Selling advertising space is a great way of making money from your blog. If your blog gets good traffic, I guarantee there is an advertiser out there willing to pay you to post their ads on your blog. But how much should you charge for advertising? Too much and you’ll scare away the advertisers. Too little and the advertisers will wonder why you’re giving away your valuable real estate so cheaply. This post will help you get the right amount from your advertising space.

How Much to Charge for Advertising Space

How much should I charge for advertising on my blog is one of the most common questions from people looking to monetize their blogs. I follow the formula devised by Yaro Starak at Entrepreneurs-Journey.

This formula is only a guide and does not apply equally to every niche or situation as I’ll explain below.

Cost per ad per month = daily unique visitors ÷ 10

So if you get 1,000 visitors per day, you can charge $100 per ad per month. This gives a CPM value of about $3.33. CPM stands for cost per mille, which is a fancy way of saying the cost per one thousand impressions or page views – mille is the Latin word for one thousand (as in millennium).

CPM is calculated using the formula:

CPM = (ad cost per month ÷ monthly page views) × 1,000

Okay, this isn’t high school and I’m not your math teacher, but CPM is a term you’re likely to come across when you start selling ad space. It’s also a standard term used by bloggers across the globe so is useful when comparing your ad prices with other blogs. Don’t get too hung up on CPM values, but do bear them in mind when setting your prices.

Other Factors That Affect How Much You Can Charge for Advertising

There are also many other factors to take into consideration when setting a price for your ad space, such as:

  • How much traffic your blog gets. If you’re using the formula then obviously the more traffic you get the more you can charge for advertising. But if your blog is pulling in some serious numbers and hitting some significant milestones (100,000, 250,000, one million page views per month), you could start attracting some big league advertisers – advertisers who are seeking brand awareness over click numbers.
  • How much trust your readers have in you. If you are a trusted expert in your niche, your readers will also trust your judgement on the ads you post on your blog. At the same time, advertisers will pay a premium to have their ads on a trusted site.
  • How responsive your readers are. Most internet users suffer from banner blindness. We have just got so accustomed to ignoring ads these days. To break through the banner blindness, you need well-targeted ads. Find the right advertiser for your readers and your readers will respond.
  • The location of the advert. If you take a look at the AdSense heat map, you can see that not all locations are equal. You could charge twice as much for an advert in the left sidebar compared to an advert in the header above the navigation bar. You can also charge more for adverts above the fold (the portion of the webpage that is visible without scrolling) compared to below the fold.
  • The niche your blog is in. Some niches are made for selling advertising space. Others will struggle. If you blog in the latter type of niche, you’re going to have to work extra hard to sell ad space. Look at your most popular blog posts and approach advertisers who sell products and services in these areas.
  • The profit the advertiser makes from your ads. If the advertiser is making $5,000 a month from your $100 ad, they are getting a seriously good deal and you have room to bump up your prices.
  • The value of leads generated from the ad. A person looking to buy a car is worth several thousand dollars to a car salesman. They are more likely to spend big to reach that person. Conversely, someone looking to buy a $10 book is worth a few bucks to the author. The author needs to make a lot of sales to make the cost of the ad worthwhile.

Add Value for Both Advertiser and Reader

What it all boils down to is adding value for both your advertisers and readers. If you choose your advertisers well, and target the ads to your readers, your readers will engage with your ads and keep the advertiser happy.

You can charge as much as you like for your ad space, so long as you deliver value to the advertiser. They will keep paying you as long as they are making a profit from your ads.

In order to add value for your readers, you need to identify your typical reader and ask yourself why they are there and what they want out of your blog. Then think about advertisers who offer products and services in line with your readers’ needs. Try approaching potential advertisers, both on and offline, to advertise on your blog. The worst that can happen is they say no. The best that can happen is you start earning a nice income from selling your ad space.

You can summarize all the advice above in this simple statement:

Your advertising space is worth as much as someone is willing to pay for it, and you won’t know how much that is until you try.

