Display Ads on an Ecommerce Blog: Smart Revenue Stream or a Terrible Idea?

It’s not always easy to bat a thousand in the Ecommerce business. Many sellers face big up-front investments followed by a long process of sample lead times, manufacturing, and shipping procedures. This behind-the-scenes waiting game leaves lots of site owners feeling stuck without decent cash flow until they’re completely up and running. Luckily, when it comes to generating profit online, I remembered there’s more than one way to skin a cat. But I didn’t actually want to skin them at all, they had just become my biggest potential customers! I’ll explain. 

Back in February 2021, my marketing company, Pangolia Pte. Ltd., acquired Hepper, an online retailer of modern cat furniture. Up until this point, we had specialized in building content websites and creating great resources for our audience. The Hepper acquisition marked our first venture into the Ecommerce space. It was an exciting step and served as a new chapter for the company. 

Unfortunately, it was probably also one of the worst times to get into Ecommerce. The global pandemic brought the 2021 supply chain to its knees. Here’s why:

• Port-to-port travel time for cargo ships on the Transpacific Eastbound lane (China to US) hit an all-time high of 115 days in December 2021.

• Freight costs increased to nearly triple that of pre-pandemic levels.
• Production slowdowns led to inflationary pressure throughout the supply chain with unit costs and the Producer Price Index growing at its fastest rates since records began.

Additionally, it had been at least 4 years since the former Hepper owner had ordered new products from our manufacturers. This ultimately meant that we had to wait longer than normal to get new products manufactured.

Adding Value to Our Business in Troubled Times

We realized that 2021 was probably not going to be the best year for Ecommerce. Therefore, we started looking at how we could add value to our new business so that it would be in a good position when supply chains stabilized—if they stabilized.

Our management team decided to put a lot of resources into creating engaging and helpful articles on our blog at Hepper.com. This had a two-fold benefit. First, we could help improve the lives of pets and their owners. At the same time, we could inform our audience about our products in a subtle yet effective manner.

For example, a blog post about “How to entertain your cat indoors”, provided a great place to introduce readers to one of our cat toys in the hopes of driving sales. This also boosted our long-term channel for marketing as we were attracting a lot of readers from Google and several social media platforms.

That’s when we had the thought: What if we added display ads to our Ecommerce store’s blog?

What Are Display Ads?

Display ads, sometimes called banner ads, are those that appear on a website, either in the sidebar or interspersed throughout the body of the article. Most major online resources have them, and they’re a decent revenue source for a lot of publishers. 

How Much Can You Expect to Make From Display Ads? 

It’s hard to say how much display ads can generate because it varies a lot from website to website.

The revenue generated by display ads is usually calculated in RPM (revenue per mille). This basically means how much revenue you make for every 1,000 pageviews on an article.

RPMs are impacted by a bunch of factors such as the industry, quality of your article, website layout, which month of the year, and many other things. However, in 2021, ad RPMs were usually in the range of $5 to $20 USD for pageviews coming from the US.

This extra revenue coming from display ads can then be reinvested to create even more content and continue improving the quality of existing articles.

The beauty of display ads is that they very quickly allow you to establish a diversified revenue stream. You’re not just reliant on one advertiser. With display ads, you have thousands of companies bidding to place an ad on your site. Therefore, you’re not dependent on or restricted by the whims of one client.

The benefits don’t end there. Display ads these days are very “hands-off” if you work with an ad management company such as AdThrive or Mediavine. They take care of almost everything— installing the ads, working with advertisers, etc.

The Pros & Cons of Display Advertising on an Ecommerce Blog

Display ads sound like a win-win proposition; however, conventional wisdom says that you should never put display ads on an Ecommerce site’s blog since they are bothersome and can damage your brand value.

But we thought about it further, and established the pros and cons of rolling out display ads on our blog:

Pros

• It would give us a diversified revenue source that we can reinvest into product development, building our team, and publishing more content.
• Publishing more content will attract more readers to our blog, and create an opportunity to introduce them to our products. Publishing more content will also attract more attention from media sites and bloggers. And since links are still a big factor in Google search results, this will help all our product pages rank higher on the search engine.

Cons

• It could dilute our brand value because ads can be seen as low-quality
• Loading speed will be worse (not ideal, but with our developer optimizing for loading speed, this isn’t a big concern for us)

We decided that it was definitely worth trying to add display ads to our blog. For us, the positives outweighed the negatives by far. Above all, more content means more revenue. And if the ads didn’t end up performing as expected, or if they had a negative impact on the user experience, we could simply remove them (with a 1-month notice).

So, Was It Worth It?

Yes, it was very much worth it for us to roll out display ads on the Hepper.com blog. Here’s why:

• Our revenue from display ads on Hepper.com currently generates more in profits than what we’re making from selling our cat furniture!
• The cash flow from the display ads has allowed us to reinvest heavily into writing more content, and having all this content has attracted a lot of links from other sites. Those links have helped our posts rank higher in Google. Also, the presence of our blog is expected to help our own cat products gain a bigger presence in Google.

Here’s a picture that shows the huge growth in organic traffic from Google (according to Ahrefs) that we have been able to achieve on Hepper.com over a one-year period. This growth is partly because of the display ad revenue we were able to reinvest into producing more content:

Source: Ahrefs.com

This is a big win for us, and we’re glad that we challenged the conventional wisdom that one should never put display ads on their Ecommerce site’s blog.

What’s Next?

Will we remove display ads from our blog in the future? Maybe. Right now, Hepper is still in the early stages of development, and it won’t be long before our supply chains are well-oiled and our sales start to explode. We might reach a point where the display ad revenue is pathetically small compared to our product revenue. When that happens, we might consider removing display ads.

Would we consider removing these display ads right now? No way! That would mean a lot smaller revenue, which would mean we had less money to reinvest into building better products and creating more great content.

A Related Thought: Is It Worthwhile to Launch a Blog on Your Ecommerce Store?

In most cases, I would say DEFINITELY yes.

Think about it: if you have customers who are excited about your products, then there’s a good chance that some of them have blogs, and they may even be motivated to write about the products you’re selling. The same goes for news sites—they love featuring products in wish lists and other kinds of roundup lists. Links are still one of the most important signals Google uses for ranking websites. These give you a big head start against niche blogs and other competitors who don’t have a product that people are raving about.

A blog is also a great way to educate readers about your product. For example, let’s imagine that you are in the business of selling car putty (a slimy ball that can be squeezed into the air vents of a car to clean them). Right off the bat, you have a big problem, since it’s likely that very few people know your product exists! To counter this, what if you launched posts educating readers about your product and the need for it? Here’s are some examples:

“How to Clean Car Air Vents: Step-By-Step Guide”

“X Essential Items for Cleaning Your Car”

Inside those posts, you could break down the benefits of using car putty to solve various vehicle issues and explain how your product will make their lives easier.

The Display Ad Solution: Is It For You?

Hopefully, the experiences outlined in this post have helped you narrow in on whether it’s worth it to allow display ads on your budding Ecommerce store’s site. It certainly gave us the leg up we were looking for, but it may not be a one-size-fits-all solution. Consider the other variables at play and ask yourself if a site’s content can be improved—or at least largely unaffected—by the addition of display ads, rather than overtaken by them. If you can find the sweet spot between a boost and a burden, you could be making thousands in no time.