Mixing paid advertising with affiliates

Good idea? Bad?
What are your opinions?

Obviously if you assign a spot to paid advertising, it removes it from a potential affiliate sponsor position. So you have to be sure to calculate that the steady rate you'd get from the paid advertising would exceed what potential that spot held for affiliate sponsorship.

Further, say you have existing affiliates. Will paid spots cause their production to fall, drawing clicks and surfers away from the affiliate ones? And, again and if so, will the amount you charge for the paid spot offset the money potentially lost by not sending those clicks through affiliate linking codes instead?

How have some of you addressed this issue? Have you ever had both paid and affiliate listings on the same page and, if so, do you feel it's been beneficial?

Is the stable income from "money in the bank" on a purchased paid spot enough to override the fact that you can't exceed existing income on that position anymore, unless and until you start charging more for advertising?

Well from our point of view as a company we have and continue to run both types of ad in conjunction with each other where possible.

As you have mentioned though it is a delicate game of balancing the numbers whilst you may be able to make $200 in one hit by selling a paid spot, the revenues generated by that spot had it been an affiliate link also need to be taken into consideration.

This is actually one of the reasons why we keep stats reports for all of our sites, webmaster and surfer orientated, this gives us a good 'base' on which to evaluate whether a spot should be sold or should be affiliate at any given time during the month / year.

Good question too :)

Regards,

Lee

Well a thoughtful question. And one with no single absolute answer.

Selling banner ads, monitoring them and following up with the customer can be a lot more time consuming then just operating an affiliate store or ad. Time is scarce. So I always have to figure that value of scarcity into my ad prices.

Sometimes it is not worth it.

Think of your websites as a large marble bathtub. As you add sites and traffic, your bathtub fills with water. As the water increases, the growing surface area allows for more pages and therefore places to run ads - either paid banners or affiliate program ads.

Steve