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  1. #51
    SitePoint Addict Ronny's Avatar
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    IMO 50% is questionable; As a 25% cut wouldn't get any of us complaining but might be taken by a crappy ad network, 50% should really justify itself in terms of $$$.

    Without getting into it too much, you can see that the 50% Burst! is taking looks fine. They have that demographic survey thingy and their terms of use and other agreements were the longest legal documents I've ever read (and I've been to similar pages on the sites of more than 40 different ad networks). They look just so proffesional... Problem is we got accepted but most of our traffic is Israeli and they're so geographical-directed they had served about 1 paying ad out of 200, so we're now trying Casale Media, which seems great AND is taking only 30%. Now that's the way! Let's enter the CPM world :-P
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  2. #52
    SitePoint Wizard OnlineGuide's Avatar
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    What you need is a network that takes all traffic. There are a few of them. Well, the few that I know are reputable.
    The Online Guide

  3. #53
    SitePoint Zealot Venix's Avatar
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    We can also look at it this way. Let's pretend that the ad network and the websites where the same company. And Say this company operates 4000 websites. There is needed at least one person per website, some larger websites need a bigger staff to manage all the daily updates. Websites is the this companies core product and to compete against all the other websites on net these websites need to be constantly updated with content and programmers need to program new stuff all the time to make sure the technology is new and fresh. All the websites needs constant marketing as well, SEO, PPC, off line and online ads. By spending money on marketing the sites, their value increases which means the company value as a whole increases. The company makes money by selling advisement and through affiliate sales. The company has an own division (the ad network) to take care of this, Team Ads. Team Ads are responsible for selling ads and finding affiliates offers that can be run on the sites. The sales team consists of 40 sales people and 30 additional staff to take care of the payments and the ad servers as well as other paper work.

    (Note: One could probably combine the staff from similar websites and cut it down to about 1000, but still it would require heavy manpower to operate the whole network)

    Now if you were the CEO of this company, where would you invest most of your companyís income to secure future growth? Would you give 50% to Team Ads or would you invest most of it into further development and marketing of your core product and the salary to the 4000+ (1000+) people who worked with this?

    And I am not trying to put down the work done by the Ad networks, I am only trying show how unbalanced todayís web economics are. But because Team Ads and Team Websites is not the same company in reality and not owned by the same shareholders and run by the same CEO. A lot of funny things are allowed to happen. And if Team Ads claim they need more than 20% of this companyís income to operate, than Team Ads needs to seriously look at how they can lower their costs.

  4. #54
    SitePoint Guru Mook-Jon's Avatar
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    This is an exact reason why I stick with getting paid out per lead, and not clicks or cpm. The networks charge the advertiser, not me, and I sit there all pretty making over $1k a day with whatever traffic I have and not having to worry if people are clicking or if ads are showing up properly. It's the simple life I tell ya, and it's the way all web advertising should be. Advertisers are happy to get full information from people interested in their service/product, networks are happy because they act as the middleman and always get paid, and publishers are happy because they know they are getting paid a lot of money for a fair CPA. Simplicity is great.

  5. #55
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    As soon as I see a thread or a post in a business forum with the word GREED in it I laugh.

    Business is about making money and maximizing your income. When you switch out Fastclick for Burst are you being greedy? Or are you doing whats in the best interests of your business?

    If ad networks charged too much, there would be more incentive for competition at a lower rate and the networks would be forced to adapt or perish. The invisible hand almost always works.

    If they are being greedy and charging too much why don't you show them all how smart you are, start an ad network, undercut their rates and you'll be a zillionaire in no time! Or sell, track, invoice, collect, go after deadbeats, etc on your own and laugh all the way to the bank.

    Of course if you actually do those things, you're being greedy...

  6. #56
    SitePoint Zealot Venix's Avatar
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    Quote Originally Posted by MontereyJack
    As soon as I see a thread or a post in a business forum with the word GREED in it I laugh.
    Yes you are right, the title of the discussion has the word GREED in it. But do you know what...I have a movie at home called Crouching Tiger Hidden Dragon. And this this is really odd...the movie isn't about tigers and dragons at all??? How silly is that???

