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1 Piersa / HOW TO MONETIZE YOUR MARKETING / 1

2 Piersa / HOW TO MONETIZE YOUR MARKETING / 2 Table of Contents Principles 3 Law 4 Chapter One - Strategies 5 Pricing 24 Creating Value for Advertisers 27 Monetize Your Newsletter In Less Than An Hour 31 Final Thoughts 40 WhatCounts Services 43

3 Piersa / HOW TO MONETIZE YOUR MARKETING / 3 Revenue Strategies for Publishers Recently, Marketing Sherpa reported 85% of companies primary objectives was to drive revenue. That said, most companies struggle to generate any significant amount of money from their newsletter program. In this book, we will explore why companies fail to meet their ROI objectives and how companies can create or improve their newsletter monetization strategies as publishers. Principles of Monetization Who is a publisher? In the words of Clay Shirky: Publishing is not evolving. Publishing is going away. Because the word publishing means a cadre of professionals who are taking on the incredible difficulty and complexity and expense of making something public. That s not a job anymore. That s a button. There s a button that says publish, and when you press it, it s done. Who is a publisher? You are. If you ve got an list with more than a handful of readers, or you ve got a website with more than a handful of visitors, then you are a publisher. The question is, what are you doing as a publisher to earn revenue so that you can increase your publishing efforts? The answer is monetization, and one of the avenues of monetization is advertising. The ability for an advertisement in to lead to sales conversion is directly correlated to the engagement of the publisher s list. If your subscribers are not engaged, it doesn t matter how many people are subscribed to your list. Advertisers are increasingly seeking higher performance from their media buys, and even small to mid-sized advertisers are monitoring publishers performance, especially with ad dollars becoming more and more scarce. The key to long-term revenue is dependent upon advertisers renewing their media buys. For this to happen, both publishers and advertisers must meet their ROI objectives. The Basics: Keep the media buying process simple Focus on subscriber engagement, not list size Context is king Keep your target advertiser in mind when designing your monetization strategy

4 Piersa / HOW TO MONETIZE YOUR MARKETING / 4 Advertising Law One area seldom discussed but of vital importance to both publishers and advertisers are the laws surrounding online advertising. Online advertising is subject to the same rules as any other form of advertising, and as the publisher of others advertisements in your marketing, you will be party to and held responsible for the advertisements you publish. When it comes to online ads, the basic principles of advertising law apply: Advertising must be truthful and not misleading; Advertisers must have evidence to back up their claims (substantiation); Advertisements cannot be unfair. Disclosures that are required to prevent an ad from being misleading, to ensure that consumers receive material information about the terms of a transaction or to further public policy goals, must be clear and conspicuous. In evaluating whether disclosures are likely to be clear and conspicuous in online ads, advertisers should consider the placement of the disclosure in an ad and its proximity to the relevant claim. In reviewing their online ads, advertisers should adopt the perspective of a reasonable consumer. They should also assume that consumers don't read an entire website (or ), just as they don't read every word on a printed page. In addition, it is important for advertisers to draw attention to the disclosure. Making the disclosure available somewhere in the ad so that consumers who are looking for the information might find it doesn't meet the clear and conspicuous standard. For more information, visit the FTC s guidelines for online advertising:

