A good stream of income can be made from selling advertisements in the forms of banners, 125×125 squares, or even links. The golden question though is how to calculate how much per month you should sell them for. If you go too high, you risk not selling all of your space and deterring potential advertisers.. On the contrary, if you go too low.. Why bother selling it for a measly couple bucks a month? (and quite possibly making readers leave your blogs to click that interesting picture?)
A personal method that works for myself is that you should picture yourself as a perfectly new person that has visited your blog and has just noticed the “Advertise Here!” button on your sidebar. Then being the resourceful person you are, will consider the Google Pagerank, Alexa Traffic Ranking, Monthly Uniques and possibly Technorati’s Authority Ranking. You could then say, “I will pay X amount for this space.. No more, No Less.” which will determine your monthly rate.
Another way to evaluate an appropriate advertising price for one month would to be to calculate a C.P.M. (Cost per 1000 webpage impressions). The only problem with this is when you start to say things like: “Only a .50CPM Rate!” or “This space only costs you 50 cents per 1000 impressions!” is that other people probably offer lower rates, and the advertiser has yet to find them .
Then after setting that rate that you have valued your blog at you realize that nobody bothered to purchase one from you, you many consider lowering it to a fraction of what you “evaluated” your blog to be… Doing this to hastily though might make it seem as if you are desperate for sales. Do this sparingly and only if you really want to sell that advertising space which could in turn be used to show your “Top Posts”, “Top Commentators” etc.
Coming Up Next: Where to place your advertisements.
[tags] Advertise, Advertising, 125 ad, Calculate [/tags]