Wednesday, June 07, 2006

Is Blogging for Adsense Bucks Worthwhile?

The internet is brimming with articles, ebooks and hype about using blogs in conjunction with Google’s Adsense program as a means of generating revenue. The formula for success, it seems, is simple. You blog, you place ads, you get traffic, visitors click on the ads and you get paid. The question many people have about the whole process is whether or not the end result will really be profitable considering the time and effort that is required to implement the strategy.

This question has been difficult to answer, in large part, because of the Google Terms of Service for Adsense users. Although the terms have recently been loosened somewhat, users were long prohibited from sharing personal information regarding their success levels and other key statistics that might have provided prospective for-profit bloggers from developing a clear perspective on the profit potential available.

If you are curious about whether or not you can make blogging with Adsense a legitimate moneymaker, it is worth conducting this relatively simple exercise. The results can give you an idea of whether or not it is worth your time.

First, determine how long it will take you build your blog. Consider the set up time and the time necessary to do initial promotion and to write at least ten to twenty starter posts. We can term this variable ST, for “start-up time.” For our hypothetical, we will say our ST is twelve hours.

Second, estimate how much ongoing time it will take on weekly basis to do additional promotion and to add at least two new posts. Multiply this figure by 52 (the number of weeks in a year). We will term this variable MT for “maintenance time.” For this example, we will set MT at 104 hours (2 hours per week).

Third, add ST and MT. This will give us an idea of the total time required (TT). In this case, TT is 116 total hours.

Fourth, investigate the average value of an ad click in your niche. You can use the Overture bid tool, easily found online, to get a reasonable idea of the value of each click. In order to make your projection “safe,” reduce that number by half. This yields PPC, or “pay per click.” Let’s say the bid tool says clicks related to our keyword are worth about fifty cents. Our PPC is .25.

Fifth, determine how much your time is worth. Do you feel your blogging time should generate at least $10 per hour? $20? This is a matter of personal preference. We will term the resulting variable DR for “desired rate.” We will assess the value of our time at $15 per hour for this exercise.

Sixth, assume a click-through rate of five percent. This is a low figure, as many blogs can generate click-through rates approximating 25%. Click-through rate is expressed as CTR.

Now it’s time to perform the critical calculation. One needs to determine the required number of visitors necessary to produce enough money to make process worthwhile. If we express that number as V, the equation will look something like this:

V x PPC x CTR = DR x TT

This translates to:

V x .25 x .05 = 15 x 116

V x .0125 = 1740

Thus, V must be 139,200. In order to make the process pay, you will have to drive 139,200 visitors to the blog over the course of one year. That translates to approximately 391 visitors per day, on average. Obviously, that is a very “doable” number based on the amount of time we have set aside for the process.

So, for our example, blogging for bucks with Adsense is a winner.

Perform these calculations based on your unique circumstances and you can determine the viability of earning money with a blog and Adsense.