5 Piersa / HOW TO MONETIZE YOUR MARKETING / 5 CHAPTER ONE Strategies

6 Piersa / HOW TO MONETIZE YOUR MARKETING / 6 Display Ads The most common method for monetizing lists is through the use of display advertisements. Ad sizes, placement, and number of display ads vary dramatically from one company to the next, but here are some industry standards: Ad Sizes: To make it easy for advertising, make sure you offer IAB standard ad sizes in your newsletter . You don t want your advertisers to have to create a specific ad size to be able to advertise in your newsletter. Source for current list of IAB standard ad sizes: We also encourage publishers to require advertisers provide alt text ad copy for those subscribers who do not turn on images. This will allow your advertisers to still gain exposure when images are disabled in the reader s inbox. One important consideration for whether to use IAB ad sizes or not is the level of technical savvy of your audience. The more technically savvy they are, the more likely they are to employ ad-blocking software for both and the web, which can automatically filter out IAB-sized graphics. Ad Placement: Most advertisers prefer to have an Above the fold placement due to the fact that 26.6% of people view their in the preview pane. For most ISP s (such as Gmail, Hotmail and Yahoo) this space is 300px X 500px. Offering a premium positioning for your advertisers will help them generate better results. Number of display Ads: The typical number of ad placements per is two. If you have too many ads in your newsletter it not only may be discouraging to subscribers, but more than two ads will often devalue the price of the placement and will require your sales team to sell more ad placements at lower rates. Above the Fold 300 x 500 Preview Pane

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8 Piersa / HOW TO MONETIZE YOUR MARKETING / 8 Dedicated Another very popular monetization strategy is the dedicated advertisement message, where the advertiser has 100% of the marketing message. Advertisers like this option because they don t have to compete with the publisher s content for exposure and therefore see higher click through rates. For publishers, it s important they offer their subscribers an option to opt out of dedicated messages versus opting out of your notifications entirely. Some publishers will demand the advertisers provide their own opt out link for their brand. If you decide to offer this option, make sure your privacy policy or opt-in process clearly states that subscribers will receive third party offers. If you decide to offer this option, be creative about how these types of messages will add value to your subscriber s experience. A great example is a campaign we worked on with AirTran Airways to generate advertising revenue from advertisers and increase flight sales. The A-Savers was sent weekly to AirTran s most frequent flyers. Enclosed were multiple highly discounted travel offers, which made the A-Savers members feel as if they were receiving exclusive deals. It was hugely successful for all parties involved: hotels were able to book more rooms, Airtran sold more flights,y generated incremental advertising revenue, and most important their A-Savers members received a valuable offer. When sending a dedicated on behalf of an advertiser, it can be tempting to simply let the advertiser create the campaign. Do not make this mistake, as it is important for the recipient to understand who is sending them the . If the creative, From address, subject line, or body copy in the does not communicate to subscribers that the is coming from a sender they expect communication from, this will lead to confusing the subscribers as to why they are receiving a random from a company they did not subscribe to previously. This mistake will simply lead to unsubscribe activity that could have otherwise been prevented if the subscriber simply knew who was really sending them the (you, their favorite business).

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10 Piersa / HOW TO MONETIZE YOUR MARKETING / 10 Advertorial Some companies will give advertisers the opportunity to write an article for their newsletter so it doesn t appear to be an advertisement to the subscriber. This can be an extremely effective option for advertisers if their content is in context with the rest of the editorial in the . However, keep the previous mentioned point in mind that subscribers expect to receive this content in the same format and creative they typically see from your business. It s also vitally important to keep in mind that advertorial content must be disclosed in a clear and conspicuous manner as an advertisement per FTC regulations.

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12 Piersa / HOW TO MONETIZE YOUR MARKETING / 12 Video Display Advertisements In the WhatCounts platform, clients can create Video Enhanced . A number of our clients are leveraging this technology to sell pre-roll video advertisements or direct video advertisements. Video display advertisements are ideal for publishers who have highly visual content, as subscribers will already be accustomed to viewing videos and other forms of rich media. Keep video ads very short, in the format of 30 second spots, so that viewers don t get bored or lose interest, unless your ad is amazingly compelling to watch. An excellent test of a video ad is to upload it to YouTube, share it with a trusted audience, and look at the metrics YouTube provides to indicate if your video has any serious problem areas where attention drops sharply. If you see even levels of engagement, the ad is ready to roll out to a larger audience via a media buy.

