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This can vary a lot, but you can make reasonable estimates.

It comes down to quantity and quality of traffic. For a given quality of traffic, you can expect a range of possible earning levels per quantity of traffic.

Quality is most affected by the following two things:

1) How many pageviews per visit do you get
2) What topic is your website about

Pageviews per visitor matters because advertisers typically want to show the same visitor an ad no more than 3 times. It is believed that conversion rate, click through rate, or whatever else you want to measure goes down substantially with higher pageviews, simply because if they weren't interested in the ad the first time they saw it, they won't be interested the 10th time. And if they were interested in it, they would have clicked on it the first time and wouldn't stay on your site into the 10th pageview anyway.

In general, having more pageviews per visitor gives you more total earnings, but not nearly as much as having more visitors.

Even though I listed it second, the topic of your website is paramount. To take two extremes, visitors to a site that appeals to decision makers for large company IT departments are a lot more valuable than visitors to a warez site.

It comes down to:

1) how hard is it to reach the market you're reaching.
2) what likelihood are visitors to your site going to convert for an advertiser
3) how much is each conversion worth, for the types of things your topic best converts for

Some advertisers are looking to do branding, not conversion. In this case, your site's demographics and reputation needs to be top notch to get the most money. Again, this is largely a factor of the topic of your website.

For me, I run a web based proxy site. It is pretty much the bottom rung of traffic before you reach what I call "the abyss". Which is to say, I can get some legitimate advertising, from some reputable companies, at a rate that makes it worth my while. But the better paying and more reputable advertisers are put off by the fact that there could be literally any content on my website, since visitors are free to browse any website they want through my service, including porn. It is also hard to monetize because it tends to get a good percentage of international traffic. And it is further harder to monetize because there is negative stigma surrounding the industry, as well as the big no-no of running ads on what can be considered framed content.

All this aside, I can tend to expect about 5-15 cent per thousand impressions for display ads (leaderboards, skyscrapers) and 60-90 cent per thousand for popunders. Those in my industry who use adsense (which only allows ads on the homepage of the proxy, which makes up roughly 10% of it's total traffic), have reported earnings in the $1-2 CPM range.

Sites that have strongly competitive and lucrative keywords can make substantially more from google, and sites with a positive category can make substantially more from CPM ads. I would not expect to make more than double or triple these figures, even for a much more desireable demographic.

posted August 28, 2007

I am also interested in knowing how to estimate this when it comes to writing a business plan for a new business idea. Are there any rules that say you can generally expect a certain revenue per page view or per user?

posted August 29, 2007