Making Money With Communities—Part 2, Ways To Make Money
Yesterday I talked about the problems facing communities when it comes to making money. Today we’ll talk about specific ways that you can turn the loyal following that communities naturally attract into opportunities.
As I mentioned in Part 1, CPM (banner ads, etc.) and CPC (Adsense, YPN) are not always the best fit for communities. While I do use them I always put them in low priority places and use them as filler or remnant inventory. We don’t want to leave any money on the table, right? That said, there are better ways to use the precious screen real estate.
Lets look at a few:
- Direct Ad Sales
- Text Ads & Text Links
- Member Support, Donations & Micro Sponsorships
- Affiliate Marketing
1. Direct Ad Sales
Direct Ad Sales may be the hardest of all ad types to get. You really need solid traffic numbers and a great niche topic, but mostly you’ll need to be a bulldog. The hardest part about getting direct ad sales is getting finding the person who’s handling ad buys for a given company. Lets say you run a sports site and you want Nike to buy an ad. You’ll have the daunting job of sending email after email and making call after call only to get bounced around for quite a while. Once you do get through you’ve still got to sell them on the idea, which is become easier with the shift of many companies spending More online. Before you make that first overture towards contacting someone do your homework. Are they running ads on other sites? Are they running them through a network like Tribal Fusion or do they do them in house? Did you put together a fact sheet about why someone would want to advertise on your site, including stats and demographics? If not, don’t bother. This is where the money is, but if you aren’t willing to put some work into it then this method isn’t for you. It’s not a magic bullet, it’s not passive income, but it’s where the real money is.
Beyond the direct ad sales are sponsorships. These can range from sponsoring a single page on your site to co-branding your site with another companies message. This is something you can even start a lot earlier and need less traffic as advertisers aren’t really paying for performance here, they are paying for branding. Continuing with the sports example you could get a local or regional sporting goods store (or chain) to sponsor your “Buy, Sell & Trade” section. Obviously site wide sponsorships would be easier to manage, but you might actually make less that way. You could charge multiple sponsors full price for their respective sections, but if you let one sponsor buy out your site you’ll probably give them a discount. It becomes a trade off of time vs. money and only you can make that choice. Always be ready with options. Be flexible to what your sponsors need and you’ll be ahead of the game from the word go.
3. Text Ads & Text Links
Once your site is established and you’re showing up in search engines you’ll probably be approached by people wanting to buy text ads or text links on your site or in your content. This is a touchy subject and I know some people don’t like it, but it does make money. Good money. More than Adsense or YPN money. It comes down to your personal preference and if you decide to explore these you could make a decent amount of money.
4. Member Support, Donations & Micro Sponsorships
Members can be an excellent source of support, even financial support. Any community will naturally build up a loyal following, after all people are investing time at your community forming relationships with the site and other members. That’s powerful stuff, something even big companies are trying to replicate to varying degrees of success. Members often want to show their support and you can give them ways of doing just that. Ways that don’t cost the members much but add up over time. You can setup special “member groups” that cost money to belong to. Anything from $1 a month and up. The price depends on the site and you can always have multiple levels of support. The main thing that’s worked for me here is to give “extras” to support members but not remove functionality from existing members. For example, supporters get extra mail box space, custom icons/badges, custom titles etc. Little things, but fun stuff and it doesn’t stop non-supporters from using the site properly. Obviously this could evolve into paid “members only” areas, but I’m not ready to get into that.
5. Affiliate Marketing
Affiliate marketing can be lots of work. You have to find a product or service that matches your community, but it can really be worth it. Communities have something affiliate marketers spend a lot of work on – building their list. The list being a mailing list of people to send offers to. You want to make sure you respect your members, but affiliate marketing can be a nice earner. Affiliate marketing is not about throwing up a banner for product x. Forget that, get it out of your head right now. I’ve already mentioned that banners just don’t work as well as they use to, but they are especially useless for affiliate marketing. If you find a product that ads value to your community and you find a way to work it into the site, content or newsletter then you’ll do much better. One product that did well for my writing communities was subscriptions to Writers Digest. Find something that suits your community. Don’t try to sell iPods on your cooking community, it just won’t do that well.
These are just samples of ways that have worked well for me in the past. Not all of them work on every site and that’s the real answer to making money on any project – trial and error. Don’t be afraid to try things, some of them won’t work and that’s okay. You’ll learn more from failures than you will from success. The other thing I didn’t really mention was that most, if not all opportunities come when your site is built up and has traffic. If you are trying to monetize your new community I’m glad to see that you’re thinking ahead but don’t expect to start making money until you’ve put in the hours and work building up the site.
Another tip for making sure you make the most you can, and this is true of any kind of site, don’t publish your ad rates. It may sound contrary to what you’ve been told and you may not like negotiating but when you post your rates you are stuck with them. You owe it to yourself and your business to get the most you can out of every ad placement. Not all advertisers are willing to spend the same amount of money and getting people on the phone or via email is half the work. If you publish your rates you’ve given them the chance to bail out before you even talk to them. It’s always better to sell for less to fill your inventory than to hold out for someone to pay full price, you’re just wasting inventory that way and leaving money on the table.
Making money from your community is a topic I’ll be hitting on often. In the mean time, feel free to drop me a note or ask questions. Good luck making money!