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14 Piersa / HOW TO MONETIZE YOUR MARKETING / 14 Text Link Ads One of the most traditional methods used by publishers are text link ads. There is a limit to the number of characters allowed and, typically, this is a very cost effective option for advertisers since their ads are seen whether images are on or off; these ads are less expensive than rich media options. Text link ads can also come in a variety of formats, depending on the newsletter s format. Here are a couple of examples: Here s pure plain text in an

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16 Piersa / HOW TO MONETIZE YOUR MARKETING / 16 Background Wrap A fairly new and growing option is a background wrap advertisement. In this approach, advertisers can purchase the space behind the main newsletter copy for their marketing message. Advertisers like this option because it s unique and eye grabbing. Also, this is a great option to utilize as more and more readers continue to use a small-screen (iphone, ipad, Android, etc.) devices to view their . The best design for small-screen devices is a single-column design that allows the reader to scroll top-to-bottom, instead of left to right. The background wrap will display on most small-screen devices, as most of those devices allow images to be rendered as a default setting. The advertiser can also take full advantage of the space available in the background that would not otherwise be available within the editorial content. One important note with background wrap messages is that they function best when readers click through on a View on the Web link to a browser, as many clients may not render it correctly or immediately. Encourage users to click through to a web version for maximum impact.

17 Piersa / HOW TO MONETIZE YOUR MARKETING / 17 Landing Page and Micro-sites In this approach, once a subscriber clicks on an advertiser s ad, they are redirected to a landing page or micro-site within your website with additional content about the advertiser s product or services. This provides advertisers an integrated way to showcase their message. You can also offer advertisers the opportunity to advertise in your newsletter and on the landing pages of the links in your newsletter.

18 Piersa / HOW TO MONETIZE YOUR MARKETING / 18 Interstitial/Gating A newer option is selling a display ad or video ad that is shown after a subscriber clicks on a link and prior to them accessing the content on the landing page of that link. Typically these are sold on a CPA basis unless the advertiser also has an ad display within the newsletter. Be careful if you choose to offer this option. Your subscribers may get irritated by having to watch an ad before reading your content. Keep an eye on click through rates and unsubscribes, as well as bounce rates on the landing page itself.

19 Piersa / HOW TO MONETIZE YOUR MARKETING / 19 Sponsorship Advertisers can sponsor newsletters for a given period of time. This approach typically works if newsletters are specific to a category that is similar to the advertisers businesses. Note that this differs from pure advertising in that it s more of a brand placement than a pure call to action.

20 Piersa / HOW TO MONETIZE YOUR MARKETING / 20 Opt-in Display Ads Companies should also test selling ads within their opt-in process as long as it doesn t distract the subscriber from the opting into your newsletters. We recommend testing this approach to see if the ad message decreases conversions, however, careful placement of the ads after the sign-up can help prevent this issue. Display ads could be positioned on the web page during the opt-in process or on the landing page after the subscriber opts in. Typically these ads would be sold similarly to website display ads. A variation of this option is Co-registration or Co-offers. Once a subscriber has opted into your newsletters, you can offer them the opportunity to participate in your advertiser s newsletters or services, usually during the same sign-up process. Here are a couple of examples. Offer-based co-registration: In-line content-based co-registration:

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22 Piersa / HOW TO MONETIZE YOUR MARKETING / 22 Transactional Messages Leveraging your Transactional messages for advertising messages can be extremely effective and profitable. Transactional s have the highest open rate (70% in some cases) so they provide your advertisers a great opportunity to engage with your customers. A great example of this is Red Box s confirmation receipt . The Walgreens ad provides value to their customers and additional revenue. Be aware that using transactional s for commercial purposes may change your mailing requirements under CAN-SPAM and other anti-spam legislation.

23 Piersa / HOW TO MONETIZE YOUR MARKETING / 23 Mobile Ads Options HTML5 allows companies to be very creative on how they provide ad placements for their advertisers. An example of this courtesy of STYLE Campaign, is Horizontal Mobile s. The horizontal mobile layout allows you to have copy that expands the standard width. This can obviously include other ad types, such as images and even video.

