SaaS vs. Advertising based business models
savagethoughts.com
savagethoughts.com
1. SuperAwesome makes $0.50 CPM from that one ad unit(probably a small rectangle). I'm sure they have multiple ad units on each page, so their actual CPM is probably closer to $3-$4, maybe more.
2. The post does not take into account traffic quality or market size whatsoever. Maybe there are a million people interested in reading SuperAwesome content but only 40,000 people interested in your SaaS.
3. Most importantly, it's probably a lot easier for SuperAwesome to get their traffic, because they are a large content site and get traffic for free. If you're selling a service, unless you have a very popular blog or excellent PR, you(and your competitors) will probably need to buy most of the traffic you get.
I hate to tear apart someone's blog post, but this one is just plain wrong. I would much prefer post based on real data and not a slew of assumptions.
EDIT: I'm going to guess SuperAwesome is dafont.com, here's their BSA page: http://buysellads.com/buy/detail/8441
It was easy to find because on many sites on BSA have 7 million impressions and 0.50 CPM. This is a terrible example- font/graphic sites are notorious for having low quality, hard to target traffic from all over the world and many pageviews per unique visitor as they look at different fonts. That's the reason they're selling impressions for a low CPM, it is not representative of most content sites or blogs whatsoever.
Thanks for your feedback. The purpose of the post is not to say that one way is any better than the other. I was thinking about the differences between the two types of companies and trying to come up with a way to describe these differences.
You're right on that in general it's easier for a content site to get traffic then for a product site. But as you point out, a product can pay for traffic. Some would see the very fact that they can pay for traffic is a major advantage. Just my two cents here.
That said, your assumptions of my assumptions are also off. The 7 million impressions was the total number of impressions across different ads. That means that the site gets less that 7 million pageviews total. For easy comparison, I left this as is.