Monetizing Your Blog: How to Figure Out Your Banner Ad Rates
By: Cora Harrington

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Despite the increasing popularity of new ad types like native advertising and programmatic ads, banners are still one of the most popular forms of advertising, and they’re usually the first kind a blogger tries when beginning to monetize their blog. A banner ad is basically a brand paying you to upload their image to your site. Your readers then view that image, leading to increased familiarity with the brand. Eventually, some readers will click that image or visit the brand on their own, which will lead to sales. Both you and the brand win.

… When I first started monetizing my blog, I had no idea what to charge for banner ad space. Even more frustratingly, getting a firm answer from anyone seemed impossible

However, even if you want to try banner ads, there’s still the question of, how do you price them? I know when I first started monetizing my blog, I had no idea what to charge for banner ad space. Even more frustratingly, getting a firm answer from anyone seemed impossible. In retrospect, I can understand why other fashion bloggers were reluctant to reveal their rates. What you charge depends not only on your traffic but also on the economy, your niche, your popularity (word of mouth, press mentions, and social media), your SEO (do you appear in search engines for terms the brand wants to be known for?), and somewhat more vague things like fit and timing. With all those factors, how can any blogger, especially one just starting out, know what to charge?

Find the Sweet Spot

The ideal price point for banner ads is one where they’re priced low enough to actually sell (ideally, you’re close to sold out most all the times) but high enough to maximize your revenue, and – this is a key point – not devalue your brand. Many bloggers, especially when they’re just beginning to offer ad space, undercharge. That’s a problem for both you and for other bloggers. For you, undercharging may sell more ad space in the short term, but it makes it harder to actually get paid what you’re worth in the long term. Undercharging also affects other bloggers by artificially lowering the going rate, and making it harder for everyone to sell ad space. In short, it’s in all of our best interests for you to have a good idea of what a banner ad on your blog is worth.

There are several available methods to determine banner ad rates, but whatever method you use should be flexible enough to take into account factors like ad size (larger ads tend to cost more than smaller ads) and ad placement (ads above the fold tend to cost more than ads below the fold). Before you even begin offering ad space, I recommend either placing an affiliate ad in one of those spaces or working with a brand you like to exchange ad space for data. Knowing information like click through rates and order rates (a.k.a. purchases) will prove invaluable to your ad sale efforts, either by being an addition to your media kit or by being part of verbal talks with a brand when you’re convincing them to advertise with you.

CPM, CPC & CPA

Methods for determining online advertising costs usually fall into one three categories: CPM (cost per mille or cost per 1,000 views), CPC (cost per click), and CPA (cost per action/acquisition or sale…basically, an affiliate arrangement). Today’s blog post focuses on the CPM model, where a brand pays for the number of eyeballs that will see their ad in a give timeframe, not the number of people who will click the ad or the number of people who will make a purchase through the ad. In addition, this post assumes that you’re selling your ad space yourself directly to brands, not going through a blog ad network or other third party.

Get Another Blogger’s Media Kit

The easiest way to figure out your rates, of course, is to get a copy of another blogger’s media kit (preferably a blogger the same size and in the same niche as you) and just copy their ad rates. That doesn’t really teach you how to determine your own ad rates, but it can help you get started. It also provides a reference point (i.e. you’ll be able to speak intelligently about what other bloggers are charging in your niche).

Start Out Simple With Formulas

A second way to figure out your ad rates is to charge $1 per 1,000 page views each month. This is the method I used when I was started advertising, and I liked it for three reasons. One, it’s easy to figure out. Two, it’s easy to explain. Three, it allows for natural price increases as your traffic grows. The way this method works is simple. If you’re getting 25,000 page views a month, a banner ad costs $25. Some bloggers even choose to set that CPM rate at $0.75 or $1.25. It’s really up to you. Ironically, as you grow, you may find yourself charging a bit less than $1.00 per 1,000. If you find yourself getting 500,000 page views per month, your particular market may not be able to support a $500 ad space.