24 Piersa / HOW TO MONETIZE YOUR MARKETING / 24 Pricing Format Options Design your monetization strategy with an Advertiser s mentality. Most companies are bombarded with advertising opportunities, so the easier you can make it for advertisers to purchase ad space on your newsletters the more success you will have. Be sure to create a media kit that specifically outlines the value and benefits of your newsletter and audience. Media Kit considerations include: Program Overview per Campaign Value proposition for advertisers Description of all newsletters Examples of layout and content Testimonials from past advertisers or subscribers Program Reach List size Frequency Subscriber engagement metrics Audience Data Geographic Demographic Behavioral Ad Specs When ad materials are due Ad guidelines Approval process When designing your monetization strategy, consider what type of return your advertisers expect and use their metrics to determine what price is feasible. Keep in mind that most newsletter ad budgets are spent to acquire customers and are not typically valued for their branding capabilities, so advertisers determine whether or not to advertise again based on measurable results.

25 Piersa / HOW TO MONETIZE YOUR MARKETING / 25 Most advertisers will evaluate each media buying opportunity based on how many leads are generated, not converted. It will be helpful to know the average cost to acquire a customer/lead for the businesses you target as prospective advertisers. It s important for your internal sales team to understand how advertisers evaluate your advertising opportunities. If possible, we recommend dedicating a sales team to specifically sell newsletters so they can focus their efforts on the channel. There are a number of ways you can price your newsletters. We recommend choosing the option that your advertisers are most familiar with for buying media space. Knowing your advertisers media buying preferences should be factored into how you price your newsletter opportunities. Here are some options to consider: CPM (Cost per Thousand): This is probably the most common advertisement rate used by companies since this is how most website display ads are sold. Most companies use their list size as basis for determining the CPM costs. Example: List size of 100,000 subscribers/1,000 = 100 X CPM rate = cost of ad A growing trend in the industry is for advertisers to no longer pay a CPM based on list size; instead, they pay based on impressions or opens (CPMV = Cost per

26 Piersa / HOW TO MONETIZE YOUR MARKETING / 26 Thousand Views). This makes sense from an advertiser s perspective; if no one opens your newsletter then why should they care about your list size? Example: List size of 100,000 subscribers. Open rate of 10% = 10,000 views/ 1,000 = 10 X CPM rate = cost of ad Flat Fee: Single rate for list size or segment of your list. Both publishers and advertisers like this option due to how easy it is to determine the cost of the advertisement. CPC/PPC/CPA (Cost per Click/Action): This is an advertiser s favorite pricing option because they only pay for subscribers who click on their ad or take an action, usually the generation of a lead. Most publishers don t like to offer this option because it doesn t drive the highest amount of revenue for their newsletters. Publishers still see a value in providing advertisers brand exposure. That said, CPC/CPA advertising is the fastest way to begin immediately monetizing your newsletter, and advertisers are readily available from major affiliate marketing networks such as Shareasale, Commission Junction, LinkShare, and many others. These networks allow you to immediately fill your newsletter spaces until dedicated advertising deals are made, generating revenue and giving the accurate appearance of having many advertisers. Auction/Ad Networks: Companies, such as LiveIntent, will auction off ads to advertisers. Average CPM rates vary between $1-$0.50. Many advertisers will want to test your newsletter before committing to a more expensive media buy to your entire list. Offer advertisers the ability to reach a portion of your list for a discounted price. This helps set the tone for the advertisement relationship going forward. Plus, if you have good list hygiene, then you should not be concerned about how the list will perform for the advertiser.

