogger polls that might illustrate how the spectrum is spread in their earnings of AdSense and Chitika.

I’ll finish with this:

Probably the best way to find out what you can earn from a particular blog is to start that blog and test the waters.

Give yourself a time limit of a few months to get a feel for the topic and see how it goes. While it’s important to realize that a few months is not really enough – it is enough to get an understanding for whether it’s a topic you feel you can sustain, what the click values and CTR might be in contextual ads and even to get a feel for what type of readers you’ll attract. If the signs are good – invest more time into it – if they are not, consider trying something else.

That’s my 2 (or 2000) cents worth on the topic of how much blogs can earn. What’s yours?

Source: http://www.problogger.net/archives/2006/02/23/how-much-money-can-a-blog-earn/