Table of Contents
- Paid Advertising Overview
- PPC Basics
- PPC Rules of Engagement
- Top PPC Advertising Options
- Private Banner Ads
- Affiliate Marketing
Like we discussed back in Chapter 7, paid advertising is the #1 way to drive traffic to your site in the first 2-3 months after launch. Do you have to use paid advertising? No. If you'd prefer not to spend any money on advertising, you don't have to. But I highly recommend that you try it out to see if it's profitable in your niche. Here's the thing... You don't have to "mortgage the farm" to try it out. It's not at all like "real-world" marketing where you have to spend (tens of) thousands of dollars to create a TV/radio/magazine spot that will air for a few weeks, all in the hopes that it generates enough business to pay for itself. We're talking about "risking" maybe $40-50 here (maybe $100 if you want to get "crazy"). If you haven't made any sales by then, you can always stop the ad campaigns and throw in the towel on paid advertising. But I'd strongly recommend giving it a try, as paid advertising can contribute significantly to your bottom line.
The really cool thing about paid advertising is that it can help you drive traffic and start generating sales DAY 1 after you launch your store. Getting ranked takes several weeks (sometimes months) to pay off and start bringing in free, organic traffic. In the meantime, you can start making money immediately with some well-crafted paid advertising campaigns. A word of warning, though... If you don't follow the principles and techniques I'll teach you here in Chapter 8, it's possible to accidentally spend A LOT of money very quickly... and not generate a single sale from it! The world of paid advertising is not kind to the uninformed. Please make sure to go through ALL of the Chapter 8 training (including all expandable sections and Pro's Edge boxes) before you begin doing paid advertising. One other word of caution... Be careful not to allow yourself to get caught in the "pay per click time trap", as I call it, where you spend ALL your time creating PPC ads, processing minimal-profit orders, analyzing your ads, tweaking your ads, processing more low-profit orders, analyzing and tweaking your ads some more, and so on. Don't become so busy that you fail to work on getting ranked! Always remember that a sale placed by a free visitor yields more profit than a sale placed by a paid visitor.
3 Main Types of Paid Advertising on the WebThere are 3 main categories of online paid advertising opportunities...
- Pay Per Click (PPC) - You pay a set amount each time someone clicks on your ad and comes to your site. (Note: I'm grouping Pay Per Impression (PPI) ads into this category since they're so similar. With PPI ads, you pay a set amount for every 1,000 times your ad is displayed on a page, regardless of how many times the ad is actually clicked.)
- Private Banner Ads - You pay a set monthly fee to have your banner ad displayed on (a) certain page(s) on someone else's website (number of impressions and number of clicks are irrelevant).
- Affiliate marketing - You pay your affiliates (i.e. those promoting your store/products) a set percentage for every lead they send to your site who ends up placing an order.
All 3 types of paid advertising are viable options you should take the time to explore, but PPC advertising is by far the biggest and most prevalent (and what we'll primarily focus on). We'd recommend starting with PPC and look into expanding into paid banner ads and/or setting up an affiliate program later down the road.
Pay-Per-Click (PPC) Advertising Basics
Most of you are probably pretty familiar with how Pay-Per-Click (PPC) advertising works, but let me quickly provide an overview for those who aren't (or for those who need a little "refresher"). I'll use a standard "search ad" as an example, although we'll talk later about the fact that there are a few different types of PPC ads.
1. You create your PPC ad, specifying...
- the ad's headline text,
- the ad's body content (i.e. sub-text),
- the URL to be displayed on the ad (i.e. display URL),
- the URL of the page customers will "land on" when they click the ad (i.e. the landing page),
- the exact search phrase(s) a searcher must search for in order for your ad to be displayed, and
- the maximum bid amount you're willing to pay for each click (i.e. max bid amount).
2. Your ad is displayed on a search results page when someone search for one of the specific phrases you listed when you created your ad. The higher your max bid amount (relative to the other sites bidding on the same search phrase), the higher up your ad will appear on the page, giving it more exposure and increasing the likelihood it will be noticed. Note: With PPC advertising, you don't pay anything just for having your ad displayed on the page (which is called an "impression").
3. When a searcher clicks on your ad, you pay for the click (up to the max bid amount you chose when you created the ad, although you'll oftentimes pay a lower amount). The searcher is taken to the landing page you specified, and they hopefully go on to make a purchase. But whether they place an order or not, you still pay for the click. You can see how it's really just a numbers game. Since you're paying for every click (i.e. every visitor), the name of the game is generating a sale (i.e. a "conversion") with as few of clicks as possible. If you're able to generate a sale that yields, say, $60 of profit every 50 clicks that cost, say, 50 cents per click, you're only spending $25 on paid advertising (50 clicks @ $0.50 per click) in order to generate $60 of profit. Success! You netted $35. :)
Important PPC Terminology & a Simple Example
Here are a few PPC terms you should be familiar with...
- Maximum Bid - The maximum amount you agree to pay for each click. (Depending on how much other advertisers have bid, you won't always pay the full max bid amount. You'll usually end up paying a good 80% or more of the max bid amount, though, and oftentimes close to 100% of it.)
- Impressions - The number of times your ad was displayed on a page viewed by a potential customer (i.e. a Google search results page). This tells you how many times your ad could have been clicked (realistically, though, a fairly low percentage of people will actually notice it and read it).
- Clicks - The number of times a potential customer actually clicked on your ad and was therefore navigated to your site.
- Click-Through Rate (CTR) - The percentage of impressions (i.e. views) that resulted in clicks (i.e. visitors). This tells you what percentage of people who saw your ad (assuming they even notice it on the page) actually clicked on it.
- Conversions - The number of actual sales that resulted from your PPC advertising campaign.
- Cost Per Conversion - The amount of money you had to spend, on average, in order to generate 1 sale (i.e. 1 conversion).
- PPC bid = $0.50
- Impressions = 1,000
- Clicks = 40
- Click-Through Rate (CTR) = 4.00% (40 clicks / 1,000 impressions)
- Conversions = 1
- Cost Per Conversion = $20.00 (40 clicks @ $0.50 per click / 1 conversion)
The bottom line here is that you spent $20 on PPC ads in order to generate 1 sale. Was the ad worthwhile? Did it pay for itself? It depends on how much profit you make on the average order! If you make well over $20 per order, it was definitely worthwhile! If you make right around $20 per order, it was kind of a pointless exercise as you went to a lot of trouble to merely break even. If you make less than $20 per order, you lost money (you spent more in paid advertising than you made from the sale)! We'll talk about all of this more later, but hopefully you can already see why I like to say that "Cost Per Conversion is KING!"
3 "Varieties" of PPC Ads
Within the realm of PPC advertising, there are 3 main "varieties" of ads.
