People start websites and blogs for numerous reasons — some of which are financially based. With so many options for generating revenue from a website, publishers may wonder which advertising campaigns are most profitable and which ones to avoid.There are benefits and disadvantages to every advertising model.
1.CPM Advertising
CPM advertising is one of the most common types of performance marketing – especially for websites that have established traffic patterns. CPM advertising stands for cost per thousand, meaning advertisers pay website owners a predetermined fee for every 1,000 ad views, regardless of how well a particular ad performs.
CPM advertising is preferred by advertisers, as well as Web publishers, because of the security in knowing how much ad revenue will be spent and received.
However, the downside to CPM is that advertisers may overpay for a poorly performing ad, and similarly, publishers may be inadequately compensated for an especially relevant ad. CPM fees are usually negotiated according to the nature of the ad, as well as the website that will host it. Most CPM ad campaigns are under contract for a specific period of time and mediated by a CPM advertising brokerage.
2.CPC
CPC advertising refers to cost per click, meaning publishers receive ad revenue each time a web visitor clicks on a particular ad. CPC is especially popular with blogs and advertisers just starting out, although CPC can be found on veteran websites as well.
One of the most popular CPC platforms is the Google Adwords platform, which uses tracking cookies and contextual information within each website to determine which ads to display to visitors.
CPC is also known as PPC, or pay per click, among web publishers and advertisers. Many web publishers prefer CPC because of its ease of use and the unlimited potential for ad revenue. However, CPC can also be fickle in nature.
Ad revenue per ad click may vary by season and the keywords used to generate the ads. CPC is a less reliable revenue model for publishers who need more financial stability.
3.CPA
CPA stands for cost per action. In other words, advertisers pay a fee only after a website visitor views an ad, clicks on it and completes a specified action, such as making a purchase.
Usually, the advertiser will then pay the publisher a percentage of the sale, which is generally much more than would have been paid for the web visitor’s click under a CPC marketing platform.
CPA is beneficial to advertisers, because it reduces click fraud and ensures the advertiser only pays for truly profitable conversions. Similarly, many publishers prefer CPA, because commissions can rise significantly, especially when the advertiser’s products are recommended within blog posts or an email subscriber list.
On the other hand, the wrong CPA campaign could prove useless if website visitors are not compelled to make purchases.
It is important to note, however, that many CPA programs have cooking tracking policies that guarantee publishers a right to commissions on return visits for a predetermined period of time, such as 30 or 60 days.
4.CPL
CPL, or cost per lead, is an advertising model that pays the host of the advertisement each time a website visitor completes a lead form. A lead is often an inquiry requesting more information via mail, phone call or email.
CPL campaigns usually pay a predetermined amount of money for each lead, and that payout is typically much higher than the price of a CPC click-through. CPL is beneficial to advertisers, because advertisers never pay for intangible results.
CPL campaigns are especially popular among advertisers that provide client consultations, such as lawyers, lenders and financial advisors.
Advertisers are paying only for traffic interested in a specific product or service, and although it may not mean immediate income, future conversions should provide a return on the CPL investment.
Those hosting the advertisements like the CPL advertising model because advertisers must pay regardless of whether a lead converts into a sale.
Considerations
The performance of a particular type of ad campaign will vary from website. What works for one publisher or advertiser may not be profitable for another. That is why testing and tweaking are important to ensuring your website is monetized according to its maximum potential.
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source:http://trafficneed.blogspot.com/2012/06/135786650616008.html