27 Piersa / HOW TO MONETIZE YOUR MARKETING / 27 Creating Value for Advertisers Now that we have given you a number of options for monetizing your s, let s discuss factors that can affect your pricing and advertiser s interest. I always get asked, how much should we charge advertisers or what is the Market Rate for newsletter ads? This is a loaded question and I highly recommend not benchmarking your pricing based on industry averages. There are a number of factors that can influence price, including: Subscriber Engagement This is by far the most important metric when determining your price. If you have a healthy and engaged list, advertisers will be interested in advertising to them. Your ESP should be able to help you increase engagement through best practices. Industry Niche or Mass Appeal If your newsletter targets a specific audience you will be able to charge a higher ad rate and generate more interest from advertisers. Many national news media organizations struggle to charge a premium for their newsletters because their audience is too broad. In the case of national news media, using the specific data for each individual list subscription (instead of overall audience) can make it easier to sell ads. For example, the Health newsletter audience will attract a different demographic than the Business newsletter audience so utilize that information to sell advertisements based on those separate audiences. If you have the data, provide as much segmentation as is practical for higher premiums. Competition Do your advertisers have options for targeting the audience your newsletters reach? The more options advertisers have the less you will be able to charge. Providing too many advertisement options available internally will create internal competition for ad revenue that can devalue the ad price. You can eliminate this issue by identifying and selecting the advertisement placements that meet the following two criteria and put your best foot forward from the start: 1.) Easiest to sell as value proposition is plain as day 2.) High price placement so you will not have to sell many ads to reach revenue target.

28 Piersa / HOW TO MONETIZE YOUR MARKETING / 28 This can also be true for the number of media vehicles an advertiser can choose from to reach your audience ( newsletters, social sites, blogs, websites, etc). We recommend doing a competitive audit to determine what your competition is charging and how they are positioning their newsletters. Your ESP should be able to provide you with this service. Type of Advertisers National or Local What type of companies will most likely advertise on your newsletters? Are they local companies with smaller budgets and less sophisticated when it comes to buying ad space or are they national companies with media buying agencies looking to generate a specific ROI? Local companies will have fewer options available to them so you can probably dictate higher prices. National brands are able to choose from multiple options. As we mentioned before, newsletter ad budgets come from the Customer Acquisition budget not the Branding budget. Therefore your newsletter has to perform in order to have repeat advertisers. List Size I hesitate to put list size because we preach to our clients quality over quantity. That being said, advertisers still buy based on list size in some markets. Please note that an advertiser will be more likely to buy ad space if your subscribers are engaged. Consider the following examples; List size = 1M, open rate = 10% = 100,000 impressions. List size = 500,000, open rate 25% = 125,000. Subscriber Data In today s advertising environment, advertisers demand clarity on who they are reaching and when. The more Selects you can offer to an advertiser the higher price you will be able to charge. Geo-Targeting Tracking a subscriber s IP Address location allows publishers to offer advertisers dynamic geo-targeting advertising opportunities. Device Targeting Understanding the type of device your subscribers are opening their on can be valuable information for advertisers.

29 Piersa / HOW TO MONETIZE YOUR MARKETING / 29 Behavior Targeting Leveraging website analytics data allows marketers the ability to understand their subscriber s interest and preferences. Advertisers can target subscribers based on their web browser behavior. Time-of-day Targeting A number of publishers are offering advertisers the ability to serve up time sensitive offers to their subscribers through the use of real-time dynamic image serving. (Source: Personal Interest Targeting Many companies are creating progressive opt-in forms or surveys to gather more data about their subscribers personal interests. Offering this type of segmentation to advertisers can demand a higher ad rate. Social Influencer Targeting Publishers can provide advertisers the ability to target their social influencers by using the social data they are gathering from their subscribers social sharing actions. In addition, third party vendors like RapLeaf or Fliptop, provide social demographics by mapping addresses to social profiles. Newsletter Content & Layout Where you position your advertisers ads can have major implications on pricing. Give advertisers multiple options, such as above the fold, in copy, and in navigation, adjusted for how much above or below the fold the advertising