1. Search Ads. In my example above, I've described the 1st type of PPC ads: textual search ads. With search ads, you create your textual ad (specifying the headline, ad body and URL) and then you specify when you want your ad to appear (i.e. the specific search phrases they must search for). Your textual search ad will only be shown when somebody searches (hence the name) for one of the search phrases you've listed. Note: Facebook, Reddit and other sites use the same basic concept for their PPC advertising engines, but other parameters besides search phrases are used to determine when your ads are displayed. But I'm still going to categorize them as "search ads" since they are based on the same general concept of 1) building your ad, and 2) specifying the conditions for when that ad is displayed.
2. Display Ads. The 2nd type of PPC ad is a display ad. Display ads are graphical image ads, also known as banner ads. A few examples include a 250x250 square ad, a 728x90 wide ad, a 160x600 tall ad, and so on. Setting up display ads is quite similar to setting up search ads, but there are a couple key differences. First off, you're obviously uploading an image rather than entering the text of your ad. (You will of course still specifying the landing page URL the ad will take people to when they click the ad.) The other key difference has to do with where your ads are displayed. They don't show up on SERPs (search engine results pages) like search ads do. Display ads are displayed on privately owned websites across the web who have opted to show ads on their sites (to earn money). How does the PPC engine (i.e. Google AdWords, for example) decide which websites to display your ad on? When you set up your display ad campaign, you provide a list of keyword phrases that your ad relates to (similar to what you do when you create a search ad). But in this case, Google takes the keyword list you've provided and uses it to identify "relevant" websites (i.e. sites that are about the same thing, based on the titles/tags/content on the page).
3. Product Ads. The 3rd type of PPC ads, product ads, are driven by a "product feed file" that you upload to the PPC engine. So rather than setting up individual ads, you simply upload a feed file containing your key product details (i.e. title, price, image URL, description, etc.) for each of your products. Then it's up to the PPC engine to decide when and where to display your product-based ads. In a few minutes here, I'll provide a list of the best PPC portals for each of these 3 varieties of PPC ads. For now, I just want you to understand that there are 3 different types of ads just within the Pay-Per-Click category (which is just 1 of 3 types of paid advertising). I know, I know... there's a lot to learn and keep track of. But that's what we're here for! ;) And just remember, the core concept is the same for all 3 types of PPC ads: 1) you create the PPC ad, 2) the ad is shown to at least semi-relevant web surfers/shoppers, and 3) you pay a set amount (of your choosing) each time someone clicks on the ad, which brings them to your site.
PPC Rules of Engagement
Over the past few years we've spent coaching and mentoring online store owners, we've heard some variation of this sad tale way too many times...
Then there's this recurring story, too...
Have you heard stories like these? Have you been unfortunate enough to experience either of these scenarios yourself? :( PPC advertising can be a great way to drive targeted traffic to your site. But if you don't know some of the crucial rules of the game, it can be 1) very expensive and 2) very ineffective... NOT a good combination! Here in this section, I'll go over my "Big 4" rules of engagement for PPC advertising. My advice is to not even attempt PPC marketing until you've read everything in this section (including the expandable sections and Pro's Edge boxes). So without further ado, let's jump in...
Rule #1. Know Your Maximum Cost Per Conversion Before You Begin
Suppose you were part of a marketing team for a corporation and you were presenting a marketing pitch to the CEO. When the CEO asked you how much the marketing campaign would cost and how many sales you expected it to generate and how much net profit that would result in, what if your answered, "I have no idea"? Do you think that would go over very well?! Do you think you'd even still have a job at the end of the day? ;) This scenario sounds ludicrous, but based on our experience coaching thousands of web store owners over the years, "I have no idea" is the answer the majority of store owners would have to give if they were being honest. They have no idea how much money they're willing to spend on the PPC ads. They have no idea how many orders they expect the ads to generate. And they have no idea how much profit the sales they're hoping to get will result in. All they know is that they want to make sales, that you need customers to make sales, and that PPC ads can send those customers. But you simply cannot go into PPC advertising blindly like this. You've got to know EXACTLY how much money you're willing to spend on PPC ads in order to generate 1 sale. In other words, you've got to know your Maximum Cost Per Conversion.
How to Calculate Your Maximum Cost Per Conversion
As we've discussed, the first thing you should do (before you even set up your first PPC ad campaign) is determine your Maximum Cost Per Conversion. Basically, this number tells you the maximum amount you can spend to generate 1 sale. It puts a cap on what your ACTUAL Cost Per Conversion can be before you should "pull the plug" on the ad group or ad campaign.The formula for calculating your Maximum Cost Per Conversion is simple...
MAXIMUM COST PER CONVERSION = [Average Profit Per Order] - [Minimum Amount You're Willing to Make Per Order]
Average Profit Per OrderYou start with your average PROFIT per order. How much money do you truly pocket on the average order after all direct costs associated with the order? Basically, this is going to be revenue you collect on the sale (including shipping revenue, if applicable) minus all the costs you incur that you otherwise wouldn't have incurred had you not made the sale. These costs would include:
- The wholesale price of the product
- Shipping expenses you incur (whether charged by your supplier or incurred separately)
- Dropship fees (if any)
- Transactional merchant fees (only those fees related to processing this transaction)
You should NOT include paid advertising costs or your store's "fixed costs" that are incurred regardless of how many sales you make each month. Again, you should only include costs that you wouldn't have incurred if you hadn't of made this sale. Also, since you'll be deducting the "labor cost" for processing the order (whether it's a value for your time or whether it's an actual cost paid to an employee), do not include that cost in the 'Average Profit Per Order' component. You'll need to use averages for these calculations, since some orders are obviously more profitable than others. The best way to compute your average profit per order is to look at historical earnings for the past ~3-month period. (If historical data isn't available because your store is brand new, you'll have to make some educated guesses.) You can calculate the average profit per order on a store-wide basis, category or product-type basis, or even on a product-by-product basis. It depends on how targeted (specific) your PPC ads are. You should know the net-profit-per-sale figure for each unique ad group you create. So if you have an ad group that sends customers to a particular sub-category page on your site, you should know how much net profit you make (on average) for products within that sub-category. If you have an ad group that sends customers to a specific product page, you need to know how much net profit you make on that specific product.
Minimum Amount You're Willing to Make Per OrderOnce you know your average profit per order, you simply need to subtract an amount to compensate you for your time & effort to process the order. Why subtract anything from profit per order? Well, because I'm guessing you don't want to work for nothing, right?! :) If you spend as much money on PPC ads as you profit on the average sale, you're doing a whole lot of work for zero profit (or, if you're paying an employee to process orders for you, you'd be losing money)! Subtracting an amount for the value of your time (or an employee's time) ensures that you're not working for nothing! If you process orders yourself, you'll just want to make up this amount based on how long it takes you to process an order & how much value you place on your time. If you have an employee/staff member who processes orders for you, you can base this amount on his/her hourly rate. Make sure to consider all time spent dealing with orders: before the sale (answering questions via email, live chat or phone), at the time of the sale (checking stock status, processing the order, etc.), and after the sale (sending tracking information, dealing with follow-up questions and issues, dealing with occasional refunds/exchanges, etc.). Ask yourself these questions...
- On average, what's the total time you spend dealing with an order?
- How much do you value your time ($10 per hour, $20 per hour, $50 per hour)?
