A common question asked by so many bloggers is “how much should I charge for a text link ad?” If you haven’t already done so I would suggest you read Part One of this series first.
Now I would love to give you a clear cut answer but there really isn’t one. Like any industry there are market forces such as demand and supply at play. All advertisers are different, all websites are different and the biggest variable of all is you.
My primary concern, as this is one of my greatest sources of income, is that the market has become flooded. If you’ve been a blogger for a little while you’ll have seen an explosion of ‘John Smith’s’ setting up travel blogs. You see new ones everyday; BackpackingJohn, NomadicJohn, WhereIsJohn etc. I want to stress that this isn’t a bad thing from a personal point of view, I encourage new blogs and enjoy the growth in the community. However, this is a business-centric post and if we are talking about ‘the threat of new entrants into the market’ then in travel blogging it is very high.
Supply (travel blogs) is certainly outstripping demand (advertisers) which probably explains why price is being driven down as bloggers scrabble to generate any kind of income. Even though I have seen my revenue increase I have seen a decline in how much links are worth. Whether this is a supply/demand issue, smaller advertising budgets due to the recession or bloggers not realising how much their blogs are worth, is open to debate. If you are one of the latter; stop it. You’re undervaluing yourself and your blog and we all deserve better.
Looking at my contacts list I have dealt with in the region of 50+ advertisers. That’s not to say I have gone with them all. However, this does give me a pretty good insight as to what is out there, the current trends and the answer to the question you are dying to know; how much to charge.
Let me put myself out there and use my own site as an example. My site has a Google PR3. It has approximately 40 outgoing links from the homepage (verging on too many I think, but that’s a separate issue for me) and has an Alexa Rank of 166,033. A rule of thumb that I go by for a simple text link ad is $30 per month. Price for different advertisers tends to vary slightly around this point, recently moving more towards $25 per month (remember I was talking about excess supply?).
Text link ad is such a vague term so let’s look at all the variations
Simple text link ad with anchor text only.
This is generally the most common form of text link ad and you will see these in sidebars and footers. The anchor text will generally be 1-3 words.
Simple text link ad with anchor text and accompanying text.
Similar to the above but the anchor text will be embedded within a sentence or short paragraph.
You normally see these in the shape of a travel insurance or flight widget with a search function. There will be embedded text links within the widget.
Sponsored posts – provided.
An advertiser will send you a pre-written post with link(s) within it.
Sponsored posts – produced by you.
You are required to write a specific post on a particular topic or review a particular product or service and include link(s).
Sponsored posts – An old post.
The advertiser asks you to add a link within an old post. This may require you to slightly amendment a sentence so that the anchor text fits.
Here are factors that can affect the value of a text link ad and the price you should charge
Above the fold.
This is a really ambiguous term. This normally means as high up on the page as possible. Anything above half way is considered acceptable from my experience. Text links above the fold are considered to be higher value.
Pretty self explanatory where these text link ads go. These have the opposite affect and are considered less valuable.
This is generally standard practice for a text link ad to appear on every page.
This doesn’t occur very often but it’s about as valuable as a site wide text link ad.
Every page except the homepage.
Although site wide, not having an outgoing link from your homepage is beneficial to yourself. I would generally accept a lower price for these due to the benefits.
A link with surrounding text is perceived as more valuable due to SEO. You could charge slightly more for this type of ad.
The higher your PR the more you can charge for text link advertisers. Whether this is ‘right’ is open to debate and I don’t wish to go into this now. It is understood that Google does not take too much stock in a sites PR. Nevertheless it’s a benchmark that almost all advertisers use to gauge a sites suitability. As much as we may want this to change it’s just the way the market currently operates.
If you have numerous outgoing links from your homepage advertisers are less inclined to use your website. I would suggest all blogs wanting to advertise audit their homepages to ensure that they remove or ‘no follow’ any non-essential links.
Number of links.
