How Much Are Your Site Visitors Worth?

Do you know how much each visitor to your website or BLOG is worth?

Knowing your visitor value is important because you need that figure for calculating how much you can afford to pay for a visitor. Would you pay Google 5 cents per visitor when you only make 2 cents per visitor? Many people do.

First, lets start with some simple math. Lets say you had 1000 unique visitors yesterday. Of those 1000 visitors you made $20 from your 3 advertising accounts. Every visitor to your site would be worth 2 cents.

$20 divided by 1000 visitors = $.02 per visitor.

If you paid more then 2 cents per visitor then you are operating at a loss. Even if a percentage of the traffic was free your income is limited by the amount of traffic you can buy at below 2 cents each.

Now lets look at a more complex example. Lets say you had 1000 unique visitors yesterday. Of those 1000 visitors 1% subscribed to your RSS feed and 1% subscribed to your email newsletter. Income for the day was the same $20 so the visitor value remains the same. But lets look at what happens a week later.

It is now 1 week later and you had 1050 unique visitors yesterday. 50 of your visitors came from either your email newsletter or your RSS feed. This time you made $21 from your 3 advertising accounts. This is still a 2 cent visitor value, but this time you made an extra $1 from return visitors. So the 50 visitors from your newsletter or RSS feed are worth 4 cents when you include the original 2 cent value from the day they registered.

$20 divided by 1000 visitors = $.02 per visitor.
$1 divided by 50 visitors = $.02 + $.02 previous value = $.04 per visitor.

As you can see we now have two types of visitors. The first type of visitor stopped by and left either by clicking a link or closing their browser. The second type of visitor subscribed to the RSS Feed or newsletter and came back to the site.

Growth is achieved through return visitors and by adding other forms of income that interest your visitors. <-- Read that sentence again.

Looking long term things really get advanced. We can easily end up with 10 classes of visitors with values ranging from 2 cents to thousands of dollars.

The second part about visitor value will be posted next week. Please post your questions or comments here and I will address them in the second part of this post.

Michael

One Penny Project