Multiply the time spent dealing with a typical order by the hourly rate you put on your time (or your employee's time). This will tell you how much to subtract from the average profit per order in order to yield your Maximum Cost Per Conversion.
As a simple example, let's say that for a particular category of products, you made 30 orders over the past 3 months and generated a total of $1,800 in profit. That's an average profit per order of $60 ($1,800 / 30 orders). And let's say that you estimate it takes you ~30 minutes (including pre-sale inquiries, fulfilling the order and post-sale follow-up) to fulfill an order and that you value your time at $20 per hour. Your Maximum Cost Per Conversion for this particular category of products is $50.00 ($60 average profit - (0.5 hours x $20 per hour)).
Pro's Edge: How to Use 'Maximum Cost Per Conversion'
What Does Maximum Cost Per Conversion Represent?
Maximum Cost Per Conversion is the ceiling amount (i.e. the maximum, or cap) on how much you're willing to spend in order to generate 1 sale (for a particular ad group). So in the example in the expandable section above about how to calculate Maximum Cost Per Conversion, we decided you'd be willing to spend as much as $50 (the less, the better, of course) in order to generate 1 sale, but no more. Even though you actually make $60 profit on the average order (actual dollars in), you're only willing to spend $50 on PPC ads to generate a sale because you need to net at least $10 in order for it to be worth your time. Now that you've calculated your Maximum Cost Per Conversion, you can always compare it to your ACTUAL Cost Per Conversion to see if a particular PPC ad is worthwhile...
- If Actual CPC < Maximum CPC, the ad is worthwhile and profitable
- If Actual CPC = Maximum CPC, the ad is worthwhile but just barely (it's only compensating your for your time)
- If Actual CPC > Maximum CPC, the ad is costing you more than it's worth!
Example of How to Use Cost Per Conversion
To illustrate, let's say that you start a PPC campaign, let it run for a couple weeks, and then calculate that your actual Cost Per Conversion is $50, meaning that you spent $50 (actual dollars out) in PPC costs to make each sale. Compare actual dollars in ($60) to actual dollars out ($50). So after paying for the PPC ads, you walk away with $10 of in your pocket. Was it worth it? Yes, but just barely! Remember, $10 was exactly how much you decided you needed to make for it to be worth your time and effort to process the order. What if your actual Cost Per Conversion was $55? You'd still walk away with $5 in your pocket after PPC costs ($60 average profit per order - $55 PPC costs), so the PPC campaign is worthwhile, right? No, it's not! While it's true that the sale generated through PPC added $5 to your bottom line, it wasn't worth your time. You made money, but not enough money to keep you from doing more worthwhile things with your time (business or otherwise). As long as your actual Cost Per Conversion stays at or below $50, you should continue running the ad campaign or ad group. The lower the actual Cost Per Conversion, the more profitable the campaign. But if your actual Cost Per Conversion goes above your $50 Maximum Cost Per Conversion, you should discontinue (or modify) the ad campaign or ad group. Maximum Cost Per Conversion should always be your "measuring stick" to verify whether any given ad campaign or ad group is worth continuing.
Cost Per Conversion is King!
I like to say that Cost Per Conversion is "king" because it is the key number that should drive everything you do with regard to paid advertising. Cost Per Conversion determines whether your paid advertising campaigns are profitable and to what extent. It is the key indicator that tells you whether you should even continue on with a particular ad campaign or ad group. And it helps you decide whether to expand your paid advertising efforts (which we'll discuss soon). Cost Per Conversion drives everything! A lot of people get caught up with all the different numbers and statistics for their paid advertising campaign. They obsess over how to increase their Click-Through-Rate, or how to get more impressions, or how to bring down their average PPC bid. Now, we're not saying that those things are unimportant (because they are). But always remember that Cost Per Conversion is KING! It is the "bottom line" that you should always keep in the forefront of your mind. If your Cost Per Conversion is too high, it doesn't matter how many impressions you get, how high your CTR is, or what your average PPC bid is. The only way to turn a good profit with paid advertising is to control your Cost Per Conversion.
Pro's Edge: Biggest Factors that Affect Cost Per Conversion
There are all kinds of factors that impact Cost Per Conversion. Let's focus on the main 3...
1. The search phrases your ad targets - The most important factor is which search phrases you've chosen to have your ad appear. Generally, the more specific and targeted the search phrase, the lower your Cost Per Conversion will be (which is good). Search phrases that include a brand name, a buying word (such as discount, cheap, or for sale), and/or descriptor words (size, color, material, style, etc.) demonstrate a higher intent to buy, which will result in more sales and a lower Cost Per Conversion. For example, if you sell PetSafe brand dog houses, your Cost Per Conversion will be lower if you target phrases like 'discount dog houses', 'dog houses for large dogs' and 'PetSafe dog houses' than it will be if you target broad, generic phrases like 'dogs', 'dog' or even 'dog houses'.
2. How well the ad's landing page matches the ad - When you set up your ad, you specify which page of your site people who click on your ad will "land on" (i.e. the "landing page"). It is very important that they are taken to a page that makes sense and closely matches the content of your ad. If they searched for 'dog houses for large dogs' and clicked on your ad that talks all about large dog houses, the ad should take them to a 'Large Dog Houses' category page or possibly even a product page within that category. If the ad takes them to your home page, which shows a wide variety of dog houses of all types and sizes, you are bound to make fewer sales and will therefore have a higher Cost Per Conversion.
3. Your average PPC bid - Obviously, the less you pay per click, the lower your Cost Per Conversion will be. If you're paying $0.25 per click, your Cost Per Conversion will be half of what it will be if you're paying $0.50 per click. While it's clearly good to pay less per click, a lower PPC bid will also mean you get less exposure and fewer clicks. Google (and all the other PPC programs) place the highest bidder's ads at the top. So a low PPC bid will result in your ad being further down on the page (or even pushed to page 2 or 3, where it will hardly ever get clicked). So while you want a low PPC bid for Cost Per Conversion purposes, you need to bid high enough that your ad actually gets seen and clicked on.
Rule #2. Start Small & Scale Up Slowly
Last year, a friend of mine got a new job in a neighboring state. He thought he'd love the new job and be there for a long time (maybe for the rest of his career), but he of course had no way of knowing for sure whether everything would pan out. Rather than selling his home here in Idaho and immediately buying a new home in Nevada, he was smart enough to hold off for a few months. So he just rented out his home here and rented a home there in Nevada to make sure everything turned out as planned. Well, it just so happens that things DIDN'T turn out! He ended up hating the new job, and within a few months they moved back to their home in Idaho. Now, what if he had sold his home here in Idaho and purchased a home in Nevada? He would have lost A TON of money in closing costs and real estate fees, not to mention the hassle of buying and selling two homes! My friend is glad he was smart enough to take things slow and not go "all in" right out of the gate. Similarly, you should "ease into" PPC advertising. Whether you do it intentionally or unintentionally (and it's oftentimes unintentional), you should never charge into PPC advertising. You should start small and scale up slowly.