More links means more dollar, well it should do anyway. Before quoting any prices for a widget ask to be sent the widget and the code. Not only will you be able to see the size of the widget (and the space it will take on your sidebar) but you’ll be able to see how many links are contained within it and can price accordingly. Same goes for sponsored posts. I normally agree to one link per post, two maximum. Some blogs will allow more but that’s up to you.
If an advertiser pays up front for a period over 6 months they should expect to receive a slight discount in the region of 5%-10%.
You may think it’s all about PR but your site content also plays a part. I run one of the largest Gap Year blogs out there and as such I am one of the first ports of call for Gap Year advertisers. Having the term Gap Year in my domain name helps considerably. If you run a ‘generic’ travel blog there is always going to be many sites like yours thus lowering the price. Still, this isn’t always the case. I know some ‘backpacking’ blogs that on the face of it could be deemed generic however they have large quantity of content in a specific geographical area that they attract a large number of advertisers from that area. I have a large amount of content on Australia and therefore attract advertisers from that region.
You should note that sponsored post advertisers vary so much more on price. Predominantly text links sold in posts are normally permanent links. I know some bloggers change the link to no follow or remove it completely after a year. This is something you will agree prior to the sale but most advertises want the link archived ‘for life’. Contextual links such as this tend to be ‘safer’ provided the anchor text is relevant and it blends well with the post. However, as we explored earlier there are variables. If the link is to go into an old post, this requires very little work on your behalf but that page probably has a PR and arguably worth more. Similarly, if the post is provided by the advertiser this requires very little work for yourself but it’s not as valuable despite the fact that the advertiser is able to tailor the post for their SEO requirements.
The sponsored posts that bloggers should charge the most for are ones which they have to write themselves. There are additional costs involved with these, whether this involves your time or the fact you have to hire a copywriter to do the piece for you. These costs should be past on to the advertiser. Taking all of this into consideration sponsored posts should be priced somewhere in the region of $200-$400. Not an exact science I know but I am hearing far too often that bloggers are charging a lot less than this. I don’t want to hear how you accepted a sponsored post with 5 links for $40. You are being ripped off. After this post you should know better!
One last thing on sponsored posts; is the post they provide you any good and congruent with your readership? I once was sent a travel insurance post for over 60’s. I run a Gap Year blog, I turned it down. Don’t be afraid to say no. You can damage your image with your readership for posting sponsored posts that don’t add value to your audience. Is the quick buck really worth it in the long run if you alienate your readership?
Now there are many exceptions to these guidelines and to illustrate why I’ve provided some mini ‘case studies’. Have a read and think about what you would do if you were confronted with this situation. They are real life examples and there may not be a specific right answer but I can only advise what I have done in these situations. Write your answers in the comments if you feel like sharing your thoughts. I’ll follow up with the ‘answers’ in part 3 along with advice on finding new advertisers.
Case Study 1.
An advertiser offers you a text link ad for $24 per month. They want it above the fold on the sidebar with the anchor text within a paragraph. The ad is to run for a year but the advertiser will pay every 3 months. Would you accept this offer?
Case Study 2
You are offered sponsored guest posts every week for a year. These posts will be well written and personalised for your site and contain two outgoing links to travel sites. You will be paid $40 per post. The agreement value is therefore worth $2080 for the year. Each text link ad, which is permanent, is therefore being priced at $20 each. What would you do in this situation?
Case Study 3
An advertiser approaches you asking if they can do a sponsored post. The post fits in perfectly with your blog and includes one outgoing link. More importantly the advertiser wants the post to go live within the next 24 hours. They want to know how much you charge? How would you go about pricing this up?
Case Study 4
An advertiser approaches you with the offer of a 6 month simple text link ad to be placed in your footer. They are prepared to pay $150 up front which is the equivalent to $25 per month. They are incredibly easy to deal with and very prompt with payment. However, the link is for ‘identity protection’. Would you proceed with this sale? What could you do to make it ‘safer’?
Let me know your thoughts on this post and the mini case studies and stay tuned for part 3 of this series. I’ll give my thoughts on the case studies and explore advertiser acquisition. If for whatever reason you want to contact me privately, I can be reached here.