CPA Share

I am honored to be the keynote speaker at SMX Singapore in 6 weeks from now, kicking off the conference with a talk on “social media”. I’ve spoken on panels before, though this engagement is more important and I want to make sure it’s a killer presentation. I’ll cover a bit of what I’ve learned about social advertising, plus cover how game dynamics is the driver behind social network interaction– status, collection, unlocking, feedback, randomization.

With vastly more information being available to advertisers for targeting, the advertising platforms that rule in 5 years from now will not the ones that dominate today. Search will be more than showing results based only on what someone has just typed into a box– it will encompass who they are, their preferences, what their friends like, and what people like them like. Socially-aware search is still a pipe dream, but we’re starting to see examples of it in early social advertising platforms, however crude the earliest examples are.

Beyond advertising, social data can answer questions such as “Do you know a reputable dentist in Santa Barbara?”, “What political blogs do you think I’d enjoy reading?,” or “Where can I find a cool fedora hat?”– questions that search engines cannot answer properly today.

So how do brands and direct marketers take advantage of the wealth of social data that is now available? How can that drive smarter ads and new forms of interaction? I need some clever examples to demonstrate how social media is changing the face of advertising. Send me your examples— they can be something currently being done or ideas for things that could be possible.

A couple examples I intend to use are from Me.dium, a client of mine that is a social search engine>— plus SparkPeople.com, a community for weight-loss that relies heavily on points-based interaction. Tell me what you think and you could win one of 5 LeaderClicks T-shirts!

Deadline for submission is October 2nd– just a few days away. Post your responses here or send to harrison@gevirtzmedia.com

I saw 52 comments on my guest post today on Shoemoney.com. This was one of the longest posts I’ve done. And I’m pleasantly surprised by the feedback there– only one hater, who tried to broadbrush all affiliate bloggers as folks who actually don’t make any money, but exist to prey on noobs. And even that person came around to note that not all affiliate marketers are scammers.

The folks who left comments were from broad walks of life– from running a site for chiropractors (charging up to $550 CPM rates– that is not a typo), to a work at home mom, to affiliate managers, to our buddy Daehee who coached the team that won the Google Online Marketing Challenge last year. There were the typical range of comments from folks who don’t know what PPC stands for, folks who noticed how long the post was, to folks who got some value.

But the most interesting thing is not one of these comments, but what WASN’T said. I didn’t see anyone from the ad networks or any ad serving engineers post comments. The truth about scrubbing is something that large affiliates keep to themselves. Same is true for ad networks that employ a form of “boost” to favor low performing ads on the network– great for the advertiser, but a penalty paid for by publishers who make less money. We could spend hours on the tricks that are employed by ad networks, in a sort of Mason’s handshake for the uninitiated. Do most ad networks scrub? Yes. Is this a legitimate practice? Yes. But do most ad and affiliate networks also scrub in unethical ways? Yes.

A lot of affiliates were asking about a more in-depth post on scrubbing. Rather than go into all the ways– which is something I couldn’t do, because there are so many that I don’t know, too– it’s better to just say that you should look at your earnings. So what if they take 30% out? Perhaps they are paying you 50% more per lead so it backs out better than the other offer. Sure, you could ask that the advertiser place your pixel on the page– close to their pixel (since position on page matters). And you could get your AM to swear that you aren’t getting scrubbed– yeah, the check is in the mail.

So the answer? Just look at eCPM. Don’t worry about payouts (that’s a sucker play) or other metrics. Understand that CTR x eCPC = eCPM. And with CTR holding equal, then you want maximum eCPC, which is the payout times the conversion rate. So if the conversion rates are the same for an offer across two networks, you’d take the one that has the higher payout. But often the same campaigns sending traffic to the same offer page will convert differently between networks. Scrubbing is not the only reason, but the primary one. So choose according to what makes you the most– run a primary network for the offer, but reserve a small portion to run on the other network, so you can check for discrepancies between the two. If you have a lot of traffic, it’s only smart to do that.

I believe that smarter pubs will join LeaderClicks. If you believe that eCPM is the true measure of earnings, then sign up. If you think that lead payout or eCPC is what to shop for, then join another network. We’ll be releasing a series of tools to let you rotate ads between us and the other guys to keep us honest. Or write your own script– it will only take you 20 minutes. Most of the networks who run social inventory are absolutely fleecing publishers. I won’t mention names, but these folks know who they are and what margins are set for the street payouts. We could play that game, too, but think that in the long run (and in internet time, that’s 6 months), the market will eventually figure it out. I want to be ready for that shake-out now— I want publishers to ask the right questions of their ad networks, so they can make informed choices about who really does pay better– not who says they pay better.

I am 16 years old and though I enjoy a decent standard of living, you won’t see me renting office space on Madison Avenue, hiring a bunch of empty suits, or holding contests with glamorous prizes— these are all things for show that actually eat into both network profits and publisher payouts. The pie must add up to 100%, so you do the math on how that dollar of gross revenue is allocated. We have a small team of less than 20 people, primarily engineers who work on ad serving, plus a few analysts. We’re self-funded, but have more money than the average start-up, since we’ve made a fair bit doing affiliate marketing ourselves. I’d like to think that this gives us a better understanding of the publisher point of view.

