How to Determine Display Ad Placements

by jim on December 23rd, 2009

When it comes to ads on your site, something you shouldn’t consider until you have a few hundred (or at least a thousand) visitors a day, it’s very important that you are selective and tactical when it comes to ad placements. If you put too few placements, you might be leaving money on the table. If you put too many, you’re creating a bad user experience. You want to find the sweet spot and the only way to do that is by testing.

For the purposes of this discussion, let’s assume everything is a cost per click (CPC) ad like Google Adsense.

Create a Good User Experience

Goal number one should always be to create a good user experience because without your readership, your site will languish. Without comments, the site will feel lonely. So in all of your testing, you should keep this in mind – “If I came to this site for the first time, do the ads turn me off?” If you don’t feel like you can determine the answer to that, ask your friends. Ask someone who doesn’t know you run the site and ask if they think the ads are annoying. If you aren’t sure, chances are the ads are annoying. If they’re clash, they’re annoying. If they’re everywhere, they’re annoying. If there’s a point on the site where you expect content and instead there’s an ad, it’s annoying.

Avoid these at all costs.

One of the reasons why I recommend doing this after you have a thousand visitors per day is because you need that many to have enough data to analyze. If you only have 100 visitors a day, it will take you a much longer time to get enough data to make a meaningful decision. Testing at that stage is less effective.

Test Placements & Track CTR

CTR stands for click through rate and it’s the number one metric you need to be aware of when it comes to cost per click ads on your site. Whenever you put an ad up with Google Adsense, make sure you assign it a channel so you can track the Page CTR. Then try a bunch of different placements independently and see how each of them performs. You should see CTR values all over the map with some placements performing better than others.

The left sidebar skyscraper (120×600 and 160×600) has always, on every site I’ve ever tested it one, performed the best. It beats out the right skyscraper, a right 300×250 rectangle, it beats a 468×60 banner in the header (to the right of a logo), and beats the 468×60 at the end of a post. The only one I haven’t tried is a 300×250 rectangle underneath a post title but before the post content, I think that violates rule #1 – create a good user experience (though I hear it’s good for generating revenue).

Test them independently because the first block on the page will usually have the most targeted and profitable ads. By only have one ad per page, you are keeping everything but the ad constant. If you use multiple ads, you run the risk of one block having a better targeted ad and thus getting a higher CTR because of relevancy rather than placement.

Pick Two, Test Some More

Once you’ve played around with some ad placements, put ads in the top two performing spots. After you run that for a while, review their CTRs and consider dropping one of the two. You may even consider dropping both if the CTRs are so low or the revenue is so low that you prefer to keep the real estate for more valuable content.

On, the homepage does not have a left skyscraper advertising placement because in reviewing the data, I saw the CTR was low relative to the CTR on individual posts. This is because most visitors to the homepage are regular readers (my guess) who are not interested in ads (proved low CTR). Why show ads to people who don’t want them? I took them off so that I could show more content on the homepage.

With data, specifically CTR data as a proxy for interest, you can make an informed decision on where to put or remove ads.

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6 Responses to “How to Determine Display Ad Placements”

  1. Evan Says:

    I feel like I am constantly changing ad placement because even after 18 months I have no Idea what I am doing with monetization!

  2. jim Says:

    Well, the key is to test and find the “best” spot. You also need to limit the amount of time you spend on it and waiting until you have complete data is one way to manage the constant need to tweak. You need to wait a bit after a tweak to see if it worked. 🙂

  3. Pinyo Says:

    Jim – Do you feel that CTR is a better measure than eCPM when testing for ad effectiveness? What about the factor (may be not fact) that Google may serve higher CTR ads that a low CPM and vise versa?

  4. jim Says:

    Yes definitely. You can only directly control eCPM by changing the content, so it serves up higher paying ads.

    Google will always try to maximize revenue, so they will maximize CTR x CPM. However, they calculate the CTR part of the equation network wide, not just on your site because that’s how Adwords does quality score on the other side of the ad. You should do your best to maximize CTR and that will maximize your revenue, CPM isn’t something you can control.

  5. Monevator Says:

    I have always avoided the left hand block in copy ad, because I feel it mars the experience. I’ve no doubt it pays the best though – if only because I always notice it on sites that do it!

    Regarding regular readers, I’ve set up my ads that appear between the post title and the body copy to only show after two weeks. This way regular readers don’t see the ad but searchers looking for specifics do.

    I don’t know if anyone has ever done the metrics on regular readers clicking through on adsense, but I bet it’s vanishingly small.

    Just my two cents. 🙂

  6. » How To Price Banner Display Advertising Says:

    […] can pick placements randomly or you can use a data driven CTR-based approach to selecting ad placements, but you will need to pick out a few places on your site that you would consider selling […]

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