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PPC for High Value Products

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I'm currently running a number of adwords ads for my site.

 

The thing I like about these is that for the most part I can be pretty sure I'm receiving targeted traffic (as opposed to the kind that arrives via long tail keyword searches). Once users hit the site, it's then a question of how successfully my content converts them.

 

My question is this: for a high value product (we're talking up to a thousand dollars in some cases), how can I assess whether the adwords are likely to generate a net income without spending an amount almost equal to the value of the product?

 

Currently, I might burn through $999 before I make the one conversion that means I'm at break-even. Or $499 before I make the one conversion that implies that I can make $500 for every $500 I spend on adwords.

 

If we were talking about a $15 product, it's pretty cheap and easy to get the information needed to assess whether it's going to be profitable method for marketing it, but for a more expensive product it seems as though a significant upfront investment would be required.

 

Any suggestions, or is this just the way it is?

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I'm currently running a number of adwords ads for my site.

 

The thing I like about these is that for the most part I can be pretty sure I'm receiving targeted traffic (as opposed to the kind that arrives via long tail keyword searches). Once users hit the site, it's then a question of how successfully my content converts them.

 

If you're only breaking even it's obviously not targeted traffic. Surely you're not paying $999 for clicks on a $1k product.

 

It might be a better strategy to run the ads on potential longtail, narrow down to the best performers then target organic SERPs (SEO) for those same proven performers.

 

If you target ads for the most popular niche keywords you're pretty much guaranteed to pay the highest price per CTR because of competition.

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Surely you're not paying $999 for clicks on a $1k product.

 

Sorry, I wasn't very clear.

 

I mean $999 in total - that might be for 999 clicks at $1 each.

 

My point is: unless you have some conversion rate that you know you should be achieving (say 1 sale per 100 clicks) then it is hard to assess performance until you reach that point at which you've spent more on advertising than you can possibly recoup from a sale.

 

To take my own scenario, I pay around 2 cents per click. My average conversion probably earns me $300. So if I achieve one conversion per 15k clicks then I'm going to break even. I don't know that I will achieve one conversion per 15k clicks though.

 

If you got to 10k clicks (at a cost of $200) and hadn't achieved a conversion, wouldn't you be likely to bail?

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You generally should not need 1000 clicks to figure out if something is converting or not.

 

I think your real concern is something more along the lines of it costs $75 per click, but what you are selling makes you $1,500 per sale. Now if you convert at 5% you are paying $7500 for 100 clicks, but you made 5 sales which netted you $7500. You broke even on a more limited sample. However if you only had converted at 2%, you just lost almost $5k.

 

I believe this is more of the kind of example you are getting at.

 

For these sort of situations it really has to be a market you are extremely familiar with. You need to know the target market inside and out, You need to understand the demographics. You need to do a lot of research of the competitors that are running major ad campaigns and understand what they are doing and why it is working.

 

There really is no test you can run that does not put you at risk of losing your shirt in this case. Instead of testing ads and tweaking you need to know your shit before jumping in.

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Thanks Yukon and Mike.

 

I wouldn't say that I know the market inside out. Also, I'm not directing ads to pages that can't be accessed by normal search, so I don't know whether the conversions I make are coming from adwords, organic, or other traffic sources. I probably ought to fix that.

 

I don't think there's any danger of me 'losing my shirt' with PPC ads (at 2 cents a pop). I'd just prefer not to throw away several hundred dollars that could be better spent on something else. Like on upgrading my membership here.

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Sorry, I wasn't very clear.

 

I mean $999 in total - that might be for 999 clicks at $1 each.

 

My point is: unless you have some conversion rate that you know you should be achieving (say 1 sale per 100 clicks) then it is hard to assess performance until you reach that point at which you've spent more on advertising than you can possibly recoup from a sale.

 

To take my own scenario, I pay around 2 cents per click. My average conversion probably earns me $300. So if I achieve one conversion per 15k clicks then I'm going to break even. I don't know that I will achieve one conversion per 15k clicks though.

 

If you got to 10k clicks (at a cost of $200) and hadn't achieved a conversion, wouldn't you be likely to bail?

Oh geeze. Only 2 cents a click?

