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?

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44 Responses

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  • Patrick, January 6, 2008

    I think a lot of people have shifted their thinking lately in terms of how to go about monetizing a blog. Ads are ads, and that revenue possibility will always exist I think, but people are starting to see how a really popular blog with no ads or affiliate links at all can still be a very valuable asset. If a blog becomes popular and continues to grow and gain new readers, the possibilities are endless for opportunities in the future. For starters, the author has a “virtual resume” that they can point to as evidence of their writing skills, and can then use this as a springboard for landing an awesome job. Another idea is to write a book and then use the blog to promote it. And you can always build up a popular blog and then sell it for a song. People are realizing that there is so much more potential out there then simply sticking up the old Google Adsense…..

  • sir jorge, January 6, 2008

    traffic first model is definitely one that i favor

  • Vandelay Design, January 6, 2008

    Patrick,
    You have some very good points. I completely agree that blogs can have significant value for other things like you have mentioned. I have used this blog as a resume for a few other writing opportunities, so I know what you have said is true. Thanks for your feedback.

  • Michael Martine, January 6, 2008

    One argument against monetizing a site with advertising from the beginning with AdSense specifically is that if you have a lot of AdSense units on low traffic, underperforming sites, they will actually drag down your earnings potential from any sites that have higher traffic.

    Until a site can carry its own weight, so to speak, you will probably be better off in terms of your collective overall earnings potential if you leave off using Google AdSense on the site.

  • Karen Zara, January 6, 2008

    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.

    You say this as if this blog wasn’t already providing quality information. :-P Did you mean that your second blog will be monetised from the start? With the credibility you have, you certainly can reproduce Daniel’s example.

    Which approach did you take?

    I’ve never ever tried to monetise a blog or site from day one.

    Why did you make that decision, and would you do it the same if you had to do it all over again?

    I always choose not to monetise from the beginning because I want to avoid complaints from visitors.

    I have nothing against ads. In fact I think they are essential to keep the Internet balanced. After all, if someone spends their time creating good stuff, it’s only fair that they are rewarded for this. The problem is that most people seem to expect everything to be free and couldn’t care less about the time and effort employed on the great things we find on the web. Therefore it normally takes me a long time to start displaying ads on my sites. It’s a way to delay certain annoyances.

    It doesn’t mean that I’ll never try something different. One of these days I may create a new site complete with ads and all. I just need to overcome my fears regarding early monetisation.

  • Tay - Super Blogging, January 6, 2008

    This is an absolutely amazing post, Steven. I made the mistake of monetizing my blog much too early (right from the start, actually) and of course I didn’t make hardly anything. Now that I’m achieving traffic, it’s much easier. I think it’s best for the blogger to at least wait until they have some people reading their blog so it’ll be valuable for advertisers.

  • Video Games, January 6, 2008

    Personally I think it comes down to what suites you better. Do you want to invest time initially in getting your ads right? or do you want to do it later when you have more traffic and possibly less time.

    It’s also easier to do testing when you have more traffic and a larger audience. It’s rather complicated to test your ads when you have 10 unique visitors a day ;-)

  • Jon - FreelanceFolder, January 6, 2008

    Hey Steven, great post and really good questions. Personally when I start a new blog I’ll put advertisement right from the start, usually affiliate programs. I do this because then when I feel the blog has reached a nice level of subscribers, PR and traffic, and I go out and look for advertisers at least I know what works and what doesn’t, and I can give potential advertisers an idea of ad clicks and revenues. Advertisers are more likely to purchase a spot if you can provide them with some stats. It takes time to find out what works best, so I think it’s better to try with affiliate programs than private advertisers.

    And also, the readers and visitors get used to the ads right from the start, which may or may not be a good thing though :)

  • Marko Pyhajarvi, January 6, 2008

    I started monetizing from the start, but I was not sure if it is a good idea. Some people do not like ad-riddled blogs, so just few days ago I changed my theme and took away few ads. I would say it is ok to monetize from the start, but do it carefully. Don’t just fill your blog with ads. You have done it well in this blog.

  • David Airey, January 7, 2008

    Interesting topic, Steven.

    Whilst you’re right that every situation is different, I side with Lorelle (of Lorelle on WordPress) with this one.