Use Trial and Error to Get Your Ad Prices Right

When you first start selling advertising space, a little trial and error will be needed to get your pricing strategy right. If you’re not selling many ads, try lowering the price a little or offering a discount for an extended contract such as six months for the price of five. If your ad space is selling out straight away, try increasing your prices. It is much easier to test your pricing like this if you have a stream of advertisers approaching you. If not, you need to approach multiple vendors at different price points until you get a hit. Over time, with a little trial and error, you’ll find the sweet spot for each of your ad spaces. I’d recommend keeping a spreadsheet for your ad spaces so you can track which pricing strategies are working and which aren’t.

Final Advertising Tips

  • Start with the formula (cost per add per month = daily visitors ÷ 10) then test the water by approaching potential advertisers.
  • Create an Advertise With Us page which describes the ad space you have available and your pricing. You’ll also need to post your traffic stats. Add a note saying you have something to suit all budgets and to contact you to discuss.
  • If you don’t yet have any paid ads, fill your advertising space with affiliate banners and / or AdSense ads. Save a few spaces for Your Advert Here? banners that link to your Advertise With Us page.
  • Take a look at some of the popular sites in your niche and see how much they charge for advertising and how much traffic they get to justify the price. If they post income statements you can see what actual income they make from their paid ads versus what they theoretically charge for advertising.
  • Don’t undersell your ad space. You’ll be surprised how much advertisers are willing to spend.
  • If your traffic is so low that by using the formula it turns out you can only charge $10 per add, don’t. Nothing puts of potential advertisers more than rock bottom prices. What value do you hope to deliver for $10 per month? Instead, fill you ad space with affiliate ads and concentrate on getting more traffic. If you think your low traffic is of a high enough quality to justify higher prices, go ahead and try.
I hope this post has given you the knowledge and confidence you need to start selling ad space on your blog. If you have any questions please feel free to ask via the contact page. For those of you who are already selling ad space, let us know what CPM values you have most success with.

About The Author

David Borrowdale is the founder and editor of Blog Cogs, a blog about making a living from blogging. Learn more about him here.

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14 Responses

  1. David @ Thinking Thrifty

    Thanks so much for sharing this, I have never heard of that formula before! I’m still currently trying to build traffic and using affiliates so this is handy advice for me to know further down the line!

    • David Borrowdale

      Thanks, David. Yes, it’s a great little formula and you don’t even need a calculator to use it 😉

  2. Ima

    I have recently starting looking to get advertisers on my blog, but I had zero idea as to where to start from.
    I would definitely keep this in mind (great formula by the way 🙂 )

    Thank you!

  3. Vaishnavi

    I am still building traffic and just beginning to monetize. This is the right time for me to learn about ads, so I do it right. Thank you for this valuable post!

    • David Borrowdale

      Thanks, Vaishnavi. Good luck monetizing your site. It’s a fantastic feeling when your hard work starts paying off.

  4. Amanda

    Oh wow, thank you for this article!! It was super helpful and informative, David!! I’ve been blogging for a while now for fun and just started looking into monetization and advertising but had no idea where to start or what all the lingo meant – I definitely feel much more up to speed now! ^^

  5. kara

    This post is really helpful. I’ve been looking for a good breakdown of charges for a while. Thank you!!

  6. Jessica

    What platforms do you recommend for selling blog advertising? Now that I know what to charge, Momma wants to get paid (lol).

    • David Borrowdale

      And why shouldn’t you! BuySellAds is a good option. They do all the work of finding advertisers and handling the payments for you but take a commission. OIOpublisher is another good option. This is a plugin ($47 one-off payment) where you keep 100% of the sales. With this option, you sell ads directly from your site but the plugin handles the payment process, tracking, and reporting.

  7. Jena Proctor

    This is very informative and practical. Excellent information for those looking to monetize their blogs.