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Hey Publishers, this one’s for you. In case you aren’t on our mailing list for our weekly newsletter for Publishers, The Sidekick, you can check out the latest issue now! We’ve got another one in the works as we speak, and we recommend signing up for it here at the blog so it will be delivered directly to you! So convenient…
And now, The Sidekick for February 2010…
It’s December, which means much of the world is entering a holiday season of some
sort. It’s Hannukah for us, which is a great holiday if you like fried food (who
doesn’t); fried jelly-filled doughnuts, potato pancakes, and my favorite: jelly
pancakes wrapped around potatoes that are stuffed into a doughnut and fried.
That’s the Hannukah spirit all right!
It’s also a good time to sound the bell, reminding affiliates everywhere that just
because the holiday season is upon us doesn’t mean you have to only spend your
money; you can make money too!
Here is quick rundown of the promotions we have running on the Adsmarket
affiliate network, through Dec. 31.
The FAST LANE Sign-up Event.
It’s our biggest prize giveaway EVER, for unsigned Publisher
and Affiliates (you know who you are).
Prize Giveaways: Your chance to win from some of our biggest advertisers!
Wii, iPhone 3GS, a Sony Bravia, or a Trip to Amsterdam!
(For this one you have to be an Adsmarket Publisher.)
If you have any questions about these promotions, please send an email to
contactATadsmarket.com
This is the last in a 3-part series on analyzing online media quality. It’s a doozy,
but an in-depth look. If you missed the other installments, here’s Part 1 and
here’s Part 2.
The Sophisticated Approach
The sophisticated advertiser distinguishes between media sources and offers
a different CPA for each of them. Let’s take a simple example, an advertiser that
sets CPA at 3 levels:
In this example, all the traffic sources will run this offer, and the ROI will be
positive for all the sources.
| Media Type |
Quality |
Capacity |
CPA |
Revenue |
Total Cost |
Profit |
|
SEM |
10.00 |
10,000 |
6.00 |
100,000 |
60,000 |
40,000 |
|
Banners |
8.00 |
20,000 |
5.00 |
160,000 |
100,000 |
60,000 |
|
Email marketing |
6.00 |
30,000 |
5.00 |
180,000 |
150,000 |
30,000 |
|
Pops |
5.00 |
40,000 |
5.00 |
200,000 |
200,000 |
0 |
|
Incentivized |
3.00 |
60,000 |
2.00 |
180,000 |
120,000 |
60,000 |
|
Total |
190,000 |
In this way, 5 different levels can bring the advertiser up to $300,000 profit from
160,000 users.
Let’s summarize the profit for each advertiser:
|
Profit |
|
|
Unsophisticated advertiser |
$60,000 |
|
Semi-sophisticated advertiser |
$80,000 |
|
3 payout levels |
$190,000 |
|
5 payout levels |
$300,000 |
This model works not only in theory. In my experience working with advertisers at
Adsmarket, I’ve seen many empiric example of how advertisers dramatically
increased their revenue and their profit by handling and monitoring the traffic
sources better. This brings me to two major conclusions:
Feel free to contact me at Yuval.bATadsmarket.com to learn more about these tools
and about traffic source optimization in general.
Yuval Ben-Harush here, Advertiser Relations at your service! Many advertisers ask for our consultancy – “How can we make our offers more attractive and how can we bring more users to our offers?” The first question I ask them is: Who are your customers? The users? – Wrong! Your customers are the publishers! If you will keep in mind that your offers need to be attractive to the publishers, and take the right actions, they can drive unbelievable volumes of users to your offers.
There are two important parameters that you control as a saavy advertiser that influence the attractiveness of your offers to the publishers:
The first one is the most obvious one and the most easy to control: The Payouts (for CPA offers)! Your payouts need to be competitive (compared to other advertisers from the same category for the same countries) and must be profitable for the publishers, meaning, the cost of media will be lower than the total revenue.
Total revenue = CPA * Total number of conversions
Total cost of media = CPC * clicks (or CPM * impressions)
α = the ROI the publisher expects
As you can see in the Total Payout formula above, the second parameter that the publisher takes into consideration is the number of conversions per the traffic he sent. Since the advertiser is usually responsible for the creatives, including landing pages and banners, you have the power to influence the conversion rate for the publisher.