 

Here's a question - how many ad clicks was it to get your first conversion? Or you just don't really know because you've not been tracking everything else? Is your site ranking at all for the keyword(s) you are bidding on?

 

Here's a story for you.

 

I'll pause for a moment so you can make yourself a cocktail and get cozy. Keep in mind I'm a girl so I may ramble a bit.

 

Ready?

 

So there is this story about this girl. The one you see in the picture there. She had just lost a ton of weight. Like 77 lbs.

 

She'd never done a website before, but had joined a diet site that helped her lose the weight - and that diet site had an affiliate program.

 

She had wanted to do web stuff  before, but always got stuck on just getting a site up. This was back in 2007 before it was so easy to just pop one up. And many would probably agree with me that the first site can seem like a daunting task when you don't have any knowledge of html, and you don't realize there is a wysiwyg on some of these things. And even then you need to figure out some content for pages and some pictures.

 

Anyway, she thought that she could stick a site up and magically people would just find it. She was a blonde after all.

 

So, she was reading this guide on MMO - you know, one of those that you come across and it really was 4am and she just bought it because she needed some guidance. I think she paid like $67 for it at the time (maybe $77) which was nothing to sneeze at. I think she was drunk too. That always helps with the 4am sales.

 

This particular guide was all about some adwords stuff. Finding cheap keywords, using the spin of a negative ad, and making some money.

 

So this girl, realizing she knew the product inside and out and that it had worked for her too decided she needed to just get a website up asap. She was approved for the affiliate program as she was a member of the site - but she didn't even need to be.

 

Hesitant to commit to $5 a month for a website (on godaddy website tonight) she bit the bullet and signed up for making her first real site.

About 4 hours later on a Sunday night, the site was built and done. No clue about SEO mind you - but just got something up which is always a great accomplishment.

 

So now she followed what that book told her to do and went out and used the product name as the keyword for an adwords campaign. It was going to cost her a nickle a click. She put a limit on it to $5 a day because she was just a waitress and not really knowing what she was doing she got scared of getting too far in over her head. 5 bucks is 5 bucks. 5 dollars goes a long way at the dollar store. :blink:

 

Monday she got the ad up. By Wednesday, she got her first sale. And another one or two trickled in by that Friday. This was for a 13 dollar or so product at the time, and I think the ad spend total was only a couple of bucks?  But it was more than enough profit to let things ride. She was very excited about this whole affiliate marketing thing. It was the first made that way. Only other money made before that was just selling some ebay stuff.

 

The next month, same kind of thing going on. A few more sales here and enough to cover that ad spend. (oh gosh, if she only knew more about testing and tracking and improving landing pages at that time and silly SEO -grrrrrrr)

 

Her site was not ranking. She didn't even know about ranking or what was even needed to do it. She had another big thing going on too - where she had typed in "loose weight" instead of "lose weight" and maybe that did something or not - we'll never know now. lol

 

One day she got an alert on the diet forum that the diet was about to hit the front page of one of those trash magazines you see in the supermarket at the check out stand. Referring back to her $67 guide, she was told that this kind of thing happening was going to be a gold mine waiting to happen. She was excited, but hesitant at the same time as this was unchartered ground.

 

She gathered all her tips from her waitress job for a good couple of weeks in anticipation of having funds enough ready to hike that five dollar daily budget to a hundred bucks a day. This was going to be very scary for her as she'd never spent this kind of money on something so crazy before.

 

She had to go to work. It was a Thursday, and supposedly that magazine had just hit the stands. She upped the budget, crossed her fingers, and went off to work.

 

The next day she went into check her stats, and low and behold there was several hundred dollars in sales. Could it have been more? Why yes! But her $100 ran out!

 

She knew she had to up the budget even more on that ad spend. By Tuesday of the following week she was shelling out $300 a day and clearing over 1k in profits a day.

 

This was it! It was amazing! She decided to quit her job!

 

Some problems came up on Tuesday. Stupid stuff.

 

Godaddy was starting to hassle her cause the traffic was going nuts on her site.

The site she was promoting went DOWN because it was getting way too much traffic.

She was paying for ad clicks that would hit her site, but when they tried to click to the affiliate link, the end site was down so money was going in the toilet.

