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Advertising Network - Publisher's Guide for New Webmasters

Is it going to be your first time in placing online ads at your website?  If it is, wait!  Before you place an ad code, there are many things that you should know about the advertising network.  So let's go over some important points to check when you sign up for a publisher's program.

Who is Running the Advertising Network?

At least, you want to know if a legitimate entity is running the advertising network.  You want to make sure that the website clearly shows the name of the organization with its mailing address and phone number.  That sounds silly.  But there are a few advertising network websites where they don't reveal their corporate name or address.

Secondly, you want to know in which country they are operating.  The fact is that many advertising networks are run by American companies.  But there are some exceptions including, for example, AdToll and Blue Advertise.  That's important to know because if they are located in the same country as you, they might withhold some of your income for tax purposes.  As for an American publisher using an American advertising network, his or her coporate entity may be required to have a tax identification number.  Some American advertising network companies even require each foreign publisher to obtain a tax identification number.

Revenue Shareing

Don't be fooled by CPC and CPM rates that they promise.  What they say may not be exactly what you get.  Many advertising networks take some share of your earnings in the name of revenue sharing.  Some of them state their revenue share ratio right at front.  Others may not reveal it until you actually sign up and see its terms and conditions page.

What are CPC and CPM?

What are CPC and CPM, by the way?  CPC is the acronym for cost per click.  It is the dollar amount you will get paid for every click that a visitor makes.  That means you won't get paid if nobody clicks on the banner.  In such case, CPM (cost per mille), which stands for cost per thousand impressions is better.  So if the CPM is set to $5, you will make $5 for every 1,000 impressions that your website makes.  But, in reality, you won't get such a high CPM so easily. It's often lower than $1.  If traffic is very lower, your advertising network company may give you a CPM as low as $0.08.  If the CPM is that low, you will make a better living with CPC-based banners.  So whether CPC or CPM-based banners are better depends on the traffic of your website.

There is one more term we often hear, which is CTR.  It stands for click through rate.  That's just the rate at which clicks are made.  Suppose that your website delivered 5,000 impressions for a particular period of time and that there were 100 clicks, then the click through rate is 0.02.  It shows how effective the banner placement is in terms of clicks.

Low traffic => Go for CPC-based banners and take chances
Hight traffic => Go for CPM-based banners and earn a stable flow of revenue

What Payment Options Do They Have?

Depending on your relative location to the ad network company and what payment options they offer, your earnings can depreciate substantially.  Some American ad companies only pay by check.  If you live in the U.S., that won't cause trouble.  But if you live overseas and accept a foreign check, then your bank is likely to get a big bite of your revenue when you cash the check and deposit in your account.  Some banks charge as much as $30 to 40 for every check you bring in.  That means you could end up paying if the denominated value on the check is smaller than the transaction cost.  So if you are located overseas, you probably want to make sure that PayPal is an optional payment method.

How about wire?  Hmm...  Some ad companies offer this payment method.  The Bank wire transfer is expedient in most cases, at least as long as two banks have a reciprocal account with each other.  A commerical bank charges either you or the sender as much as $20 for each wire tranfer event.  And an ad company is likely to shift this cost to you.  If your earning is large like $5,000 or more, a wire tranfer might still be better than the PayPal transfer, though, because PayPal will charge you at least $2.4% of the transaction amount + US$0.30 upon receipt.  Not to mention, there is also an exchange rate risk with PayPal as they have their own exchage rates.

Web Browsers and Operating System

Do we have to worry if ad codes are compatible or incompatible with certain operating systems or web browsers?  Unfortunately, we do.  We have found an incompatibility issue under Mac OS for Clicksor's ad codes, for example.  In regard to Canep Media's ad codes, we have found an incompatibility issue for a particular ad group and a web browser.  Another source of incompatibility is where to place an ad code.  If you are going to use online ads with WordPress, take extra caution.  If you embed an code in footer.php, for instance, that could cause trouble for some adverting networks.  Using the same code twice or more on the same webpage can also cause trouble for some advertising networks because that's just one way of their preventing publishers from placing more than one copy.

Whenever we report an incompatibility issue to an advertising network, they were in denial.  But, in the end, they always admit that there's a problem.

Using Ad Codes

If you are new to online advertising, you should know that embedding an ad code in each webpage won't be a good idea.  Especially, if you have thousands of web pages, it won't be easy to switch from one advertising network to another.  So what you can do is use of Server Side Includes (SSI).  If you insert an SSI code in a webpage, you can easily switch advertising networks by rewritting the content of the file that the SSI code points to.  For example, the WordPress file below contains several SSI codes which point to particular text files including sidebar_ads.text and sidebar_ads_2.text.  If order to switch from one advertising network to another, I could just open those files and paste a new ad code.  This method applies to thousands of webpages located at the same subdirectory.  Or you can just change the path relative to the ad code file for each webpage.  (See 3rd and 4th screenshots.)  Rewriting ad codes in text file will instantly change advertising networks in real time.

Webpages with HTML extension doesn't support Server Side Includes.  So be careful.  For more information on how to use Server Side Includes, click here.

Pass-Through Ads

Most advertising networks don't guarantee that there's always an advertiser for your ad banner.  It's possible that there is never an advertiser because of your geographical location or the subject of the website.  But you probably want to use your available space without interruption.  In fact, most online advertising companies allow their publishers to display ads from other networks while they can't find advertisers for your banners.  We call these ads from other networks pass-through ads.

Displaying pass-through ads is easy.  All you have to do is to just paste an ad code from another network.  For example, AdBrite's ad manager has a tab labeled 'Pricing Options.'  You have access to this tab for each ad banner you define.  If you scroll down a little bit, you will find a text area above which it says "Paste the HTML snippet from your other network..."  So you just paste an ad code inside the text area and press the Save Changes button.  (See the 2nd screenshot.)  The content of your ad code won't change by defining a pass-through ad.  It's all done inside advertising network's system.  So there is no need for you to rewrite the ad code file.

The Number of Impressions is Low...

Let's say that you have a 160 x 600 banner at a sidebar.  Let's also assume that your website is visited by 1,000 people every day, according to a web statistic analyzer.  But your advertising network only records 600 impressions daily.  What's going on? 

A possible reason is that some of your visitors leave before the ad code is fully loaded.  It's true that some ad companies have slow servers.  Depending on the time, a server can be very busy.  It's also true that a web statistic analyzer doesn't calculate the number of daily visitors correctly.  Really?  We know that the number of daily visitors calculated by AWStats is never the same as the number calculated by Webalizer.  It seems that the number calculated by Webalizer is always higher.

What Are house (In-house) Ads?

In-house ads are ones that the ad company runs when there is no advertiser for your banner.  Depending on the advertising network, you won't earn a penny by displaying in-house ads.  Some ad companies enter banner exchange markets, purchase relatively high ad contracts and run them at low CPMs.  The difference between the contract CPM and the CPM paid to you will go to their pocket.

Just because an ad is running at your website, that doesn't mean you are making money.  It's possible that it's a free house ad.  You really have to be careful especially when you see an ad from an organization like a boyscount (girlscount) group, a government agency, an NGO like Partnership for a Drug Free America and National Center for Missing & Exploited Children.  Make sure you have Plan B and use a pass-through ad effectively when there is no advertiser for your banner.