Starting SmallWhat do I mean by "starting small"? You should start out by only advertising for very specific, very targeted search phrases. For example, if you're selling dog houses, you shouldn't set up your first ad campaign to show up for searches like "dog" or even "dog houses". These phrases are quite broad and get A LOT of daily searches, which could very easily result in A LOT of clicks. This means you could spend A LOT of money overnight and, because the ads are not very targeted, also not make any sales from the ads. In virtually every horror story we've heard about people accidentally spending hundreds of dollars in a single day, they didn't follow this rule about starting small. Your first ad group should target specific, long-tail search phrases that include one or more of the following:
- a brand name
- a product name or model number
- descriptive words (size, material, functionality, other adjectives
- "buying words" (i.e. for sale, discount, cheap, on sale, etc.)
For our dog houses example, your first ad group might target phrases like these: "large dog houses", "insulated dog houses", "dog houses for sale", "[brand name] dog houses", "wooden dog houses", and so on. These search phrases won't get nearly as many searches as broad, generic phrases like "dog" or "dog houses", but they're much more targeted and therefore should have a higher conversion rate (since descriptive, long-tail phrases demonstrate that the searcher is in "buying mode"). Plus, as an added bonus, you won't run the risk of racking up a huge bill overnight. :)
Pro's Edge: 2 More Tips to Avoid Accidentally Spending $500 Overnight!
I mentioned above that sometimes people unintentionally start out too big and too broad. This happens when they're not careful about how they set up their ads. Tip #1. At the step where you enter all the search phrases you want your ad to appear for, always be sure to put the search phrases inside [brackets], as I've shown here. This tells Google (and most of the other PPC engines work the same way) that you only want your ad to be displayed when someone searches for that EXACT PHRASE. If you don't put the phrases inside brackets, you're giving Google permission to show your ads for any and all phrases Google thinks are "related" to the phrases you provided. Do you see how dangerous this can be?! Google may show your ad for all kinds of "related" phrases that have nothing to do with your products and that are going to have an extremely low (or non-existent) conversion rate! This is how you spend $500 overnight and make no sales! So always make sure to enter the search phrases within [brackets]. Tip #2. Google and most of the other PPC engines allow you to set a daily spend limit for your account, both for an individual ad campaign and for all campaigns collectively in your account. Honestly, you should always utilize these fields, even if you're experienced with PPC marketing. But it's absolutely critical that you set daily spend limits in your account if you're just getting into PPC marketing and aren't 100% familiar with how the ad management interface works. It's a nice "safety net" in case you don't set everything up right.
Scaling Up Slowly
If you follow the first part of this rule about starting small (and you better! :) ), you'll be starting out with specific, targeted search phrases that likely don't get a whole lot of daily searches (and therefore won't result in a whole lot of clicks or traffic to your site). Just because you start out small doesn't mean that you have to restrict yourself to these low-volume search phrases forever! Over time, you can and should scale up. But you should scale up slowly and methodically. You're not going to want to go from "insulated dog houses for sale" to "dog" in one step! ;) The Maximum Cost Per Conversion you calculated for Rule #1 will play a key role in how much you'll expand (or whether you'll expand at all). The Pro's Edge box below will walk you through the process you should use to scale up your PPC campaigns.
Pro's Edge: How to Methodically Scale Up Your PPC Ad Campaigns Over Time
As we've discussed, your first ad group should be extremely specific and targeted. It won't result in all that many clicks, but the clicks you do get should be high-quality traffic that is quite likely to convert. After running this first highly-targeted ad group for a few weeks, you'll need to check to see how your actual cost per conversion compares to your Maximum Cost Per Conversion. If your actual CPC is equal to your maximum CPC (or close to it), you won't want to scale up at all. But if actual CPC is less than maximum CPC (which will hopefully be the case), you should create a new ad group that targets slightly more broad and generic keyword phrases. Then, after a couple/few more weeks, you'll analyze the performance of this new ad group, again comparing its actual CPC to your maximum CPC. If the actual CPC is less than maximum CPC for this new, slightly broader ad group, you'll scale up again to slightly more generic search phrases. You'll continue this pattern over and over again until it doesn't make sense to scale up any further (i.e. when actual CPC = maximum CPC for your broadest, most generic ad group).
Rule #3. Create Targeted, Compelling AdsThere's a lot more to creating a good PPC ad than using "buzz words" meant to grab searchers' attention. Of course, you want your ads to STAND OUT and get clicked on, but you're just flushing money down the toilet if those clicks don't result in sales. That's why it's so important for your ads to be targeted. It is absolutely critical that these 3 things are 100% aligned with each other:
- the search phrase the potential customer searched for,
- the content of the ad (including the headline, the body and the display URL), and
- the landing page the ad takes the potential customer to when they click on the ad.
- The potential customer searched for "wooden dog houses".
- Your ad has the exact phrase "wooden dog houses" 3 times (once in the headline, again in the body and a third time in the display URL).
- When she clicks on it, it takes her directly to your "wooden dog houses" category page.
The ad makes it clear that you're selling exactly what she wants. And then, when she lands on your site, she's taken directly to a page that lists exactly what she's interested in (and no more). Simple but powerful! Whatever you do, please don't waste your money sending hordes of people to your home page to try to figure out how to get to where they actually wanted to go! :)
2 Inseparable Goals
When it comes to PPC advertising, there are 2 goals, which are inseparable. Goal #1 is to get your ad noticed and clicked on. Goal #2 is to have the people who click on the ad actually place an order. Achieving goal #1 is pointless - and actually harmful to your business - if you're not also achieving goal #2. It just means that you're needlessly spending lots of money to get visitors who don't end up buying anything! Always keep in mind that the goal is NOT just to get clicks... but to get orders from those clicks!As we just discussed, the #1 most important thing to remember when creating your ads is to make sure that all 3 of these things match each other:
- the search phrase the person typed into Google,
- the headline and content of your ad, and
- the landing page on your site that the ad links to.
I'm a broken record, I know. But think about this concept in terms of our 2 inseparable goals of getting clicks and making sales. If #2 (your ad headline/content) doesn't closely match #1 (what the person searched for), your ads will rarely get noticed or clicked on. And if #3 (the landing page on your site) doesn't closely match #1 (what the person searched for), those who click on your ads (costing you money!) will almost never end up placing an order on your site. Accomplishing goal #1 (getting people to click on your ads) but not goal #2 (getting those visitors to place an order) is just wasting your money! It seems like such a "DUH!" concept, but we're constantly amazed to see people use the same exact ad for ALL of the search phrases they're doing PPC advertising for even though the search phrases differ substantially. And we're even more surprised to see people send all their PPC visitors to their home page instead of sending them to a more relevant, targeted page (such as a brand page, category page, or even a product page) that matches what they searched for. Unless you have an ultra-nichey store with very few products/varieties, very rarely will you want to send visitors to your home page.
Pro's Edge: Creating Ads that Stand Out & Get Clicked!