A third and final (for this article at least) way to calculate ad rates is to take your daily visitors and divide by 10. This method works especially well if you sell short term ad space (on the order of per day or per week), as you can maximize profitability over that smaller period of time. So in this example if you’re getting 800 visitors per day, your monthly ad rate would be $80 and your weekly ad rate would be $20. You’ve probably noticed that this method figures out to a higher monthly rate than the previous method. Please remember that one isn’t necessarily better than the other; it’s all about what works best for your blog.

Google Analytics

One quick word on coming up with your traffic stats. Keep in mind that not every stats program is created equal. I recommend using Google Analytics for your stats info. I’ve found that it’s not only the most reliable, but it’s also the most trustworthy (which is important if a brand asks for a screenshot to verify your numbers).

Start Making Sales!

Once you’ve figured out how to come up with your rates, then it’s all about making sales. Some bloggers offer discounts or bonus time for longer term contracts or speedy renewals. Other bloggers offer tiered ad rates, charging less for an Etsy designer than, say, for a national or multinational corporations. Like many things, it’s all about trial and error until you get it right.

What did you do to get those first ad sales? How did you determine your rates and what advice would you offer to bloggers thinking about starting banner advertising? Let’s get a discussion going in the comments.

[Image Credit: Shutterstock.com]

Comments

  1. Miche says:

    Wow – thank you SO much for this article – like you stated in it early on, it can be really frustrating to try to figure out and no on throws out real numbers. Currently I get about 6-7,000 pageviews a month so I’m not quite sure I can monetize yet – any advice on how many views at a minimum you should have before trying to sell ad space?

    http://www.buttonsandbirdcages.com

  2. Avatar of Nancy
    Nancy says:

    This is super helpful. I actually just received an email today asking my rates/

  3. Ashley says:

    I just started my blog/vintage shop about a month ago. I am nowhere near where I would need to be to start selling ad space, nor have a found much information on how to price when I get there. I haven’t actually found much information all together about how to get started in monetizing or getting to the point of being able to monetize my blog. This is really the first helpful article I have come across in setting my goals. I can see where I need to be, now it is just getting there! :) Thank you, this is great!

  4. Samantha says:

    Thanks for the advice! I’m just starting out and it’s my first full month of blogging. I’ve only had about 8,000 hits this month so it’s a bit early to be thinking of monetizing but I’m saving this article for later use! Thanks!

  5. sneha says:

    This article is extremely helpful for people like us. I want to know more about selling ad space on the blog and also about affiliate marketing programs.

  6. Mimi says:

    Thanks for the great article. I am too small now to sell ad space but this gives me the goal and right way to go about it in the future. Thank you.
    http://www.callmemimi.com

  7. Avatar of Aiko Miyoko
    Aiko Miyoko says:

    I’ve been garnering about 2-3k pageviews daily but I have never really taken this whole ad advertising seriously although I have a media kit readily available. Maybe it is because I also own a YouTube account that is doing fairly well. Maybe should look into it a little more and as always, great post.
    http://hapyshoppe.blogspot.com/

  8. Thanks for the article, it’s really great.

  9. Brooke says:

    I am with the others on this one. Great article, I actually just printed it out so I can come back to it when I want to start monetizing. I do have a question: does anyone ever get pressure from brands to have daily posts? I just started my blog a couple of months ago, and I have only been posting 2-3 times a week. Just wondering if this would play a factor?
    Thanks so much for sharing!

  10. Matthew Pike says:

    I’ve had ads on my blog for a while now and I find it best to go with brands and companies that fit your niche and let is grow from there. For instance I feature a lot of small/indi brands so that’s who I like to advertise with me, they don’t have the budget of some but it works with your own personal interests as well as your readers.

    http://www.bucketsandspadesblog.com

  11. Thanks for this very informative article. I have a fitness blog and I’d like to ask when should a blogger start thinking about selling advertising space? Is there a page views threshold?

  12. Elle says:

    Thank you for the wonderful article! I have a Women’s fashion website called: http://shop.ellezone.com. Would love to have more sponsors, too

  13. Avatar of Onianwah
    Barbara says:

    Hey Cora, thank you so much for this post. However, I was wondering, for those of us with way less than 1,000 page views per day or 500,000 page views per month (mine is an average of 200 – 300 page views per day and 11,000 per month) how do we charge and still make a profit?

