When Should You Monetize Your Website?
All business websites intend to create some type of value for the owner. Maybe the goal is to sell products. Or maybe it is to promote services. A common approach right now is to make money with advertisements. There are primarily two different approaches to monetizing a website or blog with ads. Some website owners choose to build traffic first and monetize later, while others choose to include monetization attempts from the start. There are pros and cons for each approach, and we’ll take a look at some of the factors that should be considered when making a decision.
Approach #1: Build Traffic Now, Monetize Later
This approach involves starting a new website or blog with little or no monetization attempts. The idea here is to build traffic as quickly as possible and monetize the site when it is consistently receiving substantial numbers of visitors. Website owners and bloggers who take this approach feel that they can build a larger audience by not including advertisements and other such monetization attempts in the early days. As a result, a few months down the road the site’s traffic will be higher than it would be if ads had been on the site all along, and more effective and productive monetization is possible.
Why I Like This Approach:
1. It is true that advertising can turn away some visitors, and a site that draws the reader’s focus to content rather than ads may be able to build an audience faster. You can keep the attention on the strength of your website or blog and hopefully benefit from this.
2. It is also true that new websites and blogs are unlikely to make any significant amounts of money on things like advertisements and affiliate programs before they have established an audience. If you aren’t going to make much money, your ads may be doing more harm (causing you to lose visitors) than good.
3. Finding advertisers can be difficult for new websites with low amounts of traffic. Potential advertisers typically will not be coming to you, and finding the advertisers may take more time than it is worth. If you are handling the advertisements yourself rather than using a third party, maintaining everything can take some time that you could be spending on other things.
Approach #2: Monetize from the Start
The second approach is to build a new website or blog and attempt to monetize it from the start. Rather than waiting for traffic to reach a specific level, advertisements and/or affiliate programs will be used from day one. Although the website may not produce a significant amount of money early on, it may be able to cover costs of operating the site and possibly even some profit. Website owners who take this approach feel that a new site or blog has some value to advertisers even if it isn’t yet drawing thousands of visitors a day.
Why I Like This Approach:
1. The website that is monetized from the start will not need a re-design when it comes time to monetize. Ads need to be placed carefully on a website for it to effectively use ads without interfering with the content. Many sites that are not monetized immediately will require a re-design, or at least some changes to the design, in order to make room for ads. If the site includes ads when it is created, it can be designed the first time to include these elements.
2. Visitors will get a consistent experience. If you don’t use any type of ads on your site, some of your visitors will become accustomed to not seeing ads, and they may not like the change when advertisements begin appearing on the site. By including ads from day one, your visitors will have a more consistent experience without that change.
3. You may be able to make some money earlier. Although a website or blog is unlikely to make a lot of money when it is just getting started, you may be able to at least cover your costs. The costs of operating a site can be pretty minimal if you are doing the work yourself. In fact, hosting may be your only expense. It’s possible to cover your expenses by using ads even on a new website. Sometimes even seeing a small amount of money coming in will be enough of an encouragement or motivation to drive you on to bigger and better things.
Which Monetization Approach is Best?
I don’t think there is an answer that is absolutely right or wrong. Each situation is different, and the pros and cons should be measured and calculated on a case-by-case basis. Each option has several reasons that make it the best choice, but each option also has some negative impacts that could cause you to go in the other direction.
Those of you who have been reading this blog for a while know that it had no advertisements for quite some time. When the blog was started there was no intention of using advertisements. At that time the goal was to use the blog to create more content that would draw search engine traffic and ultimately lead to more design work. As the months passed, the blog became sort of an entity of its own. Now the blog includes some monetization attempts. The reason for that decision is that some other forms of income will make it possible to spend more time writing and hopefully improving the blog.
In the past I would have said that I strongly favored not monetizing a website until traffic levels were high, but I’ve seen that this is not always the case. One of the biggest struggles if you choose the “monetize later” approach is knowing when is the right time to start using ads. So maybe you feel that traffic the first few months will not be enough to make any money, but do you have a specific amount of visitors or page views that you think will be enough? If you do, what is that based on?
You may think a specific number of daily visitors would give you the chance to make significant money, but what if that is wrong? If you underestimate the value of your traffic you could be missing out on money that you could have made by monetizing earlier. If you overestimate the value of your traffic you could go to the trouble of changing your website to include ads, only to find that it makes no money.
If you monetize from the start I think you will learn some things along the way that can increase your potential income down the road. What types of ads work well for your site? Are you better off managing ads yourself or using a third party? What locations on you website work well for ads? The answers to these questions will help you to make your website more valuable to you, to your advertisers, and to your visitors. Knowing the answers early on can increase your income.
One of the major factors that needs to be taken into consideration is the purpose of the website or blog. If the purpose is primarily to make money from ads and affiliate programs, why not include them from the start? Because the purpose of this blog at its start was just to drive some traffic to our design services, no ads were used. Ads could cause the loss of some potential business. Now that the blog and serving readers of the blog is becoming a priority of its own, apart from creating new design work, the goals have changed somewhat.
I’m currently in the process of setting up a second blog that will be primarily intended to provide quality information and make money with advertisements. There will most likely be no services involved like there is here at Vandelay. In this case, ads will be used from the start. I think a good example of this approach is Daily Bits, owned by Daniel Scocco. Daniel also runs Daily Blog Tips and Daily Writing Tips. From day one Daily Bits was monetized. Of course this is more realistic for Daniel because of his existing network of blogs. Advertisers know the value of his other blogs, and they are more likely to want to advertise on Daily Bits as well.
What Is Your Opinion?
I know many of you run websites or blogs. What do you think about this decision? Which approach did you take? Why did you make that decision, and would you do it the same if you had to do it all over again?