To explain the idea better, let’s take an example:
“Sylvester” is a publisher who wants to run a movie selling campaign in the US. In Adsmarket there are two companies who have such campaigns – Rambo LTD and Rocky INC. Rambo LTD offer $10 CPA per movie sale and Rocky INC offer $5 CPA per movie sale. At first glance, it looks like Rambo LTD offer, $10 payout, is more attractive for Sylvester; however, after testing both of the offers, Sylvester found out that out of 200 users (200 clicks) sent by him to Rambo LTD there were 2 sales (1% conversion rate). Out of the same amount of users sent to the Rocky INC offer there were 6 sales (3% conversion rate). The total incomes from Rambo LTD and Rocky INC are $20 and $30 respectively. Surely, Sylvester will prefer Rocky INC offer because, per 200 clicks, the revenue is higher. If the cost of media is for example $12 per 100 clicks (CPC) the conversion rate makes the different from a profitable and non-profitable campaign (see the table below).
|
|
Rambo LTD |
Rocky INC |
|
CPA |
$10 |
$5 |
|
Clicks |
200 |
200 |
|
Conversion Rate |
1% |
3% |
|
Conversions |
2 |
6 |
|
Total revenue |
$20 |
$30 |
|
Total cost for 200 click (CPC*2) |
$24 |
$24 |
|
Profit |
(-$4) |
$6 |
In order to compare performances of different campaigns with different amounts of traffic, publishers usually measure the profit per 100 clicks (EPC) or per 1000 impressions (eCPM).
| EPC = | Total revenue * 100 |
| # of Clicks |
| eCPM = | Total revenue * 1000 |
| # of Impressions |
In our example, Rambo LTD’s EPC was $10 and Rocky INC’s EPC was $15.
The EPC and eCPM functions elaborate the conversion rates and the CPAs. Bottom line, the publisher looks for the following as proof of a worthy campaign:
EPC > α * CPC
eCPM > α * CPM
How can this work to your advantage as an advertiser? By changing and adjusting the Payouts (CPA) and the conversion rates you can influence the publishers EPC and eCPM. Improving these values makes your offer more attractive and by that, encourages them to send more users to your offers.
In my next articles we will discuss ways to improve the conversion rate of a landing page and what is the right way to change and optimize the payouts.
[Note: I titled this post from the book “Blindness” by Jose Saramago. The book is completely unrelated to affiliate marketing, so take that in mind if you go out to buy the book later on today 
]
Maor Sadra here! The online advertising world is a jungle today (cue monkey sounds). There are so many sites, blogs, affiliates, publishers, media networks, etc. The more you spend online, the more likely your ads are being placed on thousands of sites. This is generally good news, but can marketers control their spending and optimize the results in this chaos?
If an advertiser is working with a blind network, there isn’t much they can do to track results by site or affiliate. You can never really predict results as you don’t control which affiliates or sites are running your offers. So what should advertisers do?
The two remaining options: transparent, or half-transparent (or half-blind, depending on how you look at it), will support an advertiser’s efforts to do better business, but only one of these really comes through for the advertiser.
On completely transparent networks, an advertiser can view a list of publishers running their offers and find out which publishers or sites are bringing them the most impressions & clicks. But it’s very possible that only 1/10 of the sites actually generate the results from beyond the click. Many networks and publishers prefer that the advertiser will not know this, fearing that the advertiser will optimize the campaign by limiting it to the best performing sites (which creates more work for the network employees to do, and leads to less revenue for the network…). When networks do this, they are ignoring the simple fact that the advertiser will drop the network entirely if the results are generally not good…
Some advertisers still choose to go with a transparent network without the ability to track results by site. I ask you: Why? Does it help the advertiser to know that an expert PPC affiliate c
alled: “expertPPCaff1982” is running their campaign, if they won’t know how good the long term results are from this affiliate?
