Many website owners make passive income by allowing outside parties to advertise on their website for a fee. There are two types of inbound (direct) advertising that websites make use of, namely, Pay Per Click (PPC) advertising and the sale of advertising space. Affiliate marketing is a form of outbound advertising, this is advertising that does not directly market a product but rather encourages visitors to view the product on your site.
How Advertising Works
Selling advertising space has been a practice used by newspapers and magazines for a very long time. This means that the merchant offers advertisers a certain amount of page space to advertise their product. Advertisers will be charged based on the size of their advertisement, the page position (for example, a banner at the top of the page is usually more expensive than a block near the bottom of the page). Advertisers may also pay more depending on which page they advertise—landing page advertisements will usually be more expensive than others. Providing advertising directly requires that the site owner is responsible for the administration and billing. This form of advertising can be expensive, depending on how popular the site is.
What is PPC Advertising?
Pay-per-click (PPC) advertising is much more popular than selling advertising directly to the client. This is because PPC advertising requires little input from the website owner. The downside of PPC advertising is that payment is usually very low (a few cents per click) and the site owner is only paid when someone clicks on the link to the advertiser’s site—though, sites that generate a lot of traffic can earn a good income from this type of advertising. The most popular PPC advertising is Google Ads because it is very easy to set up and once this is done, payment is automatic.
For the advertiser, PPC advertising is relatively inexpensive and you only pay for traffic directed to your site by users when they click on a link in the advertisement. Major PPC advertisers, like Google Ads and Facebook, use big data to direct your advertising to specific internet users. You can refine your target demographic by age, gender, and geographical region.
Furthermore, big data is used to track users’ web activity and this is used to target individual users based on their interests as determined by how they use the internet. So if a user is searching for hotels or travel information on the internet, advertisers who are marketing travel products will be directed to that user. This means that your advertisement will be displayed on a user’s Facebook newsfeed if they search for topics that relate to your product (in the case of Facebook advertising). Likewise, Google Ads will do the same when the user visits sites that display Google Ads.