    She says that you shouldn’t monetize until at least one year after starting. After this time, you’ll have a much better idea of what you want to achieve from your site / blog. You should also have made connections, built traffic, learnt about different methods, and set some specific goals to take your business forward.

    In my case, I use my blog to attract new clients, and prefer to keep it advertising free. I did experiment with paid links a while back, but got into trouble with Google and had a heavy penalty slapped on me. Thankfully Matt Cutts helped me reverse this, and I learnt a fair bit in the process (thanks to a lot of help from other bloggers).

    Your case of starting a new blog for advertising purposes will be helped greatly with your experience from the Vandelay blog. No doubt. So going back to Lorelle’s point, it could be stated that as long as you have a year’s experience marketing any site, that’s when to make the decision.

    Of course that’s not to say people can’t make a success of online advertising in a much shorter timeframe. It’s just that now, after a year hosting a blog, I know I’m much more qualified to make the right choice.

  • Wayne Liew, January 7, 2008

    I am one of the few who monetize my blog right from the start. Well, I guess it also depends on the placement of such ads and ad types. For example, readers might not like banner ads or Google Adsense ads on personal journal blogs but I do see some personal blogs earning well via sponsored posts since they can somehow relate the sponsoring site they are writing for to their lifestyle (even sometimes a story can be set up).

  • Daniel Scocco, January 7, 2008

    Good points.

    Usually I prefer to grow a blog before monetizing it. The network case is an exception.

    Even when the blog is established I think that people should prioritize growth over short term profits, so dont jam ads all over the place.

  • Joel's Seo, January 7, 2008

    Generally when it comes to building a website it’s tough to not monetize right from the start because you feel like your loosing money but the truth that I’ve seen is your better off waiting a little while. Like you said getting advertisers can be tough if your site is new at least the good ones. But the main point is if you have great content people will link to you not only that if there is no ads people feel like your in it for the right reasons and your not just making some made for adsense site. When it comes to redisigning your blog when your readdy to add ads you should make sure before hand that it’s gonna be an easy transition.

    Those are my opinions but I can’t even say I’ve always followed them. It’s hard not to get those ads in there right away.

  • Vandelay Design, January 7, 2008

    Michael,
    Thanks for bringing up the AdSense issues. I’m not very experienced with AdSense, but I’m familiar enough to know that your points are accurate.

    Karen,
    Thanks for your compliments. What I was trying to say is that the new site will not be built around a service like this blog is built around web design services. Thanks for your feedback on your experiences. I tend to feel the same way, but I think I’ll try the monetize from the start option.

    Tay,
    Thanks for sharing your experiences. That is definitely valuable to know.

    Video Games,
    Good point on the testing factor, I didn’t cover that at all.

    Jon,
    That’s true about the stats, I hadn’t thought of that. I think affiliate programs are a nice solution because you can make some money (hopefully) and visitors won’t experience a major change when the site is monetized.

    Marko,
    You’re right. Too many ads is never good.

    David,
    There are some compelling reasons to wait. At the same time I think that any number that is picked (1 year for example) is kind of arbitrary. One blogger might be able to accomplish in a few months what would take someone else a few years, and vice versa. I think this blog is fairly similar to yours in that it is primarily intended to promote a service. This blog may be leaning towards more monetization in the future, but I really have no idea how that will all play out.

    Daniel,
    I agree, short-term profits should never be a priority if you ultimately want to build a strong asset.

  • Nez, January 7, 2008

    Good arguments for both approaches. Personally, I really dislike advertising that’s in-your-face, or in a blog’s every nook-and-cranny.

    The way you do it is the “less is more” approach, which seems to me is a good compromise for either approach.

    Those 4 squares you have are minimal (each is small), but the 4 of them together form a bigger piece of screen real estate that does attract the eye.

    Furthermore, because of the relatively small number of ads you have, people are apt to at least look over your ads with a bit more attention, definitely more so than if they’re bombarded with ads every 200 pixels or something.

    Anyway, thanks for the post.

  • Vandelay Design, January 7, 2008

    Nez,
    Thanks for your feedback. I agree with you that ads lose much of their effectiveness if there are too many. I’m glad you think this approach is good.