As we just discussed, the #1 most important thing to remember when you create PPC ads is to make sure the 1) search phrase the person searched for, 2) ad headline and content and 3) landing page the ad takes the person to are perfectly aligned (i.e. they all need to match). But in addition to that, there are many other things you can do to make your ad JUMP OUT at searchers and entice them to click on it. This section presents some ideas you should try in your A/B split testing.
The first words in your headline should be the exact search phrase the searcher entered (or as similar to it as possible). If you can't fit the entire phrase, include as much of it as you can (leaving out less important words). If you have room, include a short "buzz word" (see below) after the keyword phrase.
Even though the headline contains the search phrase, you should include it again in the body of the ad (i.e. the entire search phrase). It may seem redundant, but the best way to appeal to potential customers is to make it obvious that you have exactly what they want! Besides the search phrase, try to throw in a few "buzz words" as well. See the list of example "buzz words" below.
The 'Display URL' is the URL text you want searchers to see. It does NOT have to match the actual URL of the page they'll be sent to (i.e. the landing page) if they click on your ad. However, the display URL does have to contain your domain name, which usually limits the amount of characters you have to work with. Optimally, it would be best to enter the following as your display URL: EntireSearchPhrase.YourDomain.com In reality, you will rarely have enough space to do this. So we recommend putting as much of the keyword phrase as possible (using the most important words within the search phrase) before the period and the domain name. For example, if your ad was targeting 'Apex' brand dog houses, you might enter the following display URL: Apex.YourDomain.com This at least helps customers know that they'll be taken to a page with Apex brand dog houses on it, even though the display URL doesn't contain the entire search phrase they entered. If they've already seen the exact search phrase they entered in both the headline and body of the ad, customers will already know they're looking at a targeted, relevant ad anyway. You may also try out including a "buzz word" in the display URL, either in addition to or even instead of the search phrase. For example, you might try using the following as your display URL:
Buzz words are designed to:
- Draw searchers' attention
- Pique their curiosity
- Create a sense of urgency, and
- Call them to action
Following is a list of various buzz words you may want to try out in a) your headline, b) ad content, or c) display URL:
- free shipping
- ships free
- fast shipping
- same-day shipping
- XX% off
- best prices
- lowest prices (guaranteed)
- today (only)
- this week (only)
- limited time (only)
- shop here
- check out...
You may also consider including your toll-free number in the ad content. Also, if your ad is product-specific, you may try putting the price of the product right into the ad content. These are all just ideas you may want to try out in your A/B split testing. Some work better than others in certain markets. There's no magic formula that will always work the best for everyone.
Rule #4. Use A/B Split Testing to Improve Your Ads Over Time
In professional sports, how do we crown a champion? Do we just choose who we think the best team is at the end of the regular season? Of course not! Virtually all professional sports have some kind of playoffs after the regular season to determine the champion. (Even college football has FINALLY started to figure this out! :D ) In most sports, there are several elimination rounds where the winners of the previous rounds continue to face each other until only one team is left standing.
You should approach your PPC ads the same way. Don't just throw an ad up and hope it's as good as it's going to get! :) It sounds stupid, but it's what a lot of people do! Google and the other PPC engines make it easy to do a form of A/B split testing to run 2 "versions" of the same ad side by side at the same time. You let them run simultaneously for a couple/few weeks (long enough to get a decent sample size), and then you analyze them to see which one performed better (both in terms of click-through rate and, more importantly, in terms of cost per conversion). You declare that version the winner and immediately introduce a new challenger (aka a new version of the ad). Those 2 ad versions will then run side by side until you analyze again and declare a new winner. You continue to repeat this process over and over again until you've found a winner no challenger is able to beat. In addition to the changes you make to the content of the ad itself, remember that adjusting the max bid amount (up or down) can make a big difference in your click-through rate and your ad's performance. So make sure to include the max bid amount as one of the "variables" you play with in your A/B split testing.
Pro's Edge: Tip for Cutting Your AdWords Cost in Half
This simple trick will save you 50% to 80% on your AdWords campaigns, and I am NOT exaggerating! This is 100% legit and unbelievably simple! It works in at least 80% to 90% of markets, and very few people even know about it. Best of all, this tip is in no way against Google AdWords Terms of Service - so you are NOT at risk of getting banned or suspended by utilizing this cool tip! This tip is so vital for people that are just launching their online store, simply because until you get ranked you almost have no choice but to do paid advertising to bring targeted traffic. If you can drive the same number of visitors and sales at 20%-50% of the price you are going to be far more profitable. It's extra important when you take into consideration the fact that Google AdWords is almost always the #1 source for paid traffic, and that goes for almost every niche you can think of! I always say that if you can be profitable with Google AdWords, you can be profitable in almost any PPC advertising venue out there! Okay, here's the little-known AdWords trick... VERY RARELY do you have to pay anywhere close to as much per bid as Google indicates! This is going to sound insanely simple, but here is the tip that will save you 50-80% on your spending: Start with a maximum bid that's far below what Google suggests! How low? I'm talking a bid of $0.20 to $0.30 to start off with! Google will give a warning message that says the bid is far below the amount needed to show up on page 1, but ignore it and check back 12-24 hours later! At the time I'm writing this tutorial, we have an AdWords campaign going for one of our stores that we are bidding $0.18 per click, and we're averaging position #2! When we first set up the campaign, we got a warning that said we had to bid $1.50 to show up on page 1!
Top PPC Advertising Options
Alright, gang, now that we’ve gone over my "Big 4" rules of engagement for jumping into the world of PPC advertising, it’s time for you to dive in and get started. Like I’ve mentioned a couple times now, you don’t need to risk a lot of money here to test it out and see whether it will be profitable in your niche. So the big question you’re probably asking yourself is: "Where do I start?" As you’re probably aware, there are A LOT of PPC advertising options out there. Let's discuss a handful of your best options.
Google PPC Advertising Options
Google is the most popular search engine on the planet and therefore has the potential to bring you the most traffic. That’s why we focus on Google for getting ranked organically and why I’m also listing Google as the #1 PPC advertising option. Remember back in the PPC Basics section when we talked about the 3 different "varieties" of PPC ads (1. textual search ads, 2. graphical display ads and 3. feed-generated product ads)? Google actually offers ALL 3 TYPES of PPC ads (and multiple options for a couple of them). Here’s a quick overview of the main 3 PPC platforms offered by Google…
1. Google Product Listing Ads (PLAs). These are product-specific ads (which show a product image, product title and the price) that appear down the right side of many Google search results pages as well as in Google Shopping. PLAs are driven by a product feed file that you upload to Google Merchant Center. Basically, you upload a spreadsheet containing key information about each of your products (i.e. title, image URL, price, product description, etc.), and then Google decides where and when to show your PLAs. If you’ve been going through Store Coach training course sequentially, you likely already set up PLAs back in Chapter 6 as part of the Store Launch Sequence. If you haven’t, jump back to the Set Up Google Products section of that chapter now for a step-by-step guide on how to set up PLAs.
