Remnant inventory is a term used primarily by sales & marketing managers at websites which monetize their web traffic by selling ad space directly to advertisers.
When the volume of ads purchased by all advertisers is less than the available ad inventory (eg not all ad units have been purchased), then the unsold inventory must be monetized using another strategy.
In an ideal world ad sales teams will be able to sell every single available impression to advertisers to get premium CPM rates and maximise their income, but this isn’t always possible.
As an example, your website might have an expected 1,000,000 ad impressions to sell in the coming months, based on previous Google Analytics data. If you have arrangements with 3 brands to sell 800,000 of these ad impressions, that leaves you 200,000 unsold ad impressions. It is these 200,000 ad impressions which we refer to as remnant inventory.
What Should You Do With Remnant Inventory?
You have a number of options of what you can do with remnant inventory.
Give bonus impressions to existing advertisers
I always over deliver for any brand which chooses to advertise on one of my websites. Normally I’ll over deliver by 10% to 20% depending on the size of the campaign. It costs me nothing, unless you are counting the opportunity cost of what I could’ve hypothetically done with those unsold impressions had I not given them away. Over delivering keeps your premium advertisers happy and helps you to establish good long term relationships.
Run ‘house ads’
The definition of a ‘house ad’ is “a self-promotional ad a website runs on its own site to put unsold inventory to use”. There is nothing wrong in creating ads for your own website to promote important or new sections on your website.
- If you offer a course, then you can use remnant inventory to promote the course. This is what I do with the Monetization Method course.
- If you make money via affiliate links, and one particular article accounts for most of your affiliate revenue, promote that article in a banner ad.
- If you just launched a new section, then create an ad to send visitors to it.
- If you are trying to build your social media following, you can use ads to request people join your Facebook Group, follow you on Instagram etc
When it comes to house ads, our advice is to think about what sections of your website earn you the most revenue, and promote those sections. You might find this method generates more revenue for you than you might have been able to get selling those ads to other brands!
Run Ads From Affiliate Marketing Partners
No matter what niche you are in, there is likely to be an affiliate program that your visitors will be interested in. Generally I avoid low paying affiliate programs such as Amazon. Your website is your pride and joy, and getting pay 3$ of a $30 sale to make 90 cents is super demotivating! (of course if your site gets millions of visitors each month then those cents can begin to add up, but for most websites low paying affiliate programs simply create a little extra beer or coffee money).
Find an affiliate program that will earn you at least $30 for each sale, or will give you a similar amount of credit on an account that your frequently use. An example of the later is food box program Hello Fresh, who credit your account $50 for each sale you refer. If you had a food blog you could add a banner for HelloFresh and get $50 credit each time someone buy using your banner.
Run programmatic ads
“Programmatic” refers to the automated buying and selling of online ads through platforms such as Google Adsense, Ezoic, and Mediavine. Typically, the CPM rates are lower than you would be able to achieve if you were to sell the display ads directly to advertisers.
For this reason, my monetization strategy when it comes to display ads is always:
Sell as much ad space as possible directly to advertisers, then use programmatic ads to fill the gaps if their are unsold impressions left over.
Doing this means you are collecting as much revenue as you can through banner ads. It’s worth noting however that most small website owners never think this way. They’ll use programmatic ads from Day 1, and wait years before even trying to sell ad space directly to brands.
What does remnant inventory mean?
Remnant inventory simply refers to any ad space which has not been purchased by an advertiser. Remnant inventory can then be gifted to existing advertisers, used for house ads, or through other monetization strategies.
What should I do with remnant inventory?
Only you can answer that. Base your decision on what is most likely to result in additional revenue for your website. Would rewarding existing advertisers result in lucrative future campaigns? Would running house ads for other sections of your website increase revenue from within those sections? Is there a high paying affiliate offer you can promote? Would you be happy with a $1 or $2 CPM from an ad network such as Google Adsense?
Once you’ve thought through these scenarios, you’ll have a better idea of what you should do with your remnant inventory.
Why is there remnant inventory available?
Remnant inventory exists for multiple reasons.
Firstly, website traffic fluctuates. You might be expecting 800,000 ad impressions during July, but perhaps something happens in your industry which means there is more search traffic for your key terms and you are suddenly on track to get 1,200,000 ad impressions during July. That’s, 400,000 ad impressions which you have not sold, and suddenly become usable for other purposes.
Secondly, advertisers can pull campaigns at the last minute. Although most ad sales contract will have penalties for advertisers pulling out at the last minute, it does happen. If an advertiser is booked for 200,000 Homepage ad impressions and suddenly cancels the deal, then those 200,000 impressions are new remnant inventory.