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Monetising your startup from the word go with advertising & affiliates

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presentation from @digijoe at Techcrunch UK Geek n Rolla on how early stage startups should approach monetisation, from an advertising and affiliate perspective.

(Skimlinks is a simplified affiliate marketing service so we've got experience helping web publishers & startups add affiliate to their revenue strategy)

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Monetising your startup from the word go with advertising & affiliates

  1. Money! Monetising your startup from the word go with advertising and affiliates
  2. Name 2.0
  3. The weblebrity formerly known as digijoe @
  4. Monetising is an oft-abused word <ul><li>Over-used/hyped </li></ul><ul><li>Often spelt wrong </li></ul><ul><li>Embarrassing to use in front of your friends </li></ul><ul><li>But it ’ s a clear definition: “how can we take this thing we already have (traffic, users) and convert it into money?” </li></ul><ul><li>A nd its back in fashion … </li></ul>
  5. Monetisation can’t work without acquisition <ul><li> Get traffic (as cheaply as possible) </li></ul><ul><li> Convert your traffic </li></ul><ul><li> Get a good price for your traffic </li></ul><ul><li>This means don’t forget </li></ul><ul><ul><li>M arketing (SEO, Email, Social media marketing) </li></ul></ul><ul><ul><li>PR/Buzz </li></ul></ul><ul><li>Zero cost acquisition makes your job easier </li></ul>Acquisition Monetisation
  6. How we startups currently monetise <ul><li>Subscription </li></ul><ul><ul><li>Fixed (magazine/newspaper) </li></ul></ul><ul><ul><li>Variable (e.g. Freemium) </li></ul></ul><ul><li>Third-party supported </li></ul><ul><ul><li>Advertising </li></ul></ul><ul><ul><li>Sponsorships </li></ul></ul><ul><ul><li>Affiliate </li></ul></ul><ul><ul><li>Paid Content (advertorial style) </li></ul></ul><ul><ul><li>Paid Placement (premium listings) </li></ul></ul><ul><ul><li>License Content </li></ul></ul>Source: Dan Zambonini http://www.boxuk.com/blog/monetizing-your-web-app-business-models <ul><li>Payments </li></ul><ul><ul><li>Pay per use </li></ul></ul><ul><ul><li>Purchases (physical/virtual) </li></ul></ul><ul><ul><li>Donations </li></ul></ul><ul><li>Long-term revenue </li></ul><ul><ul><li>Sell customer data </li></ul></ul><ul><ul><li>Exit </li></ul></ul><ul><li>Hybrid of the above </li></ul>
  7. Popularity based on top 100 web apps <ul><li>Third-party supported model is prevalent (48%) </li></ul><ul><li>Advertising is heavily relied upon (34%) </li></ul>Source: Not Techcrunch
  8. But what is the trend in advertising? Source: IAB/PricewaterhouseCoopers
  9. 5 Practical Steps to Early Stage Monetisation Glory
  10. 1. Don’t rely on advertising! <ul><li>Display advertising CPM rates lowest for years </li></ul><ul><li>Network deals expect £0.50 CPM </li></ul><ul><li>1m impressions needed to pay for your £500/month serviced office desk </li></ul><ul><li>CPC advertising often poorly targeted, low EPCs </li></ul><ul><li>Leaves money on the table </li></ul>
  11. 2. If you are going to do advertising <ul><li>Go direct – monthly tenancy with targeted sponsors </li></ul><ul><li>Look for sponsorship opportunities e.g. themed home page, sponsored sections, email </li></ul><ul><li>Choose sponsors you are genuinely passionate about </li></ul><ul><li>Create interactive promotions whereby the audience participates – contest, discounts (think what’s in it for the advertiser) </li></ul>
  12. 3. Affiliate is your friend <ul><li>Low barriers to entry, quick to get going, works with lower traffic volumes </li></ul><ul><li>Level playing field, get the same deals as larger sites </li></ul><ul><li>13% growth this year vs 9% overall online advertising </li></ul><ul><li>Text-links convert the best (top ranked linking method by affiliates) and get rid of eyesore ad units </li></ul><ul><li>Allows more creativity, and tighter, integrated approach </li></ul><ul><li>Use tools such as voucher codes, product feeds, APIs </li></ul>Source:Jupiter Research and eMarketer and eConsultancy
  13. Affiliate Example – Merchant text links
  14. Affiliate Example – Mashery Mashups
  15. 4. Social Media / UGC can convert well <ul><li>User opinions/recommendations drive the buying decision </li></ul><ul><li>So powerful that FTC is putting holds on word of mouth marketing (WOMM) </li></ul><ul><li>Affiliate links to retailers from forums/blogs can have up to 10% conversion rate </li></ul><ul><li>Twitter/IM even higher </li></ul><ul><li>Be considerate of the users </li></ul><ul><ul><li>Beware of user backlash </li></ul></ul><ul><ul><li>E thical usage / disclosure </li></ul></ul>“ A consumer survey ranked consumer content as the #1 aid to a buying decision, cited by 91% of respondents.” (JC Williams Group, 2006)
  16. Further Reading <ul><li>Copyblogger Blog Monetisation Post http://www.copyblogger.com/blog-money/ </li></ul><ul><li>Affiliate Tip Blog (Affiliate) http://blog.affiliatetip.com </li></ul><ul><li>SEOBook (Internet marketing) http://www.seobook.com </li></ul><ul><li>Online Marketing Blog (Social media) http://www.toprankblog.com </li></ul><ul><li>Follow on Twitter @mattb811, @matthewwood, @affiliatetip, @mediatrustpete, @copyblogger, @tedmurphy </li></ul>

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