She only noticed she'd been spending a lot on adwords but sales went into a freeze.

 

Oh, it was a mess. Silly girl realized she needed to get an autoresponder up and fast so she could collect names of those who couldn't get through to a sale so she could send them on back when things got fixed.

 

Funny how quickly you learn Aweber when you've got hundreds a day in ad spend going in the crapper. lol, fire under your ass and all.

 

Things finally got fixed finally on the end site, but she had no money left for ad spend and was going to have to wait for an affiliate payment in order to carry on.

 

Again, she had no clue about SEO and so she went from money to no money for a couple of days. But luckily that LIST was there so she could email them and trickle in a few more sales.

 

Now I'm not going to bore you with the end of this whole story as it is tragic. In a nutshell, girl had to drop selling the whole product all together because of discoveries made as to ethical things and something that trailed into a 3 year lawsuit (problems with the product itself).

 

But here is what I want to emphasis from the whole experience.

 

You need to have tracking in place and need to see how people are finding your site.

You probably need to have an AR set up so you can collect peoples names - especially when you are paying for traffic to your site.

If you've found a 2 cent keyword that is really where the traffic is coming from, you have a really special little thing there. Take advantage of it! Test all different kinds of ads with it. If that is what is bringing the traffic to your site, 2 cents is nothing to pay for a new list member. You can always try to sell them something else!

 

If you can create some kind of press release for what ever it is you are selling or if you catch wind there is some kind of media promotion going on for it then it's time to really start crunching your numbers and try not to freak too much on your ad spend.

 

 

I wouldn't say that I know the market inside out. Also, I'm not directing ads to pages that can't be accessed by normal search, so I don't know whether the conversions I make are coming from adwords, organic, or other traffic sources. I probably ought to fix that.

 

From the desk of the confirmed spinster here: Yes. You need to fix that.

 

I'd just prefer not to throw away several hundred dollars that could be better spent on something else. Like on upgrading my membership here.

If you are collecting names, this won't feel like a total loss. If there is a way to create a list from what ever you are selling then just do it.

 

You are obviously getting some converting traffic to the site already.

 

Time to tighten up the reigns and you will have money back to pay for a nice private membership here.

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Now I'm not going to bore you with the end of this whole story as it is tragic. In a nutshell, girl had to drop selling the whole product all together because of discoveries made as to ethical things and something that trailed into a 3 year lawsuit (problems with the product itself).

 

But here is what I want to emphasis from the whole experience.

 

You need to have tracking in place and need to see how people are finding your site.

You probably need to have an AR set up so you can collect peoples names - especially when you are paying for traffic to your site.

If you've found a 2 cent keyword that is really where the traffic is coming from, you have a really special little thing there. Take advantage of it! Test all different kinds of ads with it. If that is what is bringing the traffic to your site, 2 cents is nothing to pay for a new list member. You can always try to sell them something else!

 

If you can create some kind of press release for what ever it is you are selling or if you catch wind there is some kind of media promotion going on for it then it's time to really start crunching your numbers and try not to freak too much on your ad spend.

 

 

From the desk of the confirmed spinster here: Yes. You need to fix that.

If you are collecting names, this won't feel like a total loss. If there is a way to create a list from what ever you are selling then just do it.

 

You are obviously getting some converting traffic to the site already.

 

Time to tighten up the reigns and you will have money back to pay for a nice private membership here.

 

Hi Jill,

 

Thanks for an awesome and really helpful reply!

 

In terms of the 2 cent keywords, I'm dealing with a form of affiliate marketing, and here's what I think is going on . . . The companies that I'm marketing (and all the hundreds of others selling the same thing that I don't market) all use adwords. They don't want their own affiliates bidding up their brand keywords, and they expressly forbid this in their terms and conditions (I discovered this after I ran adsense on a site and saw that I was getting pennies for clicks on ads from these companies).

 

The result is that the brand related keywords only seem to have the company themselves bidding on them.

 

If you were interested in diets and had heard about the Acme Diet and googled it, and saw my ad that said 'How safe is the Acme Diet?' you might click on it. I can then show you a page comparing the Acme Diet with the XYZ Diet, and XYZ are the firm I introduce for.