    Also, there are not any real professional bloggers over here and those who make money off blogging do so on a really grand scale. So for those like me who are trying to carve a niche for ourselves and still build professionalism out of blogging, how can we go about it?

    Looking forward to your reply to my comment.

    Barbara
    http://www.barbara1923.com
    Lagos, Nigeria

  14. GREAT post! I have gotten so many emails in the past asking how much I charge and I was so clueless on how to figure it out. Now i know better.

    -Eden

    http://www.flashframephoto.com

  15. Broderick says:

    Great info! I’m just starting out and will file this information away when the time comes. Thanks for the post.

  16. Avatar of Nasreen
    Nasreen says:

    honestly, im still so lost. You should make a post that is a beginners guide to monetizing from the start etc.

  17. Alex says:

    Thank you for this post! It’s very helpful information about calculating ad costs even if you are a smaller blog with not that much visitors!
    -Alex

  18. Hangar 217 says:

    Thanks! This helped a lot!

    A quick note: one of the biggest fashion newsroom of the web + online portfolios + fashion job board : http://www.hangar217.com

  19. Avatar of Ascending Butterfly

    When articles like this are posted they tend to generate what I call ‘sneak attacks’ please add on to be direct when asking someone for their Media Kit, don’t pretend to be a Brand (experienced bloggers will see through it anyway) and if you don’t get an answer don’t assume you are getting snubbed, most people have to prioritize emails that are fishing expeditions from legit brand emails. You have better luck approaching a blogger you actually know then you would just emailing bloggers at random and asking them their rates.

    Tracy @ Ascending Butterfly

  20. Knowstyle says:

    This was great help, love fashion tips and always aim to promote Style. http://www.knowstyle.co.uk

  21. Olivia says:

    What a great blog post! Similar to other bloggers, I feel like I’m still so new and I’m unable to monetize my blog. However, I think it’s a great idea to start to put together a media kit!

    Corporate Catwalk
    Facebook Page

  22. Avatar of Layla
    Layla says:

    Wonderful post, this has actually helped me out as I was thinking what to charge for banner ads…I’m all sorted now! :)

    Layla x

    http://www.sprinkleofstyle.co.uk

  23. Its a great article and really thanks a lot for sharing it to all of us we are very much thankful to you.

  24. Avatar of Clement
    Clement says:

    Thanks for this very informative article, I now know where I am headed.
    http://www.9jafrikfashion.blogspot.com

  25. Avatar of Kimberly
    Kimberly says:

    Also about categories, it’s good to only assign each post to ONE category. Search engines don’t like to see repetitive content, and since a SE treats each page almost like a separate website, assigning one post to muliple categories isn’t as effective as just assigning it to one.

    That title tag is a huge deal too — I changed mine on one of my sites and my sales nearly quadrupled, I’m not even lying. The first text on your website should be keyword rich as well because that’s generally what search engines use as your description.

    It’s also good to make sure that search engines don’t crawl and index your tags (for the reasons I stated above). There’s a way to turn this off in most wordpress SEO plugins.

    http://oohlaluxe.net

  26. leodeck says:

    i want to know more about selling ads when will i be able to sell ads on my blog am soo lost and i want to make money from my blog this is my blog address pls help me
    Leodeckworld.blogspot.com

  27. What a wonderful article. I enjoy reading about bloggers. Although I’m a clothing designer, I love to blog. It’s my relaxation so I started blogging about fashion and style. A natural use of my time. My newest blog is at 4,000 page views a month and climbing fast since starting it just a few months ago. Looks like I’m on track for success, but i think if i didnt have my own products to sell, it would be difficult to make blogging a full time job.. ;0) Jax
    Wow.blondibeach.com

  28. Adam says:

    Thanks for sharing this, I picked up some good tips from this.
    I also have something to say to the community: Don’t forget to share your pages with ads on your social media sites, like fb fan pages, twitter pages etc. I always get some good leads and clicks when I update my fb status about some new posts to my fans, especially if you rich-describe your content in a status and people like it –> Their fb friends will also see in and they are your potential customers too!
    Keep it up and have a nice day,
    Adam

  29. Really valuable article – totally agree- this is exactly how i deal with ads.

  30. Audra says:

    I actually had a somewhat random questions about your website :) I LOVE your social media icons to the right of your blog title post. Is there any way you might share a tutorial? Well done!

