That’s the conclusion I’ve come to over multiple blogs, forums and other sites. Overall, I feel that about 90% of the time the real estate where Adsense would go could be better spent on something else.
Why?
Well, there are a number of reasons. First off, when someone clicks on an Adsense ad they leave your site. Buh-bye visitor, and you’ve sent them off for pennies. There is no chance that they will generate a sale making you a nice commission or that they will then later on generate more income from future back-end sales (as could be generated via an affiliate program link). Even worse, Adsense provides "relevant" links meaning you may have sent them off into the arms of a competitor unknowingly or even indirectly.
Additionally, there is no "stickiness" to Adsense. A user clicking on an Adsense ad has decided that your site has nothing more to offer them at that moment. With an affiliate recommendation you can actually involve yourself in the process by recommending a product or offering a bonus for after-sale follow-up.
Other options that tend to be a lot more profitable than Adsense include Text Link Ads, affiliate sales, mailing lists and direct ad sales. For those of you who have never sold real estate on a site before you most likely have no idea just how profitable direct ad sales can be. Companies interested in branding their product will pay very well for a banner or other ad to be placed on your site simply displaying their wares to your visitors. The larger the company you deal with the more likely they are to pony up the cash for a big ad spend without batting an eye.
You might also want to consider affiliate programs offering recurring income so that even though the visitor is leaving your site you have the chance to continue to make money from them.
Adsense also often suffers from very low CTRs on sites like forums and certain blogs. Users visit regularly and quickly learn to ignore the block of ads they see every day. Forums also are especially vulnerable to having really bad and non-relevant ads shown often. Imagine a thread where users are discussing their Harley Davidson motorcycles making comments about their "hogs" and ads are displayed for mail order pork. Ads are also sometimes painfully irrelevant. For example, a thread discussing child abuse shows ads for Catholic priests…yes, I’ve seen stranger things. Adsense is really good but doesn’t know your visitors as well as you do.
When is Adsense a good idea? I think that until you are getting anywhere from 1000-2000 unique visitors per day you are safe throwing up Adsense to see how your readership will react to it. If you run a site that seems hard to monetize or lacks clear focus but gets traffic from a recognizable demographic Adsense may also work. For example, a site offering services for college students or social networking (notoriously hard to target) might be most profitably monetized with Adsense. Even then, it still may be worth it to open up advertising sales and see if you can pull in more sales without Adsense around.
If you look at some of the really big Adsense earners they fall into the categories I mentioned, social sites (like dating services), sites targeted at teenagers or college students, sites covering a broad subject matter but aimed at a certain demographic and sadly spam or auto-generate sites.
If your site is confined to LCD monitors, Honda SUVs or Stock tips- you would most likely make much more money dropping Adsense and taking advertising into your own hands.
Agree/disagree? Let me know…
P.S. Some of you have emailed me saying, "Hey- you have adsense on your site right now! What’s up?" and that’s a totally fair question with a simple answer. I keep the adsense ads in rotation until I’ve sold those spots to private advertisers. Regular visitors to the site also notice that those ads also regularly rotate with other affiliate ads. So for now, the adsense acts as a "placeholder" so to speak.
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I totally agree.
Adsense, as I see it, can only effectively be used as a primary monetization strategy for “whatever” sites, social sites and as you said, the auto-scraper crap sites.
And if your site is getting LOTS of traffic, like for example if you have a “celebrity” site or something getting 50,000+ uniques a day, then you should experiment with some of the CPM Banner networks, which can often lead to some decent, reliable cash from impressions alone.
I had a humor site with similar traffic levels where my CPM banners earned more than 10 times what my Adsense boxes did.
The bottom line?
Adsense isn’t the ideal “hands off” income stream that everyone thinks it is.
It actually kind of sucks, quite frankly.
And - sadly - as you said, the BEST way to make lots of *easy* cash with adsense is to build thousands of auto-generated crap sites on a continual basis, so as to blast the engines with more content than they can ban.
However, that’s not a business.
And you’ll earn a fraction of what you could building real sites that promote affiliate products or sell your own product.
-Chris