 

If there are 300 diet companies, of which I am an affiliate for 10, then this leaves 290 companies, and each of those might have 100 or so keywords that are searched, so that's 29,000 keywords I can bid on at very low prices. Some of those keywords might only get 10 searches per month, but they add up.

 

So the strategy I'm using is to bid on the keywords relating to companies that I'm not an affiliate for, rather than the ones that I am an affiliate for.

 

The potential problem is this . . . What percentage of people who search 'Acme Diet' are really only interested in the Acme Diet? Yes, they'll click on an ad and read about how it compares to the XYZ Diet, but they're never going to buy the XYZ Diet because . . . It's not the diet that Lucy Lawless is on in the magazine article that they read (sorry Jill, Xena Princess Warrior is about the only NZ celebrity import to the UK!). I don't know, and spending some money seems the only way to find out.

 

As for building a mailing list, that just doesn't seem to work for what I'm selling. Most people who visit my site are going to own the product by the end of that same day, and they're never going to buy it again.

 

What I am about to try instead is a sales page (you know, the Gary Halbert style 'squeeze page' type things) with a free, no subscription required PDF at the bottom. The page will convince visitors to narrow down their search to just 3 providers, then one of the 3 listed will be outside their price range, and the other two will carry my affiliate links.

 

Have you had much experience with type of 'squeeze page' sales approach? I've avoided it previously on the basis that I consider it "trashy" and would quickly click off that kind of page myself, but I think I ought to give it a go. And I'll be able to really carefully monitor conversion for these pages because they won't be accessible from organic search.

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So the strategy I'm using is to bid on the keywords relating to companies that I'm not an affiliate for, rather than the ones that I am an affiliate for.

 

The potential problem is this . . . What percentage of people who search 'Acme Diet' are really only interested in the Acme Diet? Yes, they'll click on an ad and read about how it compares to the XYZ Diet, but they're never going to buy the XYZ Diet because . . . It's not the diet that Lucy Lawless is on in the magazine article that they read (sorry Jill, Xena Princess Warrior is about the only NZ celebrity import to the UK!). I don't know, and spending some money seems the only way to find out.

 

 

You are right in that conversions will probably be low for ads bidding on just the brand name of the diets. What you need to do is go after keywords that are more of the people trying to make a decision versus people who already have their mind made up. You want the Acme diet tire kickers.

 

Does the Acme diet really work?

Is the Acme diet better than XYZ diet?

Acme diet reviews

Acme diet testimonials

Is the Acme diet good for losing weight?

Is the Acme diet a healthy way to lose weight?

 

I'm just throwing out ideas off the top of my head. Search volume will be lower for this stuff, but conversions are likely to be higher.

 

From here in the sales process you are going to pivot. You bring them in thinking about one product, give them the disadvantages of that product, and then offer a better solution to the problem they had.

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In terms of the 2 cent keywords, I'm dealing with a form of affiliate marketing, and here's what I think is going on . . . The companies that I'm marketing (and all the hundreds of others selling the same thing that I don't market) all use adwords. They don't want their own affiliates bidding up their brand keywords, and they expressly forbid this in their terms and conditions (I discovered this after I ran adsense on a site and saw that I was getting pennies for clicks on ads from these companies).

 

The result is that the brand related keywords only seem to have the company themselves bidding on them.

 

Yes, this is common. You can always ask permission, but may not always get it.

 

 

If you were interested in diets and had heard about the Acme Diet and googled it, and saw my ad that said 'How safe is the Acme Diet?' you might click on it. I can then show you a page comparing the Acme Diet with the XYZ Diet, and XYZ are the firm I introduce for.

 

If there are 300 diet companies, of which I am an affiliate for 10, then this leaves 290 companies, and each of those might have 100 or so keywords that are searched, so that's 29,000 keywords I can bid on at very low prices. Some of those keywords might only get 10 searches per month, but they add up.

Are you building landing pages specifically for ads based on those other 290? Like Acme Diet gets it's own ads to test and it's own landing page? Or are you pushing all those affiliate offers in one shot?

 

 

As for building a mailing list, that just doesn't seem to work for what I'm selling. Most people who visit my site are going to own the product by the end of that same day, and they're never going to buy it again.

