How Much Should You Charge for Banner Ads On Your Website

I am writing this article in response to a question that was sent me that goes..

“Hi Mr Sencio. I’m just wondering where you are based because my question has something to do with where I’m from which is here in the Philippines. I made a website and I want to start asking sponsors to help me pay for my own domain. How much does a website charge for ads?”

First of all there “there are no standard pricing structures across the Internet” for banner ads. The only way to determine how much you should charge is to see how much other sites just like yours are charging.. and by other sites I mean, websites with similar traffic, demographics, banner sizes and location on the page or on the website.

Traffic
Advertisers are paying for exposure on a website, so they put their ads on websites that have traffic. If your website does not have any, it is likely you will have a hard time getting anyone to book ads on your website.

Demographics
More than just exposure, advertisers want the right exposure. They want to reach out their target audience who are the people they see buying the product or service they want to advertise.

Banner Sizes
There are many different standard banner ad sizes, and pricing is obviously also influenced by size. The bigger the size, the bigger the ad creative you can use, and the clearer an advertiser’s message may be read by the web site’s visitors.

Location on Page/Website
Where a banner ad is found on a page, or what page on the website also affect price. Think of banner ads as billboards; the ones that are easily seen by motorists and the ones that are on a busy street usually cost more than those that are not immediately visible or those that are in back alley.

Banner ads found visibly near the top of the page or anywhere above the fold (the lower edge of the visible webpage before a visitor scrolls down) are usually higher in cost. Furthermore, banner ad locations on the main page or pages that get the most number of views usually cost higher than other pages that have less page views.

Whether you are in the Philippines, the US or anywhere in the world, banner advertising is an Internet commerce channel that knows no boundaries and more importantly largely unregulated with standardized pricing. It really comes down to the value that your website offers to potential advertisers and being able to convince them spending their ad budget on your site is worthwhile, otherwise they can easily find another website that is cheaper than what you are offering and may beat you in the aspects of traffic, demographic, size options and site and page placement.

How Other Websites Charge?

Flat Rate – Where you simply charge a monthly rate for the exposure you are giving them on your website.

Per CPM – A little more complicated, it stands for cost per thousand, where an advertiser pays a certain dollar amount for a thousand impressions. This is often the standard method used, and common among large websites with a lot of traffic and a lot of potential views of these pages.

Per Click – As it suggests, an advertiser pays a certain amount each time the ad is clicked by a viewer, a little more complicated to implement and needs more advanced software and tracking mechanisms in place.

What to Do Next?

Start promoting your website in order to get more visitors to it. You should also have some sort of tracking mechanism in place for you to see how many visitors are getting. Later on you would need to determine the demographic of your visitors, and that is largely influenced by the content of your website and how easily your website is found through links on other websites or through search engine listings.

Lastly, I am a Filipino in New York City.

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