  • David Airey, January 8, 2008

    Good point about the figure of one year. Everyone moves at different speeds. I guess I’m just one of the slower ones. ;)

    If I were to monetize my blog, I’d opt for an approach similar to yours on this site (four or six 125px images).

  • matt, January 8, 2008

    Most sites never make any money. I blog about carbon offsetting and I had ads from the beginning. I think that consistant look of the site is important, and ads are part of that look.

    Honestly, I blog because I love the topic, money would be nice but I am not sure that this blog will ever make me rich. Heck I would settle for dinner.

  • MarketingDeviant, January 8, 2008

    I think both approaches work. It is just that which approach do you favor more of.

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  • Vandelay Design, January 8, 2008

    Matt,
    You’re right, most blogs don’t make money. I think it’s also true that most bloggers don’t put in enough consistent effort to make money. In your case, it seems to me that your niche is probably very specific. That’s great since you like what you are writing about, but having a small potential audience of course does not help the income potential.

  • Jim Smoot, January 9, 2008

    I did put up some AdSense ads from the start, mainly because I already had the account and I could get a handy-dandy widget on WordPress. It’s there, but I don’t really think about it, nor have I spent any time trying to set up other streams.

    Once the traffic comes in I’ll start experimenting a bit more, but for now it’s about building a readership.

  • Vandelay Design, January 9, 2008

    Jim,
    I think that is a good approach. Building a solid base of readers will open up plenty of opportunities down the road.

  • Marc Money, January 10, 2008

    I have always done it from the start. You make a good point though as I rarely make anything in the first few months. I think I think about the ads too much too, maybe if I didn’t have them I could look more at building up the quality content.

  • Vandelay Design, January 10, 2008

    Marc,
    Thanks for your feedback. Yeah, I think that focusing on the content is essential regardless of whether you use ads right away or not.

  • Madhur Kapoor, January 10, 2008

    I prefer monetizing a website when it actually starts receiving regular visitors and good search engine traffic. If you monetize a site early , there are chances that you might turn of visitors.

  • Vandelay Design, January 10, 2008

    Madhur,
    Thanks for your feedback. That is definitely a risk that goes along with early monetization attempts.

  • Adrian @ Path to Your Destiny, January 14, 2008

    I think it’s mainly a matter of personal preference. Regardless of if you put ads in the beginning or not, you still need to work on getting traffic so 1) you have readership and 2) you make money. I chose ads at the beginning because it seems smart to me to make a dollar here and there while I work on building my readership. It won’t be anything amazing, but I’m driven to create great content and gain readership at this point… not so much bring in the revenue. Later down the line, I’ll adjust the ads as I get more viewers.

    Nice post, there was some interesting discussion here!

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  • Taylor, April 28, 2008

    I guess you’re not too interested in doing the link exchange. That’s too bad. I work really hard on my site. It already gets 300 views a day and I just made it a 3 weeks ago.

    However, I did enjoy your post. If you change your mind and decide that you want to exchange links then feel free to contact me at ttomp13@gmail.com. Title your email “link exchange.” Thanks.

  • Vandelay Design, April 28, 2008

    Hi Taylor,
    I’m not really interested in a link exchange. It’s nothing personal though. Good luck with your site.

  • Taylor, April 29, 2008

    Hey. No hard feelings for real. Thanks for taking your time to write me back.

    -Taylor

  • STRAIGHTALK, November 28, 2008

    I will agree with most of the mentioned here, and I most strongly agree with waiting at least a full Year before even trying to consider placing Adverts on New websites..

    I have been in business as a freelancer for over 4 years now and truly I have never been inclined to place any type of Adverts on my site.. because mostly those scripts ! they come in these tiny copy and paste HTML codes, but when placed on a website the dramatic speed decrease on loading performance always makes me take them down.. I hate to see a website which by far is so slow due to Adverts that I will click away.. and I’m sure if lil old Me feel this way how many Millions feel the same.. But eventually I will place some soon since My audience is increasing by the day..

    STRAIGHTALK
    Norman Flecha

  • Dan, July 9, 2011

    It can sound strange but I didn’t know that a blog can be monetized from the first day. I believed that the blog has to have some traffic first. Dan-Romania