  31. Jenna says:

    SO happy to see this article, since this can be a very confusing topic for new bloggers. However, I did have a question regarding the method you referred to below:

    “If you find yourself getting 500,000 page views per month, your particular market may not be able to support a $500 ad space.”

    Does this mean charging $500 for ad space that would appear for an entire month? Or per day? etc. I’m also wondering how often you should rotate your ad space for other brands that might be interested vs. leaving the same ones up for long periods of time.

  32. Jenna says:

    SO happy to see this article, since this can be a very confusing topic for new bloggers. However, I did have a question regarding the method you referred to below:
    “If you find yourself getting 500,000 page views per month, your particular market may not be able to support a $500 ad space.”
    Does this mean charging $500 for ad space that would appear for an entire month? Or per day? etc. I’m also wondering how often you should rotate your ad space for other brands that might be interested vs. leaving the same ones up for long periods of time.

  33. Avatar of The Fashion Cafe

    This is so helpful!
    A company contacted me a couple of hours ago and I didn’t know if I should start monetizing or not, but thanks to this blog I see that I still need to grow some more before starting to monetize.

    http://defashioncafe.blogspot.com/

  34. Mattie says:

    Thanks for sharing the ad rate formula that you used, it is nice to see it quantified somewhere, I was operating in the dark on that one before.

    I can’t remember the numbers exactly but Guy Kawasaki once famously explained how in his first year of blogging, with millions(?) of page views, loads of effort and a crazy amount of content he only made about $5000(?). Ouch.

    I first started with Commission Junction affiliate ads from my favorite designers and that worked better than say a Google Adwords campaign but it didn’t pay a lot. I felt like I was chasing pennies on the dollar.

    Charging for ads is definitely more lucrative, but the problem was that filling the ad spots became a full time job and it detracted from what I wanted to do … which was BLOG and build relevant site traffic.

    I completely changed my approach and have had much better results by targeting LOCAL everything. Let’s face it, my blog will not compete with Vogue magazine in SEO rank, but I can outshine them in local search words. So I joined Maeok, which lets me purchase fashion as a fashion stylist ambassador merchandiser whatever they call it and then I blog about products, do trunk shows with local boutiques, post my articles on FB, Twitter, you name it so that I rank for that key word LOCALLY and now I have become the, well, a go- to resource that local news outlets use when they want the scoop on trends, and that gives me an extra push in traffic. When I sell the fashion items at trunk shows (jewelry, scarves, flats, accessories, handbags do much better), the local media gives me a nice little bump (even Daily Candy!). So I make more than a banner ad pays and it is circular, it keeps driving traffic to me locally and I can command guest space with boutiques for special events. I haven’t been invited to red carpet events…. yet… but stay tuned:)

  35. Karina says:

    Fantastic post! All the info I’m trying to figure out for many many months. Straight forward and to the point, can’t thank you enough for sharing this valuable information, and where have I been that I’m not subscribed to this blog?!

  36. Pearl says:

    I just stumbled onto your site while researching ad rates. Thanks so much for the article, it answered a lot of questions for me. Now I just need to put your advice into action.

  37. Sid says:

    I was just googling “how much to charge for advertisement on website” and I landed here, Really helpful info for the new people in the market.
    http://www.chatfrndz.com

  38. I got a ad request some days ago but that time i did not know; what to charge for it. After reading this post; i am now able to calculate the price of my ad space.
    Thanks to share such a useful article.

  39. Lindsay says:

    Wow, I’m way behind! I currently get around 2k views/day when I post, around 1,500 when I don’t, so it sounds like it’s time! What company do you recommend for handling ads?