In a future post, I’ll talk about some of the things that our ad server does, such as Dynamic Social Ads, where we personalize ads on the fly based on user profile information. And there are cool statistical techniques where we match offers against groups of people with common traits. We could go on and on crowing about how we have “proprietary” black box voodoo magic Google SocialAdFriendPageRank secret sauce– but really, it’s just about who pays you more money, pays on time, and is fun to work with.

So sign up for our social ad network (or if you have other inventory, that’s fine, too), use promo code “HARRISONSENTME” and I’ll send you a free LeaderClicks T-shirt when you do at least $100 in earnings. Oh, and the shirts are PIMP!

Most of you know to look at conversion rate, eCPC, CTR, CPC, and some other metrics that you can see inside your PPC campaigns. Did you know that your analytics tool can also help you get a sense of keyword quality– thus assist you with bidding and keyword grouping?

Bounce rate is governed by a combination of these factors:

* nature of the term itself: you are trying to sell “raspberries”, so you buy that term as well as “fruit”– in this case, “fruit” is broader than “raspberry” but has more volume. So you have a trade-off with volume and relevancy, as well as synonyms– for example, “apple” can be a fruit and cool electronics manufacturer.
* your ads: you might have bought relevant terms, but your ad is misleading– promising something that doesn’t exist. Maybe the product isn’t free.
* relevancy of the landing page: you’re sending people to pages that don’t speak directly to the term folks are looking for. Perhaps your keywords, ads, and content don’t match tightly.

If you have a multi-page or multiple visit conversion, then bounce rate is a great early indicator of traffic quality. In you are converting on a single page, then bounce rate is not meaningful. That said, while using eCPM and other ROI-based metrics to govern bidding overall, you can use bounce rate in several ways:

* if the bounce rate is over 70%, turn the term off. If the term is bad enough, you may even want to delete the term and also add it as a negative keyword. For example, we sell franchises for a major fast food chain and discovered that any keywords with “home” were of ultra low quality. So “work from home” and “make money from home” are horrible– these are not people who have $150k in cash to open a franchise. Having “home” as a negative keyword also improves traffic for “business opportunity” on broad match.
* if the bounce rate is less than 30%, then something is probably working with the connection between your terms, ads, and landing pages. If that term has high volume, place it in it’s own ad group and spin out more related terms. If your keywords are tightly grouped by theme (every term in that ad group means the same thing), then you should see bounce rate to be similar. Ignore bounce rates on low volume keywords, since you’ll see a lot of noise.
* if the bounce rate is medium (30%-70%), then you can use that as a quasi-lead. For example, if term A has a bounce rate of 40% has 60% of folks making it past the first page. And term B with a 70% bounce rate has only 30% of folks making it off the page. Thus, term A is delivering twice as many visitors per click as term B– and could be bid up twice as much, all else equal. You’re still going to manage to a CPA, but if don’t have many conversions or a low budget, this is a great early metric on whether that person will become a lead.

Our lead gen consulting company manages PPC campaigns for clients who have at least $10k per month to spend. keep reading my blog for more articles on maximizing online performance. Hope this was helpful to you.

So after the haters have complained about the ancient Wordpress theme on cpashare.com, I had my designers make this one. Tell me what you think– besides the fact that the comments portion isn’t working properly at the bottom. But clearly, having a crappy blog design MUST mean that I don’t make money. And if I don’t post photoshopped pictures of checks of my affiliate earnings (I get wires, for those of you do enough volume to know), then it must also mean that I’m not the real deal. So who really cares?

This blog could have a pink background with bunny rabbits, gold chains, and hundred dollar bills. Would that make this blog worth reading? I don’t know about many of you, but I read blogs to learn what’s going on in the industry and there are some folks who come here in the hopes of gaining some tips to help grow their affiliate earnings. My goal is to be helpful voice in a sea of a babblers, who bring down the conversation to useless forum chatter. I’m not a god by any means, (hey– I’m only 16) but at least I’m striving to share useful tips. So don’t come here to hate and basically dumb down the conversation. Reading the comments here often makes me feel like a full-grown adult– you lurkers know what I’m talking about.

You’re going to see a lot more articles here– on more than just affiliate marketing networks, and I welcome feedback on whatever you think I should write about. I’m not the “last word” on affiliate marketing, but at least you’ll get a thoughtful answer.

I was at McDonalds recently and noticed the writing on the bag: “Made with 100% Real Beef.” And then something to the effect of “And with a number like that, you can’t get any better.” Reminds of the breakfast cereals that are made “with” 100% real honey– meaning that they have a giant vat of cereal and high fructose corn syrup, and someone with a squeeze bottle squirts in a few drops of 100% real honey. After all, it’s made “with” 100% real honey, beef, leather, or whatever– as opposed to being made “of” that item.