  7. #57
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    Quote Originally Posted by Venix
    Yes you are right, the title of the discussion has the word GREED in it. But do you know what...I have a movie at home called Crouching Tiger Hidden Dragon. And this this is really odd...the movie isn't about tigers and dragons at all??? How silly is that???

    Hmm. So I made a post about the the title having greed in it and then followed up with a relatively insightful post about how business is essentailly about greed.

    And then you attempted to mock me by telling me that you have a movie that doesn't actually have the words in the title in it.

    Golly, you sure showed me.

  8. #58
    SitePoint Zealot Venix's Avatar
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    I guess my point is that you thought you made a really insightful post, when I thought you really didn't because if you read the whole thread you would see that you brought nothing new to the table.

    To sum things up:

    We all know business is about making money.

    The invisible hand have been pointed out all ready : and from where I am sitting it looks like it has already started working. Casale Media only takes a 30% cut and have just as good eCPM but a much better fill rate than say Burst who still takes a 50% cut.

    The core of this discussion is if ad networks who take 50% cuts are overcharging for their service and if the market over time will force them to lower their cuts. (it's not about me being able to run a ad network or not)
    Last edited by Venix; May 14, 2005 at 09:13.

  9. #59
    SitePoint Wizard OnlineGuide's Avatar
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    With burst, the survey banners that we are forced to run are more upsetting than their cut. Wish they would cut that out of the program.
    The Online Guide

  10. #60
    SitePoint Zealot Venix's Avatar
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    Survey banners...,what survey banners?


    PS: put a text link up instead and drop the banners, I have got enough filled out surveys through using just a text link

  11. #61
    SitePoint Member COTR's Avatar
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    So let me get this straight...the cut in by the top heavy verticle org. structure penalizes the person who is keeping the customer happy? That's why so many freelance as indi contractors.
    Last edited by COTR; May 13, 2005 at 23:50. Reason: mispelled words

  12. #62
    SitePoint Enthusiast guitarnoise's Avatar
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    Considering my sites generate a lot of traffic I think the 50% split is unfair for the publisher. After all, most of the time they are showing RON ads offering IM Smilies and Desktop Wallpaper. None of which are much use to my visitors.

    It's probably not a bad idea for publishers to consider hiring someone to work full time on ad sales. Taking a 100% cut of ads that are strongly targeted to your audience rather than 50% of aimless generic ads is probably worth the extra effort. And then the networks can be kept in reserve for unsold inventory.

    I don't think the networks do a bad job. But 50% for RON ads is a bit unreasonable. If they are using the same ads everywhere on the network they really didn't do any extra work for me, did they?

  13. #63
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    Quote Originally Posted by RightMedia
    If you feel that the percentage you're earning as a publisher isn't fair, talk about it with the ad networks you use. Then it's up to the network to decide whether working with you is worth giving you a better revenue share.
    As someone who also works for a network, I'm always interested in reading discussions on this subject. The success of our network is directly connected to finding the right balance that satisfies the needs of our advertisers with the needs of our publishers. We understand that publishers are not exclusive to our network, so it's in our best interest to be fair with their payouts.

    I am constantly soliciting input from our publishers to help us build a network they will choose to work with even if they are offered a higher rate on other networks. Unfortunately what it takes to secure quality advertisers has a direct relationship to what we're able to payout to publishers. But we do understand without quality publishers we wouldnt have a network, so we cannot be insensitive to their needs either.

    Rene Rapp
    SpecificMEDIA Performance
    http://leads.specificmedia.com
    affiliates@specificmedia.com

  14. #64
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    I don't see 50% as being an issue.

    If you think having an equal profit for doing nothing other than signing up once and adding a little code snippet to your site is "greedy", then technically your off the scale for greed. The only reason you call them greedy is because they make 50% from all their clients and thus their pofit as a whole is larger than yours and you think you could make more money because they can "afford" to sacrifice some of theirs?

    If your unhappy with 50% you can sell 'ad space' directly from your site @ 100% at even higher rates!! but you know you wouldn't make a penny that way.

    Try getting you own clients willing to pay per click or impressions. you might just get one client a year willing to spend £10 on you! ooo lardy dar. OR you could have thousands of different advertisers and make a lot lot more.