2. Google AdWords Search Network. These are the textual ads that appear at the top (and sometimes also at the bottom) of most Google search results pages. (If you go to Google.com and do a search for practically any product type, you’ll see these textual ads (they don’t include images) at the top of the page.) This is the "traditional" type of PPC ad where you specify what you want your ad to look like (i.e. the headline text, ad body and display URL) and when you want it to show up (i.e. what search phrase(s) the person searching Google had to have searched for). You create AdWords Search Network ads through Google AdWords. (Note: In addition to Google.com search pages, AdWords Search Network ads will also appear on AOL.com and several other major search engines and comparison shopping sites that have "partnered" with Google.)
3. Google AdWords Display Network. These ads (which may be either textual ads or graphical banner ads) appear on privately-owned websites, not on Google.com search results pages. Google simply plays "matchmaker" by linking up the site paying for the ad (Party A) with the site hosting (or displaying) the ad (Party B). For example, Party A (who signs up through Google AdWords) says she's willing to pay $0.25 per click and wants her text or banner ad (whichever she chooses) to be displayed on pet-related websites. Party B (who signs up through Google AdSense) owns a pet-related website and is willing to display pet-related ads on it. Google (acting as the "middle man") facilitates the whole thing and keeps a few pennies from each click. (Example: Party A pays 25 cents per click, Party B receives 21 cents per click, and Google keeps 4 cents for brokering the deal.) You create AdWords Display Network ads through Google AdWords. Because Google PPC ads have the potential to drive the most traffic to your site, they are also quite competitive. But that certainly doesn’t mean you shouldn’t give AdWords and especially PLAs a go! Google is still our #1 PPC advertising option that we always try first. Besides the high traffic potential, AdWords is also a good "measuring stick" to see how successful PPC can be in your niche. If you do well in AdWords, you should be able to do well in the other less-competitive PPC engines.
Pro's Edge: "Creating High-Performing AdWords Campaigns" Pro Webinar Replay
Pro's Edge: "Unleashing The Power of AdWords Remarketing" Tutorial
When reviewing your AdWords campaign, it’s easy to decide what to do if people see your ad but don’t click it. You need to:
- improve your average ad position, typically by bidding a higher amount (so it comes up higher on the page)
- make your ad copy stand out more (as discussed above), and/or
- work to improve your ad's Quality Score (primarily by making the content of the landing page "match" the ad better).
But what if the problem isn't that people aren't clicking your ad? What if the problem is that the people who click the ad and visit your site just aren't buying anything? It’s a lot harder to pinpoint exactly what is making these people not convert. There are dozens of possible reasons that could be making people choose not to make a purchase from you.
If you find yourself having an overly populated group of those who click and visit but don't buy, don’t feel hopeless. The fact of the matter is that this group is a highly lucrative market that could make your conversions increase with a proper marketing strategy: Remarketing.
What is Remarketing?
Remarketing is marketing to people who have already visited your site. So you're re-marketing to them (a 2nd time). Here's how it works in a nutshell. Someone has clicked one of your PPC ads and visited your site, but they left without buying anything (for whatever reason). But Google (and the other PPC engines) can keep track of who has visited your site and show only that unique group of people a carefully crafted remarketing ad to entice them to come back and buy the product they were looking at previously. This is an extremely powerful marketing technique that taps into the power of exposing the person to your store/products multiple times, which is proven to drastically increase the odds that they decide to buy. Not only that, but remarketing ads tend to give people the feeling that you're a "big player" in the market, as they'll see ads for your store come up on sites all over the web (including hugely popular sites that "little guys" wouldn't normally advertise on).
Start by Setting up your Remarketing Tags
If you do not have your remarketing tag set-up, watch this video which will take you step-by-step through the process of setting up remarketing tags to start collecting information for your remarketing campaign.
If you already have your remarketing tags in place, let’s discuss how to go through the process of creating your campaign.
Microsoft Ad Center (Bing) PPC Advertising Options
Bing is our 2nd go-to option for PPC ads and offers all of the same types of PPC ads we just discussed for Google. In fact, Bing is so transparent about the fact that they've copied Google's PPC advertising platform that they allow you to straight-up copy over your AdWords campaigns over to Bing (which is really nice). You will need to manually set up Bing product list ads, though (they can't just be copied over). Creating PPC ads in Microsoft Ad Center will put your ads on Bing, Yahoo, Shopping.com and a handful of other second-tier search engines that have partnered with Microsoft. Bing's PPC engine typically won't bring you as much paid traffic as Google will, but in most niches, Bing will still bring you a fairly substantial amount of clicks. See the Pro’s Edge box below for a step-by-step guide on setting up PPC ads in Microsoft Ad Center.
Shopzilla PPC Advertising Options
Shopzilla is one of the best "second-tier" PPC portals because it is tied to BizRate and Beso as well. So by submitting your store's products to Shopzilla, you will have PPC ads running in 3 of the biggest shopping portals. Follow the steps in the Pro's Edge box below to create Shopzilla PPC ads.
Pro's Edge: Shopzilla PPC Ads Set-Up Guide
Shopzilla should be one of your top PPC advertising options because adding your products to Shopzilla (a top-tier shopping portal) will also get them inserted into both Bizrate and Beso, both of which are strong second-tier shopping portals. So it's a nice 3-for-1 deal that can drive a lot of good, targeted traffic to your site. We'll break the remainder of this tutorial into 3 parts...
- Sign up for Shopzilla & provide credit card details
- Create a Shopzilla feed file
- Upload the feed file to your Shopzilla account
Step 1. Sign Up for Shopzilla & Provide Credit Card Details
- Go to the Shopzilla sign-up page and proceed through the sign-up wizard to create your account and submit your basic store details. NOTE: If you have more than 1 store, you should create a separate account for each one.
- If you didn't provide credit or debit card details during the sign-up process, go to the Make Payments tab and do so now (unlike Google Adwords, with Shopzilla you must prepay for all clicks). You can opt to use the Continuous Traffic Plan, the Monthly Budget Plan or just make a One Time Payment.
At this point you should have all basic store settings in place and you should have a credit card on record, along with an account balance that can be used for future bids. If your store is on Shopify, you can quickly generate a Shopzilla feed file in your store admin panel and then skip to Step 3 below. If you are on some other shopping cart platform, continue on to Step 2 to learn how to create your Shopzilla feed file.
Step 2. Create Your Shopzilla Feed File
- For starters, we need a clean export file that contains all of the products in your store. Within your shopping cart's admin panel, find the page that allows you to export your product catalog to an Excel or CSV spreadsheet. If you don't know how to do this, you'll need to check your shopping cart's documentation.
- Open the product export file using Excel or OpenOffice. Note: If your product feed shows SKUs, Attributes or Options on their own rows, you will need to delete them by highlighting those rows, right-clicking & deleting them.
- Resize the Excel/OpenOffice window so it only takes up the top half of your computer's monitor.
- Now, download the Shopzilla example feed file and open it in Excel or OpenOffice as wel. Then resize it so it only takes up the bottom half of your computer's monitor.