30 Piersa / HOW TO MONETIZE YOUR MARKETING / 30 placement is located. In addition, if an advertiser s ad complements the context of the newsletter they should see better click through results. Example: A health tips newsletter with an ad for 50% off TVs will most likely not perform as well as an ad for 50% off aspirin. The design of the ad should also compliment the design of the newsletter so the ad looks to be a part of the newsletter, instead of an odd addition to the newsletter. Types of Newsletters Give subscribers the option of opting into very specific newsletter categories. The more niche your subscriber base, the better. Let your subscribers opt-in to newsletters that are truly unique and offer advertisers an opportunity to target a specific subset of people. Package Options To provide maximum value and obtain the best pricing as a publisher, consider offering bundles of media to advertisers with discounts for different tiers of service. For example, bundling a list plus social media promotion should garner more interest and ad dollars than either channel separately. Obviously, this strategy needs to be adapted to fit which channels are stronger or weaker in your publishing portfolio.

31 Piersa / HOW TO MONETIZE YOUR MARKETING / 31 Monetize Your Newsletter In Less Than An Hour If you want to get your feet wet immediately in marketing monetization, here s a recipe for you to follow that will get you set up and running in less than an hour. For this example, we ll use the WhatCounts weekly newsletter, the GameChanger. First and foremost, we should decide where we will plan to run advertising. The people who are on our list are professional marketers, advertisers, and public relations professionals for the most part at small, midsize, and enterprise companies. Next, we need to decide where we ll run ads. In the top half of the newsletter, we have a navigation area and a share area, either of which we could use for advertising space.

32 Piersa / HOW TO MONETIZE YOUR MARKETING / 32 Scrolling down further, there are plenty of other spaces where ads could go, from dedicated sections to in-text promotions.

33 Piersa / HOW TO MONETIZE YOUR MARKETING / 33 Next, we need to find some advertisers to slot in. Because this is a test to see how quickly we can monetize, we re going to use affiliate marketing programs like those from Shareasale. Let s head over to that network and look for some advertisers that might be good fits for our audience.

34 Piersa / HOW TO MONETIZE YOUR MARKETING / 34 There s a marketing tools category, and in it we found a series of programs to apply for. To evaluate each of these publishers, we look at their 7 and 30 day earnings per

35 Piersa / HOW TO MONETIZE YOUR MARKETING / 35 click, or EPC. What we re looking for is a similar high number for both. For example, advertiser #1 up top has a very high 7 day EPC and a corresponding 30 day EPC. The chances of us earning decent revenues as long as we can deliver clicks are fairly high. Advertisers 2 and 3 have high 7 day EPCs but lower 30 day EPC, which may indicate that their offers aren t as good for sustained revenue. We ll pass on those for now. We click Join Program and are presented with terms and conditions. It s important to read these! Some programs prohibit marketing due to problems with past affiliates spamming.

36 Piersa / HOW TO MONETIZE YOUR MARKETING / 36 Depending on the program, you may either be accepted automatically or be sent to an affiliate manager for manual approval. We selected a variety of advertisers and joined a few programs so that we d have an ad to run immediately. Advertisers often provide copy, creatives, graphics, and other hooks for publishers to use. In this case, we ll use the BlogWorld conference as an example advertiser. In addition to the usual banners and buttons, they ve provided an entire example For the purposes of this example, however, we ll want to fill one of the ad spaces that we highlighted above, so we ll peruse through their buttons.

37 Piersa / HOW TO MONETIZE YOUR MARKETING / 37 The first button is a great candidate for our newsletter. We ll click on it and get the HTML.

38 Piersa / HOW TO MONETIZE YOUR MARKETING / 38 Copy and paste the HTML straight into our newsletter, and we re done: our newsletter is officially monetized.

39 Piersa / HOW TO MONETIZE YOUR MARKETING / 39 After this step, it s a matter of finding programs that work best and resonate most with our audience while we pursue longer-term dedicated arrangements with advertisers. The extra advantage of using this style of affiliate marketing program is that it gives you an immediate idea of how well your newsletter will perform with dedicated advertisers. If you can demonstrate that you re already making a ton of money using affiliate programs, you will be in a better position to negotiate for more income from a dedicated arrangement.

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