Andrew Chen: Revenue: The Internet Wants to Be Free, but You Need to Get Paid

Revenue The Internet Wants to Be Free, but You Need to Get Paid Hi. I’m Andrew. My life in advertising: Revenue Science publisher clients Direct ecommerce subscription virtual goods Indirect ads lead generation affiliate / CPA Direct ecommerce subscription virtual goods Transact = $$$ Transactions as funnels Users enter Browse Add to cart Buy ARPU = average revenue per user ecommerce ARPU • new users • % browse • % add to cart • % who buy • average order size virtual items ARPU • new users • % register • % buy currency • purchases/month • average order size • churn % • month2 revenue subscription ARPU • new users • % register • % subscribe • subscription fee • (1-churn %) * subscription fee • … Funnel profitability dashboard Source % browse % cart add % buy Avg order ARPU SEO Adwords A 20% 40% 50% 40% 20% 20% $50 $25 $1.00 $0.80 Adwords B 40% 40% 20% $50 $1.60 3 steps to maximize ARPU • Funnel profitability by traffic source • Revisit rate % • Average order size Indirect ads lead generation affiliate / CPA Impressions CPM Clicks CPC Leads CPL Affiliate % of order ad impressions RPM • CPM leads RPM • % conv * CPL * 1000 clicks RPM • CTR * PPC * 1000 affiliate RPM • % conv * order size* 1000 Inventory revenue dashboard Section Home Profile Forum Message Search Impressions 200,000 1,000,000 2,000,000 500,000 500,000 RPM $1.00 $0.25 $0.25 $0.50 $10.00 3 steps to maximize RPM • Top level audience growth • Advertiser conversions • RPMs by section and type Direct ecommerce subscription virtual goods Indirect ads lead generation affiliate / CPA Questions? voodoo [at] gmail.com http://andrewchenblog.com @andrew_chen