3 ways to drive increased profits
Assuming that you have a somewhat mature PPC lead based (not products) campaign within a vertical that has all appropriate keywords with properly set bids etc. I can think of three simple ways to earn more profit from that campaign.
1. Pay less for each visitor - most people attempt this by lowering bids dramatically - this seems to be the most common and least profitable, since you typically also sacrifice volume. You can also improve your quality score (think SEO on landing pages) hoping to get a reduction, but this is sometimes problematic and certainly not a slam dunk process. Another idea is to find areas where your max bid is significantly higher than your actual CPC. Say you are bidding $3.00 and the CPC is $1.75 - try lowering the bid to $2.50. 9 times out of 10 your CPC will go down without a change in position.
2. Convert more of the existing visitors you have - Optimize your landing page to convert at a higher pace. Change things subtly (button text to “order now”, or “Continue” or “next”) or dramatically (New hero shots, totally different layouts etc) and take the same pool of visitors you have now and convert more of them into sales. If you control the form, be sure to optimize that as well. Since you have already paid for the visitors each additional sale is 100% pure profit. Small tweaks can result in huge gains.
3. Get paid more for each sale - Go directly to the vendor and ask for higher payouts. Cut out affiliate network middlemen. Do not allow others to profit off of your work. If they will pay $25 a lead, they will probably pay $30, especially if you turn the faucet off for a day or two.
Simple Numbers to illustrate this point (totally made up…)
Assume 1000 visitors a day at a $1.00 CPC with $2.00 max bids.
5% of those visitors convert = 50 sales.
Payout per sale/lead = $35
So you are making $750 per day from this campaign (($35*50)-($1*1000))
Now assume you:
+decrease CPC by $.10 a click without losing position by reducing bids to $1.50 for a CPC of $.90
+Increase Conversion rate to 6% = 60 sales
+Increase Payout to $40
You are now earning $1500 a day (($40*60)-($.9*1000))
3 relatively small improvements doubled your daily profit.
Once you get something that is modestly successful, really small tweaks have dramatic consequences.
****There is a 4th lever which many fail to consider which is that you can increase your bids, move up in position, get more clicks and earn less per click, but probably improve conversion rate as well, for more total profit. This is risky and not for the feint of heart.****
October 4th, 2007 at 12:30 pm
Great post however I’d like to add a couple more things.
4. Multiple Monetization of the leads you’re capturing. Now this will require private labeling offers and capturing of data however there’s multiple ways to monetize the same person.
- 1. add them to your email list, as these are typically going to be highly targeted people that you can email other offers to in the future. Say you’re promoting debt consolidation what other things might these people need? Credit repair, Credit Reports, Payday Loans, Equity Lines the list goes on.
-2. Pre-populated offers on pop-unders or exit pages depending on what the vendor will let you do. Also can pre-populate the offer in the emails you send so they click the link and the form is already filled based on the data you already have. For example on running a mortgage lead offer often times those people respond to home insurance or home security pretty well. So if you have them fill out an offer for a mortgage do a pop-under pre-populated form for a Free Home Security appraisal. if you get 1000 leads a month and a 5% conversion rate on the pre-pop form with 10$ a lead that’s an additional 50*10 or $500.
-3. adding a co-reg stuff to your landing page. Ever seen a checkbox with something like “Are you interested in a Free Something as well?” This is a co-reg capture. Sometimes you can sell these as actual leads based on the data they filled out for something else. Also it’ll give you a more targeted list to contact later.
5. If you have a private label break it into a multi-part form. Now head warning here sometimes multi-part forms will kill your conversions quite a bit so it’s not worth doing. However if possible make your form at least 2 parts and capture some basic contact data on the first one then the rest of the stuff on the second. This way if you lead doesn’t complete the offer you’ll still have their data to email to later.
These are just a couple of ideas. But you get the picture. Based on this you might be able to see how someone can bid a lot higher on a word vs. what you do.
October 5th, 2007 at 10:38 am
I’m assuming the “hero shot” you are talking about is an image of a person on the landing page. Am I close in this assumption or totally off base?
October 5th, 2007 at 2:47 pm
Ride - Yes that is correct, the image does not even have to be a person, but that is where the name comes from.
Smaxor - all excellent suggestions for further revenue expansion.