How much do you start out paying per click to promote a CPA offer?

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Setec

Setec

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Nov 1, 2006
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I've been trying to get into PPC affiliate stuff by promoting AzoogleAds offers. But so far I'm having a really hard time driving traffic, and I don't want to waste a bunch of money doing it wrong. On some niches I'm bidding over $1-$2/click on MSN AdCenter and still getting 1 click a day or less. I've tried 8 offers so far and the trafifc is still just a trickle.

I'll happily pay that much or more if I've got enough stats to know my ROI, but I was hoping to build some slow and cheap traffic before bumping my bids that high. The slow cheap traffic just isn't coming.

Does that mean I should keep trying new offers until I find one with cheaper traffic? Or is that never going to happen, and I should just bid higher?

What's the max you're willing to start out paying per click for an unproven offer?
 
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I hate saying this to so many threads buuut...it depends.

Use chrislingles adwords calc to guesstimate what you need to pay per click to break even on an offer. It uses openoffice, so you better download that (it's free) if you want to use it.

Another tip is bid high first to get a good CTR and position on your ad listing, then lower your bids once you have a good amount of data to safely do so and perhaps keep your position. I'm pretty sure that strategy only works for G and MSN.
 
The math isn't a problem for me -- it's an easy calculation, but it's just a guess until the conversion rate is known. I'm wondering how high most people bid before knowing the conversion rate.
 
Doesn't it depend on the payout? Or that's how I think about it. If you get $10 per sale and it's really unlikely that you'll get conversion rate of 1:10 so $1 per click is too much then. But if payout is $100 then you only need to convert 1% to break even so then paying $1 per click for starters doesn't sound so bad anymore..
 
micfire said:
Doesn't it depend on the payout? Or that's how I think about it. If you get $10 per sale and it's really unlikely that you'll get conversion rate of 1:10 so $1 per click is too much then. But if payout is $100 then you only need to convert 1% to break even so then paying $1 per click for starters doesn't sound so bad anymore..
Click to expand...

That is how I've always looked at it. I base everything on 100 visitors to keep it simple. If you bid $.20 per click, 100 visitors costs $20, if 2 (or 2%) convert at $20 a lead, then I just doubled my money.

Or take whatever percentage you think you can convert and multiply into the lead profit to see your breakeven point. 2% X $100 = $2 to breakeven on a $100 lead.
 
just look at the spreedsheet I gave. It does everything you are bloviating about in this thread! I make my break even point less than 2%. so the sheet figures what the payout is etc to give you a max cpc. can you bid more and still be profitable, sure, I quite often start out much higher and then adjust my campaign, I set a budget of what I am willing to spend to get the information, you more than likely will loose money at this but you are able to adjust your campaign and get the money back pretty quick if you are doing this right.
 
I recommend you don't pay more than 20 cents an offer, which is the avereage epc for most CPA offers. If your ROi is very good, then raise the bid so you get more traffic. If you can't make money find a new offer.
 
adsensedumbass you are an idiot, you recomend? fuck me running! the thing is your advice makes no sense, if you can't get traffic at $.20 what good is it? If you are looking at 2% conversion as a break even and the payout is $20 that means you are spending $40 to make money. If you are not getting a 4% conversion you suck and need to learn how to do something else.
 
Formulas for n00bs

It doesn't take a nuclear scientist to figure out the math here folks... Just like chrislingle, JDog, and micfire has pointed out - do the simple math, and adjust your estimates accordingly to your budget. This goes for both ppc -> arbi and ppc -> aff. marketing. (Or in fact, anything you expect ROI on)

If you don't have M$ Excel or don't want to / can't figure out how to download or use OpenOffice, then here are some simple formulas I personally use:

For PPC -> A.M:
--------------------------
CPA: The amount you make per sale (or lead or whatever you use)
minCTR: The minimum CTR you need to break even for the affiliate program / niche. It's important to note that "CTR" isn't exactly the same as with arbi, but to simplify things here - we mean: the percentage of visitors who actually go through with a sale or lead.
maxPPC: The maximum PPC you should be paying

minCTR = (maxPPC x 100) / CPA

maxPPC = (CTR x CPA) / 100

For PPC -> Arbi:
--------------------------
CPC: The amount you expect Adsense to pay you ON AVERAGE per visitor click. (Research carefully!)

minCTR = (maxPPC x 100) / CPA

maxPPC = (CTR x CPC) / 100


Example, PPC -> A.M. offer
----------------------------------------------
Let's say you wanna try an offer that pays $7,50 per lead. Normally with PPC -> Aff.marketing, CTR is around 1% - 5%, but again this depends on the offer and its conversion rate at the affiliate. As with anything, a little research is key here so try to guesstimate the popularity of the offer. Shoot for a realistic number first (meaning - go low), so try with 2% for example. That yields;

maxPPC = (2% x $7,50) / 100 = $0,15

So with $0,15 per click to get traffic, you will break even if 2% of the visitors you send to the merchant follows through with a sale or lead.
If you think you will only get a 1% CTR for this offer, then:

maxPPC = (1% x $7,50) / 100 = $0,075 cents

Remember, these are the maximum PPCs you should pay to break even. Now, play with the numbers to see what you need to do in order to make profit. And obviously - for higher payout offers, you can do higher PPCs.
 
The discussion of math is all well and good, but it doesn't really answer my original question, because it all hinges on knowing your conversion rate (or knowing what to expect it to be). So my question really is equivalent to asking what conversion rate is safe to assume when you're just starting a new campaign with no data. Chrislingle's 2% figure seems to answer that, although if I'm bidding to break even on a 2% conversion a lot of my offers will still get 0 traffic.
 
Setec said:
The discussion of math is all well and good, but it doesn't really answer my original question, because it all hinges on knowing your conversion rate (or knowing what to expect it to be). So my question really is equivalent to asking what conversion rate is safe to assume when you're just starting a new campaign with no data. Chrislingle's 2% figure seems to answer that, although if I'm bidding to break even on a 2% conversion a lot of my offers will still get 0 traffic.
Click to expand...

Contact your AM, they will give you the network wide conversion rate. Your actual CR will of course be lower but it's atleast a metric to start with.
 
Setec said:
The discussion of math is all well and good, but it doesn't really answer my original question, because it all hinges on knowing your conversion rate (or knowing what to expect it to be). So my question really is equivalent to asking what conversion rate is safe to assume when you're just starting a new campaign with no data. Chrislingle's 2% figure seems to answer that, although if I'm bidding to break even on a 2% conversion a lot of my offers will still get 0 traffic.
Click to expand...

Again what kind of offers are you promoting? email submits can convert at 35% while ringtones 5-10% and mortgage 1-2%. There are industry averages but no one can help you if you cant give us an idea of the category youre in. Best advice is to talk to your AM like someone said, then verify what they said with another AM at another network. Some people like to inflate numbers to get you to push it so ask around.
 
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