- This .xls Shopzilla feed file contains the fields Shopzilla will accept. NOTE: The columns highlighted green are required; all other columns are optional, but recommended.
- Starting with Column A of the Shopzilla example feed file, go one column at a time while moving to the right. Use the heading (in row 1 of each column) to identify the corresponding data needed in the store's feed file (above). Then just copy & paste it from the store's feed file into the corresponding column in the Shopzilla feed file. Note: When you copy data from the store's data feed, you don't want to include the headings located in row 1 so be sure to select the info from row 2 down. HELPFUL HINT #1: Use the concatenate function within your spreadsheet program to add your store's URL before the Image URL & the Product URL. HELPFUL HINT #2: You can find a list of all the Shopzilla Category ID's here.
- Once you're done filling out the Shopzilla .xls file, copy all content in the spreadsheet to your clipboard by pressing Ctrl+A (Cmd+A on a Mac) to highlight everything and then pressing Ctrl+C (Cmd+C on a Mac) to copy it to your computer's clipboard.
- Now open up Notepad (or a similar text editor) and create a blank .txt file. Paste the content you just copied to your clipboard into the .txt file by pressing Ctrl+V (or Cmd+V on a Mac). Then save the file as a .txt file.
This .txt file is your completed feed file that you will be uploading into your Shopzilla merchant center account in the next series of steps.
Step 3. Upload the Feed File to Your Shopzilla Account
- Log in to your Shopzilla merchant account here.
- In the upper navigation menu, click on Manage Listings and then click Submit & Update Your Product Listings Datafeed within the body of the page.
- Click the Go! button within the 2nd section labeled FullList: Upload your product listings all at once according to our Product Listings specifications.
- In the field below that's labeled Locate your inventory file to upload you should browse for the .txt file you just created in the previous set of steps.
- Click the Browse button and select the Shopzilla .txt feed file you previously saved to your computer.
- Click the Upload my Listings button.
- Click the Commit Listings button.
That concludes the steps for establishing an account with Shopzilla, creating a product feed file and uploading it. While you wait for your feed file to be processed, you should go through all the sub-pages within the main tabs of the Shopzilla Merchant Center and make sure you have all your store's settings in place. While cruising through the sub-pages, make sure to visit the Pause/Activate Campaign page and make sure you are set to Active here. Once your feed is processed and approved ,your listings will only start running if you have a balance in your account and the campaign is set to active.
Private Banner Ads
Alright, let's switch gears now and spend a few minutes talking about private banner ads. As we discussed way back in the chapter intro, private banner ads are ads (typically graphic image ads) that appear on a particular website. Rather than using a major PPC engine like Google or Microsoft (Bing), you contract with an individual website owner to have your ads show up on particular pages of his/her site for a set monthly fee. You'll pay that set monthly fee regardless of how many times the ad gets clicked. Keep in mind that using the Google AdWords Display Network (which we discussed in the 'Top PPC Advertising Options' section above) basically allows you to place banner ads on topically related sites all over the web. You just don't have the same level of control about which sites you'll be advertising on (although Google does give you the ability to specifically exclude sites you don't want your ads to show up on). Using Google's Display Network automates and facilitates the whole process, playing "matchmaker" for sites (like yours) wanting to buy advertising space and sites wanting to sell advertising space. The drawback with using the Google Display Network for banner ads is that Google can only match you up with sites that have signed up for Google AdSense and placed AdSense code on their sites. Don't get me wrong, there are a ton of sites that have done that (it's one of the primary ways high-traffic informational sites/blogs make money). So it's not like the pickings are going to be super slim. But there are likely going to be sites in your niche that you'd like to advertise on that don't have AdSense blocks. For these sites, your only option is to reach out to them and inquire about paying a monthly fee to place an ad on their site. I've kind of already mentioned this, but another major difference between using the Google Display Network and paying for private banner ads is how your advertising fees are determined. With Google, you pay a set amount per click (based on what you set your max bid to be). With private banner ads, you'll pay a set monthly fee (based on the rate you negotiate with the private website owner).
Steps to Set Up Private Banner AdsThere are 4 simple steps for setting up paid banner ads:
- Find relevant, high-traffic sites you may want to advertise on
- Analyze the options and select the one(s) you want to try
- Design your ad
- Analyze the results and determine whether the ad is profitable
Let's spend a few minutes to quickly discuss each step.
Step 1. Find relevant, high-traffic sites you may want to advertise on. The obvious goal here is to find a) high-traffic, b) topically relevant sites that c) are willing to let you advertise on their site for a reasonable amount. How do you find such sites? There are a couple easy methods... 1) Search Google for your top 2-3 keyword phrases and cruise through the top 20-30 results, looking for non-competing sites that have ads on them. 2) If you've been running Google Display Network PPC ads, log in to your account and view the list of all the sites that have ever displayed your ads. Google seems to think these sites are topically relevant, and the sites have basically pre-qualified themselves for being willing to host banner ads as they're currently using AdSense.
Step 2. Analyze the options and select the one(s) you want to try. Many (or even most) of the sites you visit will likely have a page with information about the cost/exposure you'll get advertising on their site. Just look for an 'Advertise' or 'Advertise with us' link in the footer (or just below the banner ads you see on the site). If you can't find such a link/page, you'll need to find the site's 'Contact Us' page and reach out to the site owner to inquire about advertising opportunities. Be very clear who you are and what your store sells, and inquire about paid advertising opportunities. Create a simple spreadsheet to keep track of the key info about each paid banner opportunity. At a minimum, this spreadsheet should include information about the monthly cost, where your ad(s) will go (page and location), the reported amount of monthly impressions (i.e. page views) those pages get, how long of a commitment you have to make, and an indication of how topically relevant you deem the site to be. Once you've created this spreadsheet, you'll obviously need to make a decision about which site(s) you want to try out first. Then contact the site owner and sign up.
Step 3. Design your ad. Find out from the website owner what the exact dimensions of your ad should be. Once you know that, you have 2 choices to make: 1) what do you want your ad to look like, and 2) what page on your site do you want the ad to link to? Obviously, these 2 decisions go hand in hand, as the landing page will largely drive what the ad should look like. Now you need to create the ad. You're going to be paying good money for this ad each month, so to get your money's worth, you definitely want the ad to look professional and draw the eye. That doesn't mean the ad needs to be elaborate, though. Some of the best banner ads are incredibly plain and simple. Your only goals are to grab viewers' attention and persuade them to click the ad. You typically don't need a lot of text to accomplish that. Less is (almost always) more when it comes to banner ads. Use as few of words as possible to get your message across. Be sure to include a Call To Action (or CTA) in your ad... something you're inviting the viewer to do. There should be a very clear invitation to click it. Also, make sure to keep in mind who the "average user" is on the website you're advertising on. You want your ad to be appealing to that particular audience, while also conveying what it is you're selling. Also, look at the other banner ads on the page(s) where your ad will be displayed, and try to come up with something that will be unique and get noticed. Obviously, if you don't have graphic design skills, access to a good graphic design program (i.e. Adobe Illustrator), or an account at Canva.com or something of the like, you'll need to hire a graphic designer. I'd recommend posting a job on UpWork or oDesk, or, if you're on a tight budget, check out providers on Fiverr.com.
