Since the dawn of time, people have measured their success by comparing themselves to others. Online creators are not exempt from this phenomenon. There are countless forums and groups where publishers share their site’s earnings in order to create community, encourage, educate, inspire, and perhaps even gloat. So what’s the problem with this? For starters, it’s challenging to get the full picture based on limited information and it often proves Theodore Roosevelt’s wisdom, “Comparison is the thief of joy”.
How then will you know if you are keeping up and if the revenue your site generates is a fair value for all of your hard work and creativity?
If comparison is inevitable then the most ideal circumstance would be to compare apples to apples. The issue with website monetization is it’s impossible to compare apples to apples. It’s more like apples to grapes, or apples to pineapples, or even apples to snow shoes.
The Indicator: RPM
One of the most commonly discussed metrics in the online publishing world is RPM (Revenue Per Mille), which measures how much revenue a publisher generates for every 1,000 somethings… such as pageviews or sessions.
It’s a simple equation: RPM = revenue / (pageviews or sessions) * 1000
This should clearly illustrate the first issue. You must determine what metric is being used to calculate the RPM so you know if you’re looking at Pageview RPM or Session RPM because the answer to the equation will change drastically depending on what metrics are plugged in. Make certain you are not comparing your Pageview RPM to someone else’s Session RPM.
EXAMPLES
Site A generated $2000 in revenue in the last 30 days. Let’s look at the differences between RPM depending on the metrics used:
2000/169,000 pageviews * 1000 = $11.83
2000/147,000 sessions * 1000 = $13.60
2000/45,000 US – organic – chrome pageviews * 1000 = $44.44
That’s just the beginning though, here are a few more examples of the factors that contribute to RPM that are typically not discussed when publishers are throwing around their numbers in publisher forums and groups.
What You Must Also Consider
Content and Niche Variability
No two websites are identical, and this fact is particularly evident in the type of content they produce and the audience they cater to. The niche a website operates in plays a significant role in determining RPM. For example, a website focusing on highly specialized, technical topics may have a lower RPM compared to a lifestyle blog with a broader, more general audience. Comparing RPMs between these two sites would be akin to comparing apples and oranges, as the content and audience targeting are fundamentally different.
Audience Quality and Engagement
The quality of a website’s audience can greatly influence RPM. Websites with highly engaged, loyal visitors are more likely to generate higher RPMs. Factors such as the geographical location of the audience, their buying intent, and their interaction with ads all contribute to the RPM figure. Therefore, comparing RPMs between publishers without considering the nature of their audiences is a flawed approach that lacks the nuance essential for ensuring an effective ad strategy.
Seasonal Variations and Market Trends
The performance of a website can fluctuate throughout the year due to seasonal trends and market conditions. Retail-focused websites, for example, often experience spikes in RPM during the holiday season. Comparing RPMs at different times of the year may lead to inaccurate conclusions about a website’s overall performance
Remember This
While RPM is one indicator of a website’s financial performance, it doesn’t tell the whole story as a stand-alone number and should be used judiciously and not as the sole indicator of success. It is common for Publishers to compare RPMs in an oversimplified approach that overlooks what is being calculated and the numerous factors that contribute to a website’s revenue generation:
- Content
- Audience
- Seasonality
These three factors alone, play a significant role in determining RPM, but there are dozens more.
Our most successful publishers focus on understanding their site’s unique traffic makeup and continuously work to improve their websites based on their specific goals and target audience.
At Monumetric we thrive on data and transparency. You will always know exactly what metrics are contributing to your RPM. We will work with you to optimize your ad strategy and offer support directly tailored to you and your unique website audience.
