This post was most recently updated on October 7th, 2019
Many website owners and managers believe that creating a specific strategy for their remnant inventory is essentially giving up on their direct sales. This is not the case. In an optimal business model, both exist as a ying and a yang. Direct sales sell the highest value spots of your website’s ad inventory and remnant ad inventory is sold to ad networks that deal with large clients that aren’t willing to pay high CPM’s and are more interested in a large volume of eyeballs. Both tiers are very important in maximizing the revenue of your website.
This common two-tier strategy is called price differentiation. Instead of charging one price and risking selling everything at a low price or charging one high price and not selling the entire inventory, a website can charge a high price and a lower price to take advantage of two different target audiences. This simple theory allows your company to have the best of both worlds. You can charge a premium price to advertiser’s that value your premium advertising inventory high enough to pay premium CPM’s and you can sell the remaining to ad networks who manage clients that wouldn’t pay premium CPMs anyways.
It is important to have a clear cut strategy for each advertising tier. Your sales team must have compelling reasons why the premium inventory is much more valuable than the remnant inventory. It is important that there is a clear divide between the two so that remnant ad inventory does not cannibalize the premium inventory. The following strategies would help define that divide between the two tiers:
In a perfect world, websites could sell every impression directly to advertisers. However, in the real world remnant inventory will be left whether you like it or not. Your remnant inventory can make a whole lot more than a fraction of your premium inventory. Remnant inventories can be quite lucrative and sometimes drive up direct sales because of competitive performance.
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