Learning to Evaluate CPA Offers

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DonBerto

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Oct 22, 2006
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Do you guys have a rule of thumb for evaluating different CPA offers if the sole traffic is PPC?

I've been testing different offers and by luck have had moderate success for a CPA newb (i.e. breaking even). However, the offer is rather involved. Better said, it's a long form with multiple steps.

What about short form offers requiring only zip and email? I'm evaluating an offer where the average PPC bid is 1/4 to 1/3 the payout.

So, basically one would need a 40% conversion rate to break even or there abouts.

Lots of variables, but it seems possible, right?

For others starting out with CPA and PPC traffic, I got slammed the first couple days on with my initial attempt and started freeking. After about 3 days of monitoring competitors and tweaking bids right below them, things have started to level off some and I'm breaking even. It took almost $400 to get to this point. It's been 4 days now and it looks like things are turning positive.

My recommendation for other newbs is to look at how others are bidding and their position. Unless they're newbs too, they're not in it to lose money.
 


My experience is that I'm a poor judge of what is going to perform well. So I just try everything and apply a simple formula on how much to bid on the keywords regardless of what everyone else in the space is doing. Seems like offers that are successful fall into one of two categories for me. Those that convert at 1:20 and those that convert 1:10.

Knowing this I figure out what ROI I need to be happy. For me I need to double my PPC money, anything less is just not worth it. With this it's just a numbers game.

Using an estimated conversion ratio of 20:

CPA divided by 20 = breakeven

Breakeven / 2 = My cpc amount

Since I have no idea how the offer is going to convert or how much traffic I'll get, I'll run the above for a couple days. If very little traffic, I'll run the same formula with 10 instead of 20 or whatever I figure the conversion ratio is. Additionally you can get the true conversion ratio from your AM instead of guess. The above has just been a rule of thumb for me.

If I still can't rank with my keywords and I have exploited all the long tails I can think of, no big deal I just move on to the next offer, there are thousands.
 
You have to test. I have not been doing the affiliate marketing that long, but I have gotten much better at spotting what is likely going to work how it will work, where it will work and at potentially what price it will work. That being said, I am probably still wrong as often as I am right and have to tweak things.

If I had $1000.00 for every offer I thought was a sure-fire slam dunk that delievered nothing I would be very rich off that alone. Once I find something that works though, I figure out how to maximize it and exploit it in as many ways as possible. Sometimes I will revist offers when I have new ideas to try and promote them as well.

It can't be said enough, but you really just have to test, test, test and test some more. Collect and monitor as much data as possible so you have a complete picture of what is going on and can react accordingly.

For example early on I thought the e-mail/zip-code stuff was so easy that it was impossible to not make it work. Not so fast. They are all over the place, they get scrubbed like crazy and can be a lot of work to get converting via PPC for the right price. Doesn't mean it can't work, or doesn't work, it just means it is not nearly as easy as you might think when you first look at an offer like that.
 
Rob_TID said:
What do you mean "scrubbed like crazy"?
Click to expand...

Someone else feel free to correct me, as I am a relative newbie to affiliate marketing. My understanding is that they check their lists against previous sign-ups and whatever other criteria they have and kick out leads they don't like or are duplicates. So if someone is already in their database and they sign-up again through you, it does not count. I don't know how it works for multiple products and the like, I just know that some affiliate programs scrub their leads and this ultimately means less money for us. :)

As for judging saturation. Competition can be a good starting point. Of course no competition can also be a sign of a bad offer. However, if you see a lot of people competing on the core keywords, you can guess that it is something that is working for some people. Then you need to figure out how to work your way into the game. Beyond that some segments you just know are crowded because they get a lot of buzz about them. Ringtones, Dating etc. The most important thing for me is if I can come up with a concept for keywords that makes sense. That is really the key. Figuring out how to get your keywords. If you got a product and you have no clear idea on what keywords to target with it, probably not even worth testing. Expanding on that, what I mean is you need an angle that not everyone else is taking. Shoemoney always mentioned when he got into Ringtones how he went out and made a list of all the artists and songs. That is the kind of foundation that is really helpful for making a campaign work. You have to find that associated set of keywords that will give you a lot of exposure for a lower price.
 
Best way to learn to evaluate is just try them. You need to get a feel for what works best for you. Given time you'll start to get a good feel for what will work and what won't.. based on your expenses, traffic source, etc. Just based off of my knowledge of conversions I know what stuff will be a total disaster, but I can't always just look at an offer or rough ad cost estimates and know if it will be profitable or not.
 
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