Once you’ve set the price for the various ads and ad packages on your site, it’s time to actually get paid. Your website monetization strategy will heavily depend no just on the ads and ad packages you create, but also on when you get paid.
There are multiple different ways to sell your ads, which we’ve seen over the course of our 20+ years supporting publishers and networks with their ads, as well as other methods employed by larger networks like Google or Facebook ads.
There are three main periods in which you can bill your advertisers for their ads, with pros and cons for each – before, during and after. Let’s review each option.
When billing your advertisers before their ads go up, you retain control. They have already paid you, now it’s up for you to deliver. We built the AVS Express dashboard to support this option – advertisers to pay to add a campaign to their dashboard, and get “credit” in the form of days, impressions, or clicks, which they can use at will.
You don’t need to be concerned with advertisers paying you, which can be an all-too-common occurrence. In an ideal world, this would always be the way we get paid, right?
It can require additional trust for advertisers to pay upfront, especially if they are new to working with you. This may make your sales process more difficult.
Larger advertisers may have existing payment policies in place like net 30, and you may be forced to accomodate their requirements since they may represent a significant source of income.
You may encounter issues with delivering what was promised. It is quite possible for you to sell more inventory than you can deliver, since there is no direct correlation between what you’ve promised and what the site can actually deliver (especially accounting for future trends like a sudden drop in traffic)
Another common option for selling ads is billing clients after you deliver.
It provides a low risk option for the client – they are only paying for what they already got.
You’ll never have direct inventory issues – you’ll only be billing clients for advertising products they already receive (You may still struggle at times to actual fulfill their order, but you shouldn’t encounter an issue where they paid for something they didn’t receive)
Collecting on unpaid invoices can be the bane a business’ existence. Once an advertiser has received what they wanted, it can be hard to pin them down to actually pay for it. We’ve heard anecdotes of publishers who are owed tens of thousands of dollars for ads they delivered which they have no expectation of ever recouping.
In a similar vein, advertisers can sometimes get disgruntled when their campaigns don’t perform, even if you delivered exactly what you promised and the cause was outside of their control. This might cause them to deliberately decide to not pay you, as unethical as that might be (here’s a reminder to have a good contract in place with all your advertisers!)
Collecting payment during the campaign provides a hybrid model that can get the best of both worlds. This is the method we are all used to from Facebook and Google ads – you accumulate a certain amount of debt, pay it off, and then continue running your ads.
You can let advertisers begin advertising with little risk to either of you, reducing their barrier to entry. This allows them to experiment with working with you (which might waste your time, but will definitely bring in more customers).
Your cashflow is spread evenly throughout the duration of the campaign, instead of getting larger lump sums at the beginning or the end.
You might still end up with unpaid debts, these will just be smaller amounts.
The technicalities of implementing this system are the most complex. If you try to automate it, you’ll need a way to automatically freeze campaigns that max out on the budgets, and have reminders for customers to pay their invoices and update expired credit cards. A more low-tech version of this method might see you manually invoicing your clients at monthly intervals – this achieves the same effect but increases your work as far as accounting and bookkeeping are concerned.
As you can see, the way you structure your ad sales cycle can have a big impact on your bottom line, your sales process, and the time you need to invest in your business. There is no right way to do it – different publishers (and sometimes different clients) necessitate different methods.