    Thanks!

  40. Just looking for such posts. That’s really a great post. The post’ll help me too much. Thanks for sharing.

  41. Joanne says:

    This was a very helpful post. I have been contacting about my ad rates and I have not set up my blog to have ads yet. I am on wordpress.com and need to move over to something that can support banner ads. I am getting enough traffic that I think it would be worth it now. I get about 20,000+ per month. This was a great help! Thanks

  42. Gregg says:

    Thanks for the helpful post. I started up a website with a review on a popular book and a PDF download which is getting over 10k unique visitors per month now. But 80% of the visitors are from India, legit users not spammers. But I have no idea how to monetize to that audience or that is even possible. Does anyone have some ideas?

  43. Such a tricky thing to work out but thanks for the advice!

  44. Avatar of AngelMeow
    AngelMeow says:

    I didn’t blog very seriously before, because it was actually difficult to get the exact content that I wanted for my blog (personal style & travel). Let’s just say I’m the one behind the camera so my blog doesn’t center around me as I’d like it to. Instead, it seemed like an online journal that I did for fun, which got 500 – 1,000 pageviews a month without advertising. Because of issues with keeping my domain name, I had ceased blogging for about half a year now and it’s like starting over again. Now I’m planning how to go about my blog at a new angle, so thank you for this post! Selling ad space for a $1 sounds like a good point to start and grow for me.

  45. See Lo says:

    I’ve never really considered using charging ad spaces before until now. I just thought that a blog was just a blog that people write whatever is on their mind. However, being involved with a lot of non-profit organizations, I’ve realized it’s more of a business tool in order to pass along your mission or goals, depending upon the cause of course. Now that I’ll be taking over a magazine shortly, I really need to step up the game. Thanks.

  46. Casey says:

    Actually, you’ve just written another not-so-helpful back-of-the-napkin article on the topic of banner ads. Banner ads come in lots of sizes and shapes, so for which size/shape banner ad does this article apply? I figure my ad space sales using a unit of 125×125 pixels, the smallest ad I sell and slight discount the price for larger ads. So, a 250×250 banner would be, say, 10% off 4 times the price of a 125×125 ad. Also, especially now with continuing changes to Google’s algorithms that favor real content, you have many more options to make money from your blog such as guest posts, embedded links and even Google Direct Ads. Advertisers now regularly contact me to place articles or ads, etc., unsolicited and I’m far from being one of the blogger bigshots.
    - Casey

  47. Amby Felix says:

    Thank you so much for this article. I’m new to selling ad space on my blog and it’s been a bit frustrating. I don’t want to sell myself short nor do I want to come across as delusional lol. I think it’s like everything else in life, go with your instincts. I have my prices set fair and after reading this article I realized I was selling myself a little short, but it’s fine for now because as my blog grows, I will also grow as a businesswoman. Thank you again! xo

    :)

  48. Thanks for explaining.

  49. wittyOGASKY says:

    Thanks for this information, I am working to launch my blog and I think now have a clue on what to do when my blog is running with good page views per month. However, I want to ask how one can approach these companies in my country Nigeria for placing their banner on my blog…thanks

  50. NAyAN says:

    I am currently getting 12K visitors monthly, and I am being approached by some direct advertising companies to put banners on my tech blog. So, all I want to know is how much should I charge?

    Best regards
    NAyAN

  51. Austin says:

    This post is quite educative and the comments as well. I have been thinking on how to monitise my blog naijainvest.blogspot.com with 4000 monthly visitors. I taught the monthly visit was not sufficient, but after the comments on here, I’ll give it a try.

  52. Great tips for any one wanting to start selling banner ads on their web site or blog. Have you an idea as to the lowest traffic figure you could potentially start to sell ads on a site? Or would a web owner with low traffic be better trying to find a business to advertise with them that would cover immediate costs, such as hosting etc?

  53. GlamThings says:

    Super interesting!
    Could some one please advice what size of the banner blogger should have on a side bar?

    Thank you!
    Yelena
    http://www.glamthings.com/

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