Any publisher, big or small, reaches the point where they need to decide on how to turn their content (and audience) into money. Luckily, there are a myriad of ways to monetize a website today.
But for most publishers, the choice lies between reader revenue and website monetization with ads. However, the two models are very different and can be seen differently by the publisher's readership.
In this article, we'll compare reader revenue models and website monetization to help you decide which model is right for you.
Reader revenue, simply put is when your readers pay publishers directly. . The scope of reader revenue can be very different depending on the organization. It can be in the form of financial donations and micro-payments, benefits-based memberships, and subscriptions.
For publishers, monetizing their content with reader revenue is one of the most lucrative opportunities to scale their profits and continue to support the work of their editorial teams.
In fact, a recent study revealed that reader revenue strongly competes with display advertising for being the key revenue stream for commercial publishers (79%).
Reader revenue or subscription business model has several advantages and disadvantages for publishers.
Pros:
Cons:
There isn't a consensus about how many different revenue models there are, especially considering that these models often overlap for many publishers. However, the most popular terms that have emerged over the years in reference to reader revenue models are subscriptions, contributions, and memberships. We'll go over all of these in turn.
Publishers can implement subscription modelx in the following ways
Firstly, publishers must consider how a reader revenue model fits with readers' perceptions of their brand values. Secondly, publishers should decide how important advertising revenue is for their business.
Publishers who do not restrict access to their core content (for example, with contribution models) can leverage an advertising model alongside to have a safe and sustainable revenue stream. This can be especially useful for publishers with audiences with diverse levels of income.
However, publishers with subscription models might not be able to monetize the website using ads since subscribers may get disheartened seeing ads while also paying for a subscription (which is usually perceived as access to premium user experience).
Ultimately, publishers should think carefully about their decision's long-term sustainability and look for tech partners that can see their business model as a whole with different revenue streams. For example, quickly switching from a advertising model to a subscription model without considering the risks may negatively impact revenue in the short term and even threaten the organization's livelihood.
Website monetization using ads is how more than 99%of the publishers across the globe generate their revenue.
When it comes to website monetization, programmatic advertising is the leading digital advertising method today. According to eMarketer’s forecast, global digital ad spending has been growing over the years and will reach $585.96 bn by 2023.
Since creating content is a difficult job in itself, many publishers reach out to website monetization platforms to take care of their monetization efforts.
The benefits of this decision are crystal clear. Monetization platforms usually offer access to premium programmatic technology like header bidding, which is difficult to acquire for an average publisher.
On top of that, premium monetization platforms have dedicated AdOps (Ad Operations) teams that take care of all technical aspects of monetization from start to finish. Each is also paired with a dedicated Account Executive that offers consultations on the best ad placements, ad formats, and various optimization techniques.
There are different types of website monetization, and many tech partners focus solely on one type of online advertising. We'll focus on the 3 most popular website monetization types:
Finally, how do you decide whether reader revenue or website monetization is right for you?
Well, as technology is constantly changing, it remains important for publishers to have a tailored and secure user experience, which requires the knowledge of their audience. For example, some audiences may be reluctant to see advertising if they're paying for a subscription.
Ad-based monetization might be the best way for most publishers, with its low barrier to entry and steady revenue stream. The reader revenue model requires more nurturing and time to pay off. However, reader revenue may generate better results for your business in the long run, if you have a large and engaged audience.
Nevertheless, if you decide to go the advertising route, make sure to respect the user experience, i.e., don’t clutter your website with too many ads, use user-friendly ad formats, and ensure ads are brand-safe. Again, this is where you'd have to enlist the support of a monetization platform with all these services.
Undeniably, more revenue initiatives push publishers to look for other ways to monetize their content. Analyze your audience to see how likely they are to pay for your content. You can send out polls to your most loyal readers to ask them if they'd rather pay for the content or see ads.
It's also possible that a combined approach (reader revenue model + advertising) might be the best choice for your business.