Let me get this out of the way, I do NOT have the end all answer to monetizing search traffic that originates from Google Image Search.  Traditionally image search traffic does not convert well and requires different methods of monetization than content search traffic.  I've done a lot of looking around the guru sites and no one seems to have a solid answer on what works best for monetizing a website that depends on image searches for their visitors.

BritePic looks like a good place to start and will require some more testing before I'm convinced it's not actually causing a higher bounce rate.  The problem is that my visitors are viewing my website through Google's frames, which hides the majority of my site.  I've tried the script that breaks Google's Image Search frame, but had negative results after a few months, meaning lower image search numbers.  I'd rather keep my non converting traffic and find another way to monetize.

Back to BritePic's issues.  I'm not convinced that BritePic script images are searchable and hold as much weight as a normal image post would.  Therefore I wouldn't be bringing in the traffic to monetize against anyway.  Lastly, my visitors are more likely to view the enlarged image than just hover over the medium sized image on my blog.  Angered visitors, visitors lost, still no monetary gain from image search traffic.

In conclusion, I feel the only way to properly monetize image search traffic is with better affiliate banner and text ad placement.  This comes with it's own set of problems, like how much blending is too much, and is Google going to be upset about where you place the block of ads.  They tend to frown upon a large block above an image and directly below your post title.  I believe they want more content next to the ad, rather than a simple block next to a block which can potentially confuse a visitor into a click.

So far, it looks like Adsense still converts the best with Image Search traffic, but requires placement above the image, but around actual content.  I failed miserably when trying to place Chitika Ads at the top of a blog post, which has no qualms about where it's placed in relation to post title and image.  Chitika Premium ads still look like they convert the best at the bottom of a post, for whatever reason.

More testing is required, but I wanted to get this quick post out, which harbors some of my thoughts and issues.  I'm sure there is a quality solution to monetizing Google Image Search traffic and it may be the next big thing.