    Are you willing to manage, devlope software, set up a merchant account - probabily set up some form of company identity for limited liablilty /legal reasons, pay for contracts to be made or spend time to write a safe contract? could you even show statistics /allow log in for your advertisers? pay for speedy 24/h support, afford to give refunds when you mess up? follow trading standards i guess? and many other things to earn errr... a few pennys per click?

    Can they trust you? could you prove that they get /got all 1000 CPM or did you just ad 1 for every 10? do they know that your visiters will actually click on the ads and buy somthing from their own site.. or will it all be wasted on blank clicks? (targeted listings)

    Your barking up the wrong tree i think.

  15. #65
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    Forget percentages -- what actualy do you get?

    It is really not about whether a percentage is fair or not, it is about whether the amount you receive in advertising is enough to help you grow your site and enable you to add value. Is it 50% of $1 we are talking about, or is it 50% of $10,000. $5,000 monthly would help me to employ a subcontractor to build my site, 50c would pay for nothing! And regardless of whether it could have been $7,500 instead of $5,000, worthwhile amounts of money would possibly not have been possible with my resouces -- I doubt I could sell 50c worth of ads on my site, but I could certainly do with even $500 to make my site zing a little more!

  16. #66
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    Quote Originally Posted by lukus001

    If your unhappy with 50% you can sell 'ad space' directly from your site @ 100% at even higher rates!! but you know you wouldn't make a penny that way.

    Try getting you own clients willing to pay per click or impressions. you might just get one client a year willing to spend £10 on you! ooo lardy dar. OR you could have thousands of different advertisers and make a lot lot more.

    I totally disagree with you. If you have a nice quality site with high traffic, you will find advertisers on your own. Only this month it's $160 from direct sales on my own, so your statement is wrong or maybe true for a turnkey sites.

    It's all depends on your expectations and willing to stay there.

  17. #67
    SitePoint Zealot Venix's Avatar
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    Quote Originally Posted by lukus001

    Your barking up the wrong tree i think.
    Do you really think so? , to me it looks like am barking up the perfectly right tree

    And to further reply to your post.

    I am sorry to be rude but what you wrote in your post couldnít be further from the truth. Itís quite obvious (which was pointed out by N F S) that you must be running some kind of cookie cutter site or that you have no clue about this subject what so ever.

    So please let me give you some facts to chew on.

    First there was a net (the bone)

    Then came the websites (the meat)

    Then came the ad networks

    a neat but still obvious idea that offered a service to the websites and advertisers. For this service they demand a cut of the money flow between the advertisers and the websites. And even how much some of you like to twist and turn it, in the end they still just deliver a service. Take away all of todayís ad networks and all that will happen is a few ruff months. It wonít take long before somebody else steps in and takes their place. Take all the websites off line and you are left with absolutely nothing. Itís important to understand that even if the ad networks were gone that advertisers still have billions of dollars to spend on ads, and though it might not be as convenient as with the ad networks around (that is why we love the networks, and yes even me though some of you like to think I am some anti ad network dude) they still need to advertise on quality sites in their field.

    So of course there will never be a web without the ad networks in reality because basically it is such a great service that makes things a lot easier for all of us. But in the end it is just a service and that what it is, nothing more.

    I also find it strange how some of you make the business of selling your own ads sound so complicated that an expedition to Mars seems like a stroll in the park in comparison. I and many other webmasters I know sell their own ads and I plan to keep doing it a lot more in the future.

    To me this question comes down to which party get to say the final word, who sits on the final control stick which if forced to can override the other control sticks. This is what will determine where this is going. And can any of you really argue for that in five years ad networks will have in general raised their cut to 70%, or is it more likely that they will offer web publisher better deals as a result of the growing competition in this field? Do some of you really think that quality websites must fight to get into an ad network? Or will the ad networks fight over the quality websites? The answer to this question couldnít be more obviousÖ

    If we assume that that the answer to the above question is the most obvious one, since I havenít seen any arguments posted here that prove the opposite, and I admit I would be very surprised if somebody was able to. The next question would then be what cut would publisher be offered in say 5 years? In my original post I stated that I thought it would go as far as publishers getting 80% , but I see that 80% might be a bit too bold a statement in 2005. So I will join the group that pointed at the 30/70 model as this is much more realistic and some networks are doing it already with great success as far as I know, like Casale Media.

