Before I explain why, here is a little terminology I’m going to use.

CPM - This is the amount of money you earn per 1,000 impressions.

I realized that on average, each month I am earning anywhere from $6-$10 CPM from the ads on squidoo. This is insanely high compared to anywhere else you can publish on the internet that I have found. In my experience a CPM of $2-$5 is considered very good. If you take away my highest traffic lens, I’m earning over a penny a visitor that comes to my lenses. wow!

I’m not saying this to brag, but instead to illustrate why the revenue sharing system that squidoo has set up is far superior to a system like Hub Pages where the impressions are split, not the revenue.

If you were able to use your own adsense code, you would only receive earnings based pretty much on the volume of your traffic, instead of the quality of your traffic. The current tier system means that your lens has to be judged to be of high quality as well as draw traffic in order to be rewarded. I truly believe that in the long term this is a win for both the lensmasters and for squidoo. As more and more high quality content drifts to the top (can you imagine the day when getting into the top 100,000 will be like getting into the top 100?) the amount squidoo can pay each month to these lenses will only increase as well (Imagine a top tier of $80 instead of $8 ).

I’m willing to listen to arguments as to why we should be able to use our own adsense code, but you are going to have to justify three things if you change the current adsense sharing system that squidoo uses:

1) Does your system make $8-$10 CPM?

2) How do you prevent click fraud if users are allowed to input their own accounts?

3) That’s it. Just two things I decided.

So? Is Squidoo’s adsense sharing the best way? or is there another way?

The New Squidoo Ad Setup

The old Google Adsense Ads remain on the page. A new 300 pixel ad has been added in the upper right hand corner, a tower ad to the right sidebar, and a banner ad at the footer of every page.

These ads appear to be part of a CPM (Cost Per Impression) network where Squidoo (and therefore lensmasters) get paid based on how many times the ads are seen, not clicked on.

In Seth’s year end letter he mentioned that they get 6 million unique visitors a month and about 12 million visits. That a ton of impressions with three ads a page…

Is there a precedent for these ads?

The ads don’t really bother me but I wanted to see if they were over the top so I started checking out some other news sites. Surprisingly, the ad placement is very consistent with other major media sites on the web, from the big blogs all the way up to CNN.com .

Is everyone screaming about how they are the end of the world?

Of Course.

Are the new ads worth it?

Well, lets do some quick math here.. 12 million visitors at 2 pageviews a piece with 3 impressions per page is 72 million ads served in a month. If Squidoo get’s paid $0.50 CPM (which is pretty cheap) that brings in $36,000 in extra revenue. After Charity and Squidoo’s cut that leaves an additional $17,100 every month for Lensmasters.

To give you an idea of how much this is, that is enough to raise the top adsense payout tier to $10 per lens and the second tier to over $2.00 per lens.

Potentially doubling the Captain’s adsense payout? Definitely worth a look….

-The Captain