Back in September, Reddit raised 50 million dollars in series B funding at an evaluation of half a billion dollars yes $500 Million. So whats next reddit? Will the founders of reddit ever be placed in the Billion dollar elite? Or will the company be valued at that figure first before anything? Let’s just say that the company is valued at $1 Billion, what are the founders gonna be worth at that price on paper then? Money is money either way so even if its in the $100’s of millions theirs no surprise their. What kind of new opportunities are their for the mega entertainment, social networking service and news website’s future in making more money and expanding? Design, updated versions of the sites functionality, more features and more ideas to brand on. Reddit has so much more room for growth and they are not stopping either by giving back to its community. But other then raising capital what are the many ways reddit makes money on their business? Reddit gold was their first premium membership program ever built into their site and was one of their greatest ways in making money for the company, however with CEO Yishan in the mix of bettering the company for the community of its users reddit golds partners are not paying for the program and reddit is not making money on this, reddit is giving all that money back threw the community of reddit users. So their are really two ways reddit makes money:
- They run ads: Reddit captures a targeted audience for communities relating to the niche that involves selling a product or a service threw its websites. They don’t have a problem finding advertisers to, because they have the numbers to show for. And we are talking about large traffic numbers here.
- Redditgifts Market place: In the market place gift exchanges are available on its platform allowing reddit to understand which merchants are gonna be allowed in the marketplace.
A screen shot of reddits traffic figures according to its website.
With these traffic results reddit shows a lot to prime advertisers for what they are getting out of their advertising dollars. It’s a proven fact that these traffic numbers drive tremendous success and make up for their revenue stream. We would say that more than 60% of reddits sales result in advertising for the majority of their money generating empire. As a result of what these traffic figures are we believe that in adsense retro spec if reddit were ever to add adsense as another money making way to increase their revenues they would be making a fortune ontop of what they generate now and that would result in increasing sales revenues by a great deal. If reddit on average is getting 150,000,000 visitors a month and their click-through-rate was 7% of that traffic at a cost per click of lets just say 0.80 cents based on advertisers bids threw the Google Adsense program they would be generating $ 8,400,000 a month on clicks alone. In most sources backing up true traffic results for reddit, on a monthly basis reddit produces over 2,000,000,000 page views. The way google’s rates go about paying on the impressions are based on every 1,000 impressions for the price of paying the publisher $5 dollars, however since reddit is in a very high competitive niche, with so many sites like them out their the rates are considerably rated at a lower cost per every 1,000 impression. CTR, and CPC, and CPM are always weighted differently on a basis of fluctuating changes in the market for online advertising. So for 2,000,000,000 page impression’s alone at a cost of $2 dollars for every 1,000 page impressions divided by the total number of page views reddit would bring in a monthly amount of $4,000,000 additionally. Between clicks on ads and CPM, reddit would rake in $12,400,000 in Google adsense revenue alone. That’s a yearly revenue of $148,800,000 from Google adsense ladies and gentlemen. Look at this, that would boast the shares in reddits privately structured company. So can you just imagine how much closer reddit would be if they thought of going this extra mile to becoming a billion dollar empire. and all it takes is one ad, come on how annoying is one advertisement people really? One ad isn’t gonna kill user experience nor doesn’t get annoying, We could all understand if it was five ads okay but we can see the point, but this is all up in the air for now.