    Somebody pointed to the fact that it is not the % cut that matters but what eCPM you get with the networks. And that is absolutely true, hell I would be ok with a 20% cut from a network that could offer very high CPM ads and great fill rate. On the other hand this scenario is only partly true because this will only work until a new network comes along and manages to sell inn ads with just as high CPM but offers the publishers a 30% cut instead. I see no reason to believe that in the long run a network can sell ads to a much higher price than their competitors. So when the market finally catches up with them it will again come down to what cut they are willing to offer publishers.

    And for the gazillion time we are not discussing who is greedy or not, I put the word greed in the title to get some attention. I thought most people would be able to read past the title
    Last edited by Venix; May 15, 2005 at 09:11.

  18. #68
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    Quote Originally Posted by N_F_S
    I totally disagree with you. If you have a nice quality site with high traffic, you will find advertisers on your own. Only this month it's $160 from direct sales on my own, so your statement is wrong or maybe true for a turnkey sites.

    It's all depends on your expectations and willing to stay there.
    But you forget that a nice quality site doesn't just apear over night and doesn't come free either... Would the "large" sites even be large if they didn't get money from ad networks when they were "small"?

    Selling ad space directly from yourself, to me, is an upgrade from going with an ad network, but of course by doing things yourself you have a lot more work cut out for you and responsibility which could make it a bad move... You could have a "drought" and then your stuffed, which is why most sell as much as they can themselfs and rely on ad networks to fill in the gaps? makes sense doesnt it?

    Pull the plug on a high traffic website so they have to make money by selling ad space themselfs... how long can they afford to keep the site running or make a profit in their pocket (depending on the goals /intention of advertising on the site) ... My opinion and guess is "not for long" of course, a website that covers an area that is very popular with advertisment, and is one of THE biggest sites on the net relating to specific category they probabily will live.

    If you own a website, say you just stoped Network ad. and only accept direct adv sales... could you keep the site going? could it grow bigger? then compaire it to when you first started making money from advertisments. i.e. when you first started the site... would you be able to then?

    @Venix, take the ad networks away, most people sites won't make money... the most popular ones probabily will... Do you think an advertiser wants to go and find 1000 websites every week and contact the webmaster, decide if he or she isn't a scam, arrange the payment and have to deal with 4000 site in a month, check that they are all going well etc.. etc..? I for one don't think they would. Which, if you think about it is why ad networks are so dam popular with advertisers?

    You sell your own ads.. but do you use ad networks aswell? If you do is that becaise direct sales can't maintain your site or profits? or because you can't make enough direct sales yourself to run through the whole month before being "used up"

    Also, how can you justfy saying in your first post ad networks shouldn't be taking 50% and should actually be only taking 20%? if its not about the % but how much money you make per click for example? So when it boils down to the point it's not about the ad networks making more money or equal money than you, its about you not getting enough money at the moment.. or to make it sound more pretty for you "getting the best deal"

    I have been thinking about this for some time now, and I find it really strange that most ad and affiliate networks can take as much a 50% cut.

    I think most ad/affiliate networks need to take a closer look and revalue their position in the industry. Because when I take a closer look there is not one of my networks that can justify taking a 50% revenu share for their job.
    So its ok if they make 80,000 from you as long as your making 20,000 instead of 15,000 each? what about fair trade for the advertisers aswell?

    So basically you started this thread cnot for the fact you thought ad networks are taking too much money for doing so little? but for the fact you think you should be making more money and thus advertisers should be paying out more?

  19. #69
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    adsense taking 80% is on the lines of freakin highway robbery....cmon yahoo, msn bring some competition and force adsense to at least be 50-50...like most to all ad networks

  20. #70
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    Quote Originally Posted by Venix
    when I take a closer look there is not one of my networks that can justify taking a 50% revenu share for their job.
    Compare to a book author who only perceives 10% I rather think that at terms that what risks to happen, I hope not of course

  21. #71
    SitePoint Zealot Venix's Avatar
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    Quote Originally Posted by lukus001


    So its ok if they make 80,000 from you as long as your making 20,000 instead of 15,000 each? what about fair trade for the advertisers aswell?

