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Jul 18, 2009

Affiliate programs versus AdSense earnings

Affiliate programs are often compared by looking at the EPC - earnings per click.

However, if you want to compare affiliate programs commissions with AdSense earnings, a more precise way is to calculate the payout you receive per 1,000 page views (CPM).

Here's how to calculate your CPM:

Let's say you earn $180 in affiliate commissions from 30 thousand (30,000) page views. $180 divided by 30 = $6. You have a CPM of $6. Not very inspiring, but not uncommon.

The AdSense stats display the effective CPM you earn.

Remember, AdSense doesn't have to replace your affiliate commissions. You can earn affiliate commissions AND AdSense commissions from the same page.

If you have a very efficient site with a high conversion rate, AdSense may not be right for you - or perhaps it would be suitable for SOME pages, but not others. Remember, the more choices you give people, the more likely you are to confuse them.

However, if you're creating a large information site, or if you have a site that does not have a brilliant conversion rate, AdSense could prove to be a very profitable addition to your site.

(Strictly speaking, CPM means COST per 1,000 impressions, but the calculation works OK whether you're spending money or earning it.)

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