The average conversion rates I'm familiar with (in just about any given industry) seem to hover between 1-2 percent. When I look at an Adwords equation where I pay $0.25 per click, my numbers (see below) say that I'd need to bring in no less than $25 compensation on every conversion.
Sure, the $45 Ebay registration looks good. But what about all the other affiliate programs that pay 5-10 percent? If my $0.25 link to Amazon pays me only 5 percent commissions, a customer would have to
spend $500 to make it worth my while to run the ad. That doesn't seem likely at Amazon.
Am I missing something here?
Assume 1,000 clicks/day with average CPC of $0.25
1000 x $0.25 = $250 net cost Google AdWords
Apply conversion rate of 2% to this traffic:
1000 x .02 = 20 buyers
Average commission needed to break even:
$250(net cost) / 20 = $12.50
Average commission needed to make a reasonable profit (100% markup)
$12.50 x 2 = $25
re paying big bucks in lead gen: sometimes true sometimes not. PPC to merchant direct? Definitely expensive.
Even before the Adwords change, I was paying up to $5 per click to generate traffic for some financial lead gen programs... not exactly cheap.
On my very best earner, however, I found a way to pay 5 cents a click in a related subject, send traffic to a small site built around the related subject that introduces the expensive subject and then send traffic to the high payout lead gen program. Cross-selling.
Also you mentioned ebay. Of the campaigns I'm running they seem to be the most consistant and while the 10 cent commision is not making me any money it usually covers that days cost of advertising. Good luck
Of the campaigns I'm running they seem to be the most consistant and while the 10 cent commision is not making me any money it usually covers that days cost of advertising. Good luck
Wow. If a 10 cent commission covers the cost, then even if you advertise at the very minimum of 5 cents, one in every 2 persons who clicks on your ad will have to bid or buy on eBay. Is your conversion rate so high?
profit per customer x conversion rate > max-CPC
or in other words:
$0.10 x y(given conversion rate)= $.05(max-CPC)
$.05(max-CPC) / $.10(Ebay commisssion) = y
y = 0.50 (50% conversion rate needed to break even)
Here's my question. I recently switched from selling Sirius satellite radios to ink cartridges. The first day I posted(yesterday) an ad I made $15 in 4 clicks. I was paying $2 a click with a budget of $10 a day. So today I raised my budget to $100 a day and $3 a click. So far I only made $20. But the day is still young.
Good idea? Bad idea? Google recommends a $1,000 a day! sheesh! Guess that's a sign the ink market is pretty well saturated. lol
I'm open for any suggestions. lower it raise it...what you would do, wouldn't do...
1) A conversion rate between 25-100 percent?
2) A commission from one cartridge that's at least $3.75?
Is this really happening?
you don't get into the best programs from the start
I'd have to disagree with that too. Lots of merchants have their programs set on auto approval. If you do some product research & know how to market consumer products and have a little creativity you can sell anything online via AdWords as an affiliate and make a nice chunk of change.
Here's my question. I recently switched from selling Sirius satellite radios to ink cartridges. The first day I posted(yesterday) an ad I made $15 in 4 clicks. I was paying $2 a click with a budget of $10 a day. So today I raised my budget to $100 a day and $3 a click. So far I only made $20. But the day is still young.
The $15 from 4 clicks was likely a fluke. You need a lot more than 4 clicks to see what kind of conversion ratio and average earnings per click you're going to get. From my experience, the best I've seen with ink merchants is about $1/click. That's from organic traffic, though. Good targeted PPC traffic might do better and there might be better merchants than the ones I'm using, too.
It sounds like you're probably bidding on some very generic terms. Pick some very specific ones instead (part numbers, for instance). You'll probably be able to get a much lower CPC and more traffic for the same amount of money.
you don't get into the best programs from the startI'd have to disagree with that too. Lots of merchants have their programs set on auto approval.
Skibum is right. Most good merchants are very approachable and either auto-approve or approve quickly. They're anxious to get good affiliates. Now finding the best merchants on the first try might be a different story. I usually try out a bunch of different merchants. Sometimes I'm quite surprised at which ones do the best.
The first couple of sales could have just been lucky.
Don't make any big moves unless you are certain what your conversion rate is.
I'd have to disagree with that too
I did not say that there are not any good programs available for beginners. There is a difference between BEST and GOOD.
I liked what I read about that specific keywords. I'm going to try that. The key word I'm using(ink cartridges) is too general and frankly too expensive at the moment from my what I've learned so far.
[edited by: eWhisper at 3:24 pm (utc) on Feb. 9, 2005]
[edit reason] Please Don't Drop URLs [/edit]
There have been others who expressed the same thing, and I've had it happen a couple of times... a quick bunch of sales right when the Ad starts and then nothing.
Haven't seen a very good explanation for it yet.
If CJ is not a given, then where's a good place to learn about different ways to build affiliate relationships with merchants?