    So basically you started this thread cnot for the fact you thought ad networks are taking too much money for doing so little? but for the fact you think you should be making more money and thus advertisers should be paying out more?

    I see your point, but I was more refering to that people will go, including my self, for the better deal there and then, and not care about the % cut if they are offered a truly great service/high CPM or what ever. I guess what I meant was that when everybody keeps going for the better deal over time the market will shift. And in the end it will be the ad networks who will most likely have to cut down on their own share because of the facts I mentioned earlier. From where I am standing it dosen't seem very likely that ad networks will send out emails to their publishers that from tomorrow they will lower everybodys cut by 10%.

    When I join a network, I do it to use their service. Obviosly many do not agrees with this, but my personal opinion is that charging 50% of the money flow is overpricing this service. As a result I have joined a network who charge only 30% for the same service, and the end result is that I now make more because they can offer a better deal. New networks will come along and also offer better deals so in the end the networks who swear to the 50% model will need one hell of a sales team to compete.
    Last edited by Venix; May 15, 2005 at 16:04.

  22. #72
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    but just because they offer a better cut DOESNT mean that you will be making more..thats the point. the cut is irrelevant, the final eCPM is all that matters

  23. #73
    SitePoint Zealot Venix's Avatar
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    But networks needs to sell ads at a competetive price so in the end they will have to also compete on the revenue share to publishers

  24. #74
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    Quote Originally Posted by steb
    but just because they offer a better cut DOESNT mean that you will be making more..thats the point. the cut is irrelevant, the final eCPM is all that matters
    a higher cut => higher eCPM, don't you think?


    Quote Originally Posted by lukus001
    But you forget that a nice quality site doesn't just apear over night and doesn't come free either...
    I don't make "over night sites" and actually I hate them, if I visit one and see nothing great as stuffed adsense OR Amazon ads on a white page I don't even want to surf it and close immediately

    Quote Originally Posted by lukus001
    Would the "large" sites even be large if they didn't get money from ad networks when they were "small"?
    Big ad networks prefer high traffic sites(MaxOnline example), so right now I have a new site that receives like 500-1000 uniques a month, do I have any ads from ad netwoks? No, I'd rather build the traffic first and then apply

    Quote Originally Posted by lukus001
    Pull the plug on a high traffic website so they have to make money by selling ad space themselfs... how long can they afford to keep the site running or make a profit in their pocket (depending on the goals /intention of advertising on the site) ... My opinion and guess is "not for long" of course, a website that covers an area that is very popular with advertisment, and is one of THE biggest sites on the net relating to specific category they probabily will live.
    2 years and rising

    Quote Originally Posted by lukus001
    If you own a website, say you just stoped Network ad. and only accept direct adv sales... could you keep the site going? could it grow bigger? then compaire it to when you first started making money from advertisments. i.e. when you first started the site... would you be able to then?
    Yes I could, but then I would spend more time on finding advertisers, and I don't run cheap ads for my market, if I see that I get let's say 10 cents CPM for US impressions and I know that it would cost much more(and I usually do know the price range), I stop that ad or might leave ad network.

  25. #75
    SitePoint Guru RevenuePilot's Avatar
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    Venix in your post you made one big under calculation, you only took in to consideration the fact that more ad networks are coming out to the market, but how about websites? Do you know how many new sites and I am not talking about template sites but rather quality sites are coming out everyday? Do you also know that a lot of networks including burst, tribal, etc.. donít accept even half of quality sites which apply, personally here at RevenuePilot we have seen huge increase in applications from new publishers over the past year now it is at the point there we get hundredths of new applications per day, yes half of the sites donít stand up to our standards so they get rejected but many sites are good high quality sites! At this point everyday millions of people around the globe are thinking or starting new sites, and the process is only accelerating since its so easy to start a good websites compared to an ad network which requires much more expertise and much much more capital to start and manage. So while I do understand your point personally I think in the coming years we will see the opposite as more and more qualities sites will come out the network will become more and more selective with picking out sites and deciding with who they want to work, I know for a fact that number of high quality banner networks are not accepting a lot of good sites simply because they have huge inflow of new applications!


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