I recommend that an online advertiser today use a sort of modified transparent network, which allows them to independently track a few parameters. While the name of the network can remain static, other parameters should be dynamic. A good example of this is tracking the performance by site or affiliate in an independent system.
Sounds like a lot of data? It is.
Sounds like a lot of work? It’s not really.
By tracking results per site/affiliate, advertisers can periodically analyze data to optimize and improve the results of the campaign over time.
Using this dynamic method of tracking will allow advertisers to find sites/affiliates within the network where there’s a high potential for quality traffic, and as every advertiser knows, finding quality sources is like finding gold! For these strong performers, advertisers can raise payouts or create customized marketing material or landing pages to increase the level of quality traffic. The opposite is also true; tracking also allows advertisers to spot which sites or affiliates drive lower quality traffic and make one of two calls: drop the site/affiliate from the campaign or optimize the creatives/landing pages to improve the results.
I always recommend that advertisers use a simple numeric site/affiliate ID, enough to get control over the results of their campaigns, and I encourage advertisers to identify sites or affiliates that drive quality traffic, which leads to a solid, trusting, relationship and mutual success. A true “win-win” situation.
I admit, for the advertiser it’s sometimes a hassle to manage a large advertising budget online on multiple channels with multiple CPA /ROI targets, but it the long run it’s worth it!
So my tip this time is pretty simple: It’s better to have at least one eye to see the true results than being totally blind. You don’t want to miss out on the amazing things you’ll stumble upon!
My name is Maor Sadra, Director of Sales at Adsmarket. This is my first (of many) blog posts to the Adsmarket blog. I welcome any comments you have!
I’ve been working in online advertising for the past 7 years, and while I always think that I know enough to get around in this dynamic industry, I always find that sometimes it’s good to listen to the people around me who may come up with the best “King of the Obvious” solution.
“King of the Obvious” is a term set by one of my former managers. This manager had a lot of experience in online advertising, but no technical experience whatsoever and needed some help with certain accounts.
Being young (oh, the hunger of youth!), tech-oriented and motivated to show that my technical skills can bridge any issue, I took on projects with Advertisers which included some programming.
One sunny day I received a spec for a new campaign that we were going to launch. My mind started all the geeky wheels in motion and I brain-stormed with myself the entire day trying to figure out how to setup this campaign.
If you’ve ever banged your head on the table trying to figure out how to solve something, you know exactly how I felt that day. And as you probably know, the banging doesn’t help.
After a long day of misery, I told my manager: “I can’t find any way of doing it…”.
He didn’t react at first, just looked at me strangely and asked: “Why are you thinking of the longest route from A to B when A is only 1 centimeter away from B?”
I was amazed. It was just like in Star Wars: Episode 5: The Empire Strikes Back, when Luke is trying to… okay, whoa, I’m showing my geek colors a little too much. Let’s just say that because I was overthinking it, I had turned a simple solution into a very complex riddle that I was unable to solve.
When I asked my manager, “Why didn’t I see that?!” he explained: “Sometimes you need to take a step back to become King of the Obvious.”
When I think of this case, I always remember a gem of advice for conversion funnels from Jared M. Spool about how a small change in a web form helped an eCommerce company increase their revenues by $300,000,000 in the first year. It’s explained in this famous article that after a few weeks of learning the user flow of the site, a small repositioning of the “proceed to checkout” button made such a huge improvement in the conversion funnel that it completely changed the user experience and led to many many more conversions.
The change itself? Allowing users to proceed to checkout without creating an account with the eCommerce site. We can all agree that allowing users to create an account would be helpful in the long term, allowing them make their purchase faster; however, let’s look at it from the customer’s perspective. When you go to a store and you want to buy a phone, or anything for that matter, do you want to enter a long term relationship with the store clerk, or do you want to select it, pay for it and go on with your life?
My tip for the day is: When you build your landing page, sometime you think of all the information you want from your users when asking them to sign up. Take a step back, become the King and think – what information does the customer want to give me, and do I really NEED all this other information? A clear, short registration form is the key to success with user retention.
King of the Obvious. Think about it.
Cheers,
Maor Sadra (maor.s@adsmarket.com)
Director of Sales
Global
México
Holanda
España
Brasil
