Lesson 4: Contextual Ads VS Affiliate Programs

In the previous lessons, we reviewed two main options for website monetization: contextual ads and affiliate programs. Now it’s time to compare them and decide which one is better for us.

Contextual ads

Advantages

  • easy to use
  • customizable ads

Disadvantages

  • Small commission
  • Limited layouts
  • Merchants can block your site

Affiliate programs

Advantages

  • A huge range of pricing models
  • Referral programs

Disadvantages

  • Takes more effort to set up
  • Risk not getting paid
  • Dead links

There is no doubt that you can earn a higher commission with affiliate programs than with Google AdSense. For example, you can earn $95 per sale with the Credit Assistance Network. Typically, affiliate programs pay from $10 to $150 as a commission. 

Some affiliate programs offer lifetime commissions. It will enable you to earn recurring affiliate commissions for life. For example, a visitor clicks on your referral URL and buys a product. When he returns to make one more purchase you will get the commission, even if the visitor comes directly. Every time this customer makes a purchase you earn money. 

Almost all affiliate programs have a lot of pricing models such as CPA (cost-per-action), PPL (pay-per-lead), CPV (cost-per-view), etc. Their variety let you experiment and find the most suitable model. We will learn more about it later.

However, it’s not so easy to start working with affiliate programs. At first, you have to find an appropriate program for your niche. Then it will take time to set up.

One more disadvantage is that you need to check ads from time to time. Otherwise, you will end up risking your website to be full of dead links. There are two ways of occurring dead affiliate links:

  • The affiliate program stopped selling some products and the links became expired
  • The affiliate program shut down

If you realize that a link is dead you can whether change the tracking URL or link to a different company. Choose affiliate programs and products carefully to minimize the risk.

With contextual advertising, you can forget about worries and concentrate on content for your website. Google AdSense will take care of ads. If some of them expired, they will be switched automatically.

Also, it’s a great program because AdSense can extremely well be integrated with your website. All ads are customizable so you can change their colors, position on the website and size. You can experiment to maximize your revenue. 

A little fly in the ointment is the fact that merchants are able to block your website if they aren’t satisfied with the quality of traffic. And if you have a low-quality site more and more merchants will refuse to put their ads.

Another disadvantage is a small commission. You get around 60% of the click price on the ads. The rest is Google’s commission fee.

As you can see both options have their pros and cons. If you ask me, I choose affiliate programs without hesitation. The main reason is money. With an appropriate affiliate program, I can earn more than using Google AdSense. Fewer sales can bring me more commission. 

Although it is much easier to deal with contextual advertising. Because of this, I recommend you try both of them in the early stages. 

At the end of this course, we will go back to the topic. I’m sure that by then you will realize clear benefits of affiliate programs over contextual advertising.

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