Revenue: The Internet Wants to Be Free, but You Need to Get Paid (Andrew Chen, Startonomics SF 2008)

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Revenue The Internet Wants to Be Free, but You Need to Get Paid
Hi. I’m Andrew. My life in advertising:
Revenue Science publisher clients
Direct ecommerce subscription virtual goods brands Indirect ads lead generation affiliate / CPA
Direct ecommerce subscription virtual goods brands
Transact = $$$
Transactions as funnels Users enter Browse Add to cart Buy
ARPU = average revenue per user
- ecommerce ARPU
- new users
- % browse
- % add to cart
- % who buy
- average order size
- virtual items ARPU
- new users
- % register
- % buy currency
- purchases/month
- average order size
- churn %
- month2 revenue
- subscription ARPU
- new users
- % register
- % subscribe
- month1 revenue
- (1-churn %) * month2 revenue
- …
3 steps to max ARPU
- Identify user funnels
- Increase repeat visits
- Raise average order size
Indirect ads lead generation affiliate / CPA
Ad impressions Clicks Leads Affiliate
- ad impressions RPM
- CPM
- clicks RPM
- CTR * PPC * 1000
- leads RPM
- % conv * CPL * 1000
- affiliate RPM
- % conv * order size* 1000
Inventory model Impressions RPM Home 200,000 $1.00 Profile 1,000,000 $0.25 Forum 2,000,000 $0.25 Message 500,000 $0.50 Search 500,000 $10.00
4 steps to max revenues
- Grow audiences
- Higher CTR and conv %
- Advertisers
- Optimize
Direct ecommerce subscription virtual goods brands Indirect ads lead generation affiliate / CPA
Questions? voodoo [at] gmail.com http://andrewchenblog.com @andrew_chen