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3.16  Web 2.0 Monetization Models

The advertising model has come along; we underestimated how big that would be.

Bill Gates, MIX06

Many Web 1.0 businesses discovered that popularity (“eyeballs”) was not the same as financial success. Web 2.0 companies are paying more attention to monetizing their traffic. Starting an Internet business is cheaper than ever, and the cost of failure is lower. Anyone can start earning modest amounts of money almost immediately, using the monetization models described in Fig. 3.5.

Fig. 3.5 | Web 2.0 monetization models.

Web 2.0 monetization models

affiliate networkA business (such as Commission Junction and LinkShare) that connects web publishers with cost-per-action affiliate programs. See affiliate program.

affiliate program—A deal offered by a company to share a portion of the revenues earned from traffic coming from web publisher websites. Affiliates provide text and image ads to post on the publishers’ sites. If a user clicks through to the affiliate site and takes a specified action (e.g., makes a purchase, fills out a registration form, etc.) the publisher is paid a portion of the revenue or a flat fee. Companies offering affiliate programs include Amazon (the Amazon Associates program), Indeed, ClickBank, eBay and thousands more.

banner ad—Anad that consists of an image, often placed at the top of a page.

blog advertisingAdvertising specifically designed for display on blog sites. Companies include Federated Media and Blogads.

contextual advertisingAdvertising that is targeted to the content on a web page. Contextual ad programs include Google AdSense, Yahoo! Publisher Network, Vibrant Media, Kontera and Tribal Fusion.

cost-per-action (CPA)Advertising that is billed to the advertiser per user action (e.g., purchasing a product or filling out a mortgage application). Companies include Amazon and Indeed. See also performance-based advertising.

cost-per-click (CPC)Advertising that is billed by user click. The web publisher receives revenue each time a user clicks an ad on the publisher’s site, regardless of whether the user makes a subsequent purchase. Companies include Google AdSense and Yahoo! Publisher Network.

cost-per-thousand impressions (CPM)Advertising (usually banner advertising) that is billed per thousand impressions, regardless of whether the user clicks on the ad. Companies include DoubleClick, ValueClick and many more.

e-commerceSelling products and/or services directly through a website. Companies includeAmazon, Dell, and thousands more.

interstitial ad—Anad that plays between page loads. Companies include Tribal Fusion, DoubleClick, and many more.

in-text contextual advertisingAdvertising that is marked by double-underlined keywords or phrases in the content of a web page. When a reader hovers the mouse cursor over a double-underlined word or phrase, a text ad pops up. By clicking on an ad, readers are taken to the advertiser’s page. Companies providing in-text contextual advertising include Vibrant Media, Text Link Ads, Kontera and Tribal Fusion.

lead generationLeads are generated when a visitor fills out an inquiry form so that a salesperson can follow through and potentially convert the lead to a sale. Lead generation is a subset of cost-per-action advertising. See cost-per-action (CPA).

paid blog post—A blog post (often a product review) that an advertiser pays a blogger to write. Some argue the ethics of this practice, and bloggers are encouraged to disclose that they are being paid for the posts. Companies that match bloggers and advertisers include PayPerPost, SponsoredReviews and ReviewMe.

performance-based advertisingAdvertising that pays based on user action, such as making a purchase, filling out a registration form, etc. These are also often part of affiliate programs such as Amazon and ClickBank. See cost-per-action (CPA).

premium contentContent on a website that is available for an extra fee (e.g., e-books, articles, etc.). Companies that offer premium content include The Wall Street Journal Online and Search Engine Watch.

RSS ad—Anad included in RSS feeds. Companies include Feedster, Feedburner and Yahoo! Search Marketing.

tagging for profit—Asite that buys inbound links or tags from other sites to help increase traffic, and thus increase potential advertising revenue. High-traffic sites can sell tags or links to other websites for a profit. (Caution: Search engines may lower the ranking of sites with paid links.) An example is

virtual worlds monetizationSelling products, premium services, virtual land and more in an online virtual world website. Virtual worlds include Second Life, IMVU, Habbo, Gaia Online and There.

Web 2.0 monetization is heavily reliant on advertising. UsingGoogle’s AdSense contextual advertising program is one of the fastest and most popular ways of monetizing a new Internet business. For more information see Deitel’s Google AdSense and Website Monetization Resource Centers at

Update :: January 22, 2020