Whether marketing and advertising are just different shades of lying is a philosophical debate. But what’s not a question is the number of charlatans out there fleecing clients on PPC and SEO. This is not just run of the mill “we’ll get you to #1 in the search engines” kind of talk— these are professionals that charge insane rates. One our our clients is a major fast food chain that spends 6 figures a month with us on a full range of PPC, SEO, email, and webmastering. We partnered with an SEO company that in one of first meetings attempted to claim that he could at-will stop people from linking to the client’s site. When one of our guys asked how exactly this could be done (since I could just create a blog post and link to the site), he said that it was proprietary technology. After 2 1/2 months of keeping this guy on, with no improvement on rankings, we got rid of him– not before he attempted to ask for more fees, and also trumpeted the value of his RSS network, and 3 way linking strategy. His final gasp was to mention using Twitter as one of the keys to driving more leads for the client. It wasn’t a bad run for this guy, who makes a living getting first page rankings on no-traffic terms.

So if you want to make an easy living fleecing corporate clients, do this (I’m not kidding– this is so easy):

* Proclaim that you are an expert at SEO: create a local meetup group (with 2 other conspirators) and say that you founded the “SEO experts” group in your city. Join a few professional organizations, such as SEMPO (yes, they are legit). Put up a canned website with huge logos for Google, Yahoo, MSN, Verisign and other networks– saying that you are partners with them in advertising. List yourself in a few directories.
* Get a few clients: Word of mouth marketing is easy. You won’t be keeping clients very long, so make sure you have a steady inflow of new clients to replace the ones who find out they’re getting fleeced. Don’t have references? That’s okay– mention that your clients are confidential. After all, you wouldn’t want other clients to know about what we’re doing for you, right? In your initial client meeting, spend the whole time talking about 301 redirects and 200 status codes– sound ultra technical, especially if you can’t actually program. Don’t worry, the client doesn’t know how to program either, so your cover will hold.
* Create ranking reports: Using your proprietary technology (just pay for a subscription at seomoz.com or seobook, create a monthly ranking report on terms that you choose. The key is to choose terms that have no traffic and nobody else is competing for. Choose 4 and 5 word search phrases– go for “large, custom blue widget manufacturer Los Angeles”, not “widget” or “blue widget”. Claim that the longer terms are “higher relevance.” When the client asks for how long it will take to get results, say that nobody really knows the search algorithms except Google and Yahoo themselves– and that anyone who makes firm promises is a charlatan. This excuse will buy you lots of time.
* Set up a few wordpress sites: Using those search terms you listed, buy the domains. To flush out this snake oil peddler mentioned above, we ranked on franchise review site. Within a couple days, you’ll be on the first page of Google for that term– if not in position 1. If you’re sophisticated with programming, auto-generate a bunch of fake content by scraping other blogs. Or follow what bluehatseo.com has to say about this. Not needed— buying a few domains and putting up free wordpress templates is sufficient here.
* Proclaim victory!: Whew, it’s been a LOT of hard work, but look– we got a #1 ranking on these 5 terms. If you want to get more mileage out of it, do it with lots of fanfare and spread out the results over time. If you deliver these results right away, they’ll think it was easy. Go on vacation for a few weeks, then come back and proclaim victory. If there’s someone who’s smart about SEO in the client meeting, who asks questions about whether those terms have traffic, babble on about how you have to take a holistic approach to SEO and that many factors will affect rankings.
* Collect fees as long as you can: If you’re lucky, nobody will ask any questions. But if they do, be ready with these excellent comebacks:
o Why aren’t rankings on my main terms going up?: “Sometimes you take two steps forward and one step back”– fluctation in results is perfectly normal. Your site needs more unique content. We’re going against some strong competitors here, so it will take some time.
o But PPC seems to be driving traffic and leads, not SEO: PPC is a short-term solution that is bleeding you money. The real pro’s recognize that organic results are more trustworthy to users– and getting in naturally will save you money over time.
o I don’t understand what you’re doing– in fact, I don’t think you’re doing anything: There are many factors involved here that only trained professionals like myself will understand. I go to a lot of conferences to network with other people like me who don’t know anything either. We have a proprietary RSS network and series of blog sites– I’m sure you can understand why we don’t divulge trade secrets.
o I don’t see any more inbound links than when we started: Okay, the client must have talked to someone else, since they didn’t know what an inbound link was before. You know you don’t have much longer with this client. Throw a Hail Mary: “I don’t think we’ve been giving your account the proper level of service here. What I’d recommend is that we move you to a premium package at $Xk more per month, which will allow us to put more effort on your initiatives.” If they don’t go for that, try to talk about social media optimization and the power of online comunities, Web 2.0, twitter, and such. As a final effort to block this other firm that the client has been talking to, try to scare him with the risks of black hat SEO, that they could get banned FOREVER.

What’s sad is that this is pretty close to what has happened at a major client– the difference being that we actually put up the wordpress sites to reveal the trick. I know– it’s bad etiquette to expose the tricks that other magicians use. But someone is eventually going to realize that it’s a magic show and that the coin was behind your hand all along– and that there was a hidden compartment with a mirror hiding what was in that supposedly empty box. Well, in this case, the box actually was empty.

If you are an SEO who is making money doing what I’ve described above– kudos to you for living by your wits. But now it’s time to learn some real skills to place in your bag of tricks.