Step 4. Analyze the results and determine whether the ad is profitable. Just as with PPC ads, you'll want to analyze how much traffic and - more importantly - sales the banner ad is generating for you. If the profit you're making from the sales generated through the banner ad are more than covering the monthly cost of the banner ad, it's obviously worth continuing. If not, it's not! (Really complex, I know.) :) Without a reporting system like Google AdWords or Microsoft Bing has, though, how will you know how many sales the banner ad is generating? Through Google Analytics. I won't get into the details here since we go into it in depth in Phase 4, but the bottom line is that Google Analytics will show you exactly how many visitors and sales you're getting each month from the website displaying your banner ad.
Okay, let's talk about another great way to drive traffic to your site: setting up an affiliate program. We talked about affiliate marketing back in Chapter 2, but at that time we looked at it from the perspective of an affiliate. Now let's take a look at affiliate marketing from the perspective of a retail site owner (since that's what you are now). Note: If you're running an affiliate product store rather than an eCommerce site, you can skip this section since it won't make sense for you to set up an affiliate program as you yourself are an affiliate! :) When you set up an affiliate program, you'll set the commission percentage and other terms of how the program will work. Affiliates who sign up for your program will promote your store and products (on their websites/blogs, through their social networking profiles, via newsletters sent to their mailing lists, etc.) and will send targeted traffic to your website. You won't pay anything for this traffic. But when somebody referred by an affiliate buys something, the affiliate software credits the affiliate's account and you'll need to periodically send payments to your affiliates. So it's different kind of paid advertising. You're not paying for the traffic itself. You don't pay your affiliates a penny unless and until somebody referred by an affiliate actually places an order. To put it another way, you pay for acquisitions (i.e. sales) rather than paying for leads (i.e. visitors). The following video recaps what we've discussed and then lines out the steps for setting up your own affiliate program...
Step 1. Choose Affiliate Software or Network
The first item of business is choosing which affiliate network or software to use. There are 2 main categories: 1) large affiliate networks and 2) self-managed affiliate software. The affiliate network route is quite expensive. The most affordable major affiliate network (ShareASale.com) has a set-up fee of $550 and a "monthly minimum" of $25. Then there's Commission Junction (CJ.com), which absolutely rocks but which has a set-up fee of $3,000 and a $500 monthly minimum! There are, of course, major benefits to using a hosted network solution... 1) recruiting affiliates is easier since these big affiliate networks have HUGE built-in pools of affiliates looking for new programs to join, and 2) administering the program is easier since affiliates are paid automatically. Because of the hefty fees involved with joining a large affiliate network, most of you will opt to go the self-managed affiliate software route. There are a lot of affiliate software options available, but our hands-down favorite is Omnistar. It starts at just $47.95/month (after a 15-day free trial), and it's incredibly easy to set up and use. It's 100% compatible and super easy to integrate with almost every major shopping cart, including Shopify. (If you'd rather pay a $200-400 one-time fee and ditch the monthly recurring payments for the software, my top recommendation would be iDevAffiliate.) While Omnistar and iDevAffiliate don't have quite the same size of built-in affiliate pool that ShareASale and (especially) CJ have, they do have fairly sizable affiliate directories you can list your program in to attract affiliates looking to join new programs. And in step 4 below, I'll show you a bunch of easy ways to recruit affiliates to join your affiliate program.
Step 2. Set Up & Configure Your Affiliate Program
After you integrate your affiliate software/network (aka "link" it to your store), you simply need to configure the program setting. The most important decision, of course, is choosing what percentage or revenue you're willing to pay affiliates. The higher the percentage you offer, the easier it will be to recruit affiliates and keep them interested in promoting your products. But obviously you don't want to go so high that it wipes out most of your profit. As in all things, take a look at what your competitors are doing and make your affiliate commissions competitive. In addition to selecting the affiliate commission percentage, you'll also need to specify the amount of time the affiliate tracking cookie remains active (usually at least 30 days), the earnings cap (usually unlimited), the payout schedule (usually monthly, with a $50-100 minimum threshold) and the payment method (usually PayPal). After you've configured all of the program settings, make sure to run a couple of test transactions (using "sandbox" mode, aka testing mode) to verify that everything is working correctly. Your affiliate software/network should provide tutorials on how to do all this (integration, configuration and testing).
Step 3. Create Your Affiliate Program Information Page
The next step is to create a page on your site that basically "sells" your affiliate program to potential affiliates. This can just be a regular old page on your site (it doesn't need to be "tied" to your affiliate program) as long as the "join" button links to your affiliate software/network's sign-up page. You'll want to keyword-optimize this page (which you should know how to do at this point!) for the term '[main keyword phrase] affiliate program' so it ranks well in Google for that phrase (which affiliate marketers frequently search for). The goal here is to inform potential affiliates about your program and, more importantly, to entice them to sign up and start promoting your store. You'll obviously want to provide key information about your program (commission percentage, tracking cookie, earnings cap, payout schedule, etc.), presenting everything in as appealing a way as possible. It's also important to include professional-quality banner ads and other "creatives" your affiliates can use to promote your store/products.
Step 4. Get the Word Out to Potential AffiliatesThere are a handful of things you should to drum up interest in your affiliate program...
- List it in affiliate directories. If you're using ShareASale or CJ, your program is automatically added to the network's directory. If you're using Omnistar, you'll need to manually add it to Omnistar's affiliate directory. In addition to listing your affiliate program in your provider's directory, there are literally dozens of other affiliate directories you can get your affiliate program listed in. Most of them are free. Here's a list of some of the best affiliate directories to consider.
- Add an 'Affiliate Program' (or 'Affiliates') link to your store's footer. Affiliate marketers will often search for new affiliate opportunities by visiting sites relevant to their genre/topic and looking in the footer for an affiliate link. You'd also be surprised how many affiliate sign-ups you can get from ordinary visitors/customers on your site. So you should definitely take 2-3 minutes to quickly an a link to your affiliate program information page to the footer of your store.
- Invite topically related sites to become an affiliate. This is very simple but extremely powerful. Just do a few Google searches (for various keyword phrases related to your niche/market) and cruise through the results to find high-ranking sites that appear to be ad- or affiliate-based (as opposed to selling products or services themselves). Write up a nice email template that invites them to join your affiliate program (note: you can borrow most of the content from your affiliate program information page) and send it to all the sites you find.
- Invite sites that have been displaying your PPC display ads to become an affiliate. If you've been running Google AdWords PPC ads using the Display Network, you can log in to your Google AdWords account and see a list of all the sites that have ever displayed one of your ads. These sites are the perfect candidates to receive an affiliate invite! (They've essentially pre-qualified themselves as topically-related sites willing to promote related sites' products.) Reach out to these site owners directly (using the same email template discussed above) and invite them to become an affiliate for your store.