 

Yes, I understand. But this is where you can offer other things they are going to need with that niche/diet.  There is always something else I've found. The diet I was selling was a low carb thing, so I found a free low carb guide that was going to assist those people as my "get access to this guide when you sign up" - and of course from there knowing the diet I had the option to then promote food products sold online that they would need. Or exercise stuff, or all kinds of things that go with people who are on diets.

 

The question is "what do all people who buy x also have to buy or want to buy?" Another question - can you get a coupon or something from any of those affiliate programs that only you offer?

 

There is a way to funnel it too so immediately after them signing up to your list they are kicked right to the actual sales page of the offer.

 

And maybe you've already brainstormed on this and you really don't have any other options but to make a sale and run. I don't discount that as I just don't know your niche.

 

 

 

What I am about to try instead is a sales page (you know, the Gary Halbert style 'squeeze page' type things) with a free, no subscription required PDF at the bottom. The page will convince visitors to narrow down their search to just 3 providers, then one of the 3 listed will be outside their price range, and the other two will carry my affiliate links.

 

Have you had much experience with type of 'squeeze page' sales approach? I've avoided it previously on the basis that I consider it "trashy" and would quickly click off that kind of page myself, but I think I ought to give it a go. And I'll be able to really carefully monitor conversion for these pages because they won't be accessible from organic search.

 

 

There are a couple of ways to work this too. And you can always also include a link on that PDF to a page that is a sign up of some kind.

 

The other thing you can do with a PDF that you are just handing out is add it to what ever document sharing sites you can scramble up. Used to be able to use some of the profile pages on those sites for an SEO benefit as well - but I've not done it in a while.

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You are right in that conversions will probably be low for ads bidding on just the brand name of the diets. What you need to do is go after keywords that are more of the people trying to make a decision versus people who already have their mind made up. You want the Acme diet tire kickers.

 

Does the Acme diet really work?

Is the Acme diet better than XYZ diet?

Acme diet reviews

Acme diet testimonials

Is the Acme diet good for losing weight?

Is the Acme diet a healthy way to lose weight?

 

I'm just throwing out ideas off the top of my head. Search volume will be lower for this stuff, but conversions are likely to be higher.

 

From here in the sales process you are going to pivot. You bring them in thinking about one product, give them the disadvantages of that product, and then offer a better solution to the problem they had.

Hi Mike,

 

Yes, what you describe was pretty much exactly my thought process.

 

So far I have only aimed to see whether I could bid ridiculously low on these types of keywords and get a decent number of impressions, and get a decent click through rate on the basis of my ad text . . . I haven't yet worked on trying to hone the actual 'sales pivot' process on my landing pages. To be honest, currently for these ads I'm just showing my generic comparison page.

 

Basically, I didn't want to spend lots of time and effort on building the specialized landing pages (and researching the competing products) only to find that I couldn't get enough 'tyre kicker' traffic through the door cheaply. The indications are that I can get enough cheap traffic this way, so now I will do as you suggest and think through the keyword selection more carefully, and build some dedicated landing pages.

 

Thanks for the suggestions.

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Yes, this is common. You can always ask permission, but may not always get it.

 

There are a couple of ways to work this too. And you can always also include a link on that PDF to a page that is a sign up of some kind.

 

The other thing you can do with a PDF that you are just handing out is add it to what ever document sharing sites you can scramble up. Used to be able to use some of the profile pages on those sites for an SEO benefit as well - but I've not done it in a while.

 

Hi Jill,

 

I'm currently pushing everyone to one generic comparison page - see conversation above with Mike - the next step is to improve on this.

 

I think that offering a related product would probably work, I'm just wary of diluting my focus too much at this stage by spinning off endless elements and then not managing to market any of them successfully. I've also got 'silo-trauma' going on at the moment (I haven't received a single visitor via organic search today!), plus PBN type sites to push on with . . .

 

I like the idea of putting a subscription link into the PDF though - that would also sidestep all the 'data harvesting on landing pages' issues with adwords.

 

Getting discounts offers . . . they all run them, but I'm not sure whether I can get anything that is exclusive. Although, given the value of a referral to me, I suppose I could put together an exclusive offer of my own and swallow this as a cost on the referral - definitely something to consider there :)

 

Thanks for the ideas!

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