Last week we talked about Google Adwords.
Yes, it’s easy to get a flood of traffic with Adwords. And yes, it’s possible to get that traffic for as little as a penny.
But guess what…you might be over-paying, even at a penny!
Let’s say you’re promoting a CPA offer that pays you 50 cents per lead. If you’re buying 10,000 clicks at a penny, you’re spending $100. If only 100 people opt into the offer, you’ve earned $50.
Well, spending $100 to earn $50 isn’t the way to get rich in this world.
On the other hand, if 1000 people opted into the offer, you’d be earning $500. And trading $100 for $500 very much IS the way to get rich.
So what’s the difference between these two examples?
Well, the difference is the performance of the offer. In marketing terms, we’d say that the first offer had a lower conversion rate than the second offer. A conversion rate is the percentage of people who took the offer divided by the total number of people who saw it.
So the conversion rate of the first example is 100 divided by 10,000, which is .01, or 1 percent. The conversion rate of the second example is 1000 divided by 10,000, which is 0.10, or 10 percent.
Since the payout of the offer is 50 cents, that means that the value of a visitor is just a half of a penny (50 cents X 0.01 = 0.005, or a half a penny). For the second example, the visitor value is 5 cents.
So why bring this up? Why teach you about visitor value?
You shouldn’t judge the cost of traffic strictly on its price. Even at a penny — which sounds cheap — this particular traffic would be expensive.
You should instead judge the traffic on the difference between it’s cost and what you’ll be able to make from that traffic. I’d rather buy traffic at 4 cents a click if I know I’m going to make a nickel, than at a penny a click if I’m only going to make a half a penny.
Second, if you’re an affiliate, you don’t have a tremendous amount of control over conversion rates of an offer. You can’t switch a headline or change a price or the offer because it’s not your offer to change!
But you can change the kind of traffic you send.
You can improve your keywords, buy traffic from different sites, try different free and paid marketing methods…there’s lots you can do to change the kind of person who will see that ad.
And maybe those different kinds of people will give you a higher Value per Visitor.
There’s lots to this “make money online” business.
And we’re just scratching the surface here.
We get deeper in the Money Makers Coaching Club, though.
If you’re not yet a member, then sign up now. We’re talking this month about Tracking and Statistics. That’s because there’s no way to know your VPV unless you measure it.
And there’s no way to improve your VPV unless you can track it.
Would you ever open a savings account if the bank never told you how much money was in it?
Then you shouldn’t run an online business without testing and traffic.
More to come
To Your Success,