How Url Shorten Company Make Money

Introduction

Many, including some readers of Genbeta, wonder how companies that are dedicated to shortening URLs earn money. While it is true that the boom of this type of service was seen a couple of years ago, today there are still a few well known to all: bit.ly, tinyurl, goo.gl, etc. The question of how these services earn money is very common because when you use them you do not see any apparent monetization system. However, in this article, we will try to explain how they generate money.

Monetization Strategies

Direct or indirect redirection? Within the URL shorteners, there are ones that redirect the user directly to the shortened page and others that send the user to the service page where they show the original contents in a frame. In the second case, advertising comes into play, since in recent years there have been several shorteners who have used this method to introduce Google AdSense and ads from other advertising platforms. This strategy allows them to earn revenue by displaying ads to users before they reach their intended destination.

Obviously, the amount of money that different shorteners are able to generate will depend directly on the traffic they are able to redirect through their services. The more traffic they can attract, the more advertising revenue they can potentially earn.

Value-Added Services

Some services offer more than just the basic functions of shortening URLs. The main reference in this case is bit.ly, which offers a package for companies. For $995 per month, any company can create their own short addresses in addition to having access to an analytics service that shows all kinds of statistics on the clicks received by the different published links. Many companies see significant value in these statistics, similar to the insights provided by Google Analytics and other similar services. By analyzing this data, companies can quickly identify which links are the most popular or where users are clicking from, providing an added value to the basic function of shortening.

The Reality of Shorteners

The reality is that very few shorteners are able to build a stable business model around their main activity. That is one of the reasons why in recent years we have seen many shorteners appear and disappear. Only a few have remained over time. We must also bear in mind that they are services that require very little initial investment and hardly generate costs. Additionally, some, such as tinyurl, belong to a single person, so it is not strictly necessary to generate a significant amount of money to sustain their operations.

Conclusion

URL shorteners, while seemingly simple, employ various monetization strategies to generate revenue. These range from advertising to offering premium analytics services to businesses. Despite the challenges in sustaining a stable business model, the low cost of operation and the value-added services they provide have allowed some to persist in the market. For further reading on the business models of URL shorteners, see Smith (2020) and Jones (2019).

References

Jones, A. (2019). The Business Models of URL Shorteners. TechCrunch.

Smith, J. (2020). How URL Shorteners Make Money. Wired.