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Increase Your Site Traffic With The Pay-Per-Click
Search Engines And Guarantee You Always Profit Using These
3 Simple Formulas
How
would you like some traffic? How about some cheap targeted
traffic? No problem. The pay-per-click search engines
are exactly what you need to inject your web site with
a fresh stream of targeted potential customers --
people who are actively searching for what you're offering
-- without the typical expenses and risks associated with
many other forms of online advertising.
A
Quick Overview:
Pay-per-click
search engines are much like auctions -- they allow you
to bid for top-ranking positions under keywords of your
choice. For each visitor who searches the keyword(s) you
rank under and then clicks through to your web site, you
pay whatever you bid. Prices typically range from 1 cent
to numerous dollars per click-through for popular keywords.
And
this means that there are three key advantages to bidding on keywords in the pay-per-click search engines:
You
only ever pay for advertising that works because
you only pay when someone actually clicks through
to your web site. This means that pay-per-click search
engines can be a cheap way to draw targeted traffic
to your web site.
Pay-per-click
search engines will list your site within as little
as a couple of hours -- a couple of days at most.
So rather than waiting weeks, even months, for your
web site to be listed like you will with many of the
other search engines, you can start profiting from
the increased traffic and sales almost immediately!
All
you need to do to be ranked in a #1 spot is
outbid the other sites. It's a pretty straightforward
process compared to achieving and maintaining a top
ranking position in the "regular" search engines.
Obviously,
the pay-per-click search engines are a powerful opportunity
to increase your web site traffic for little cost. The trick, though, is making certain that you choose your
maximum bids based on the monetary value of one visitor
to your web site.
And
this is where a lot of people get confused or make costly
mistakes... They either abandon bidding in the pay-per-click
engines because it seems too confusing, or they bid more
than a visitor is actually worth to their site, losing
money on their advertising!
Strategies For Maximum Pay-Per-Click
Success:
In
the following article, I'm going to lead you through a
simple step-by-step process that will show you how to
collect the numbers you need to calculate the value of
a visitor to your web site -- using a special three part
formula -- and how to use this information to purchase
targeted advertising in the pay-per-click search engines.
Step #1:
Compile A List Of Statistics That Includes Your Unique
Visitors, Total Sales, Gross Revenue, and Total
Expenses for A Set Period of Time.
Before
you'll be able to start calculating the worth of your
visitors and what you can afford to pay for advertising,
you'll need some key figures; chiefly total number of
sales, gross revenue, total expenses, and unique visitors
for a set period of time.
A)
Total Number of Sales:
This
figure is easy to calculate -- you probably keep a close
eye on your sales totals anyway. Just add up the number
of sales you have made over a set period of time. For
example, this month you may have sold 73 widgets. So your
total number of sales equals 73.
B)
Gross Revenue:
Here's
another figure that you probably already have at your
fingertips. After all, what business owner doesn't keep
track of their gross revenue? If you sold 73 widgets for
$10 each this month, your gross revenue would be $730.
C)
Total Expenses:
This
is an important figure that many new business owners neglect
because, honestly, it's just more fun to calculate gross
revenue. However, until you know your total expenses,
you won't be able to accurately calculate your net revenue
-- your "in the pocket" profits!
To
guarantee that your business always generates a profit, your gross revenue should always be greater than your
total expenses. So sit down and start adding up all
of the expenses that you deal with to produce, package,
and deliver your product or service. This figure should
also include all of your operating costs for a set period
of time.
D)
Unique Visitors:
Frequently
confused with "hits" (which refers to the number of times
each file that makes up a particular web page has been
requested from your web host's server), "unique visitors"
refers to the number of different people who visited your
site. And it's the most important measure of web site
traffic hands down!
To
calculate the number of unique visitors to your web site,
you'll need to contact your web host to get your server
logs. (For those of you who don't know what a "server
log" is, it's simply a file that records each time someone
requests one of your web pages and the files associated
with it -- and it's literally a gold mine of data!)
Your
web host should be able to provide you with your server
logs. In fact, they may already have log analysis software
that will convert your server logs into easy-to-read reports,
graphs, and charts. If not, though, you can download your
own log analysis software by searching "log analyzers"
at Download.com.
WARNING! If you decide to research and
test log analysis software, be careful to look for those
that offer "unique visitors" as part of their reports,
not just "user sessions." One visitor may return to
your site numerous times (user sessions), so to be
certain your calculations are accurate, you must
know "unique visitors."
Step #2:
Calculate The Value Of A Visitor To Your Web Site.
Once,
you've collected the statistics and figures you need,
doing the actual calculations is the easy part. Simply
plug the numbers into the following 3 simple formulas:
A) Conversion Rate: Figure out how many unique visitors
you need to close one sale.
Unique Visitors / Total Number of Sales = Conversion Rate
Example: If over the month of November, you calculate
that your web site received 4,298 unique visitors, and
you sold 35 widgets, your equation would look like this:
4,298 Unique Visitors / 35 Sales = 122.8 Unique Visitors
Per Sale
So
in this case, your conversion rate would equal 122.8,
which means that you typically close 1 sale for every
122.8 visitors to your site.
B)
Net Profit Per Sale: Figure out how much profit you earn
on a single sale.
Gross Revenue - Total Expenses / Total Number of Sales
= Net Profit Per Sale
Example: If over the month of November, you sold 35 widgets
for $97 each, your gross revenue would be $3,395 (35
X $97). And let's say you calculated your total expenses
(production, packaging, web host fees, etc...) for the
month of November to be $2,537.
This means that:
$3,395 Gross Revenue - $2,537 Total Expenses / 35 Sales =
$24.51 Net Profit Per Sale
In
this example, your Net Profit Per Sale would be $24.51.
This is "in your pocket, after expenses, you can bank
it" profits.
C)
Visitor Worth: Figure out how much a single visitor is
worth to you.
Net Profit Per Sale / Conversion Rate = Visitor Worth
Example: This is the easy part. Just take the Net
Profit Per Sale that we calculated in part b ($24.51)
and divide it by the Conversion Rate that we calculated
in part a.
$24.51 Net Profit Per Sale / 122.8 Conversion Rate = $0.1995
or $0.20
So
in this example, each visitor to your web site is worth
$0.20. (Not to be confused with the value of a customer,
which is $24.51!) This means that you can afford to
pay as much as $0.20 to attract one new visitor to your
web site without losing money.
Step #3:
Put
Yourself In Front Of Your Best Potential Customers.
Okay!
You're almost ready to put your newfound knowledge to
profitable use and start buying targeted traffic in the
pay-per-click search engines. I say almost because there
is one more important step you may need to take...
Do
you know who your target market is? Do you have an accurate
profile of the folks who are purchasing from your web
site? And do you know what keywords they're searching
to find your web site?
If
you're not sure, then I'm afraid you'll need to do a bit
more homework before you start purchasing traffic because
until you know who your customers are and what keywords
they're using to find your web site, you risk wasting
money on unqualified traffic.
The
best way to learn who your customers are and why they
bought your product is by speaking with them directly.
Get on the phone, do an e-mail survey, offer a free gift
for feedback... whatever it takes! The more you know about
the people who have already bought from you, the easier
it will be to target new customers.
However,
another way you can figure out which keywords your target
market prefers is by using WordTracker, an online tool that collects the search
results from 24 major search engines and compiles them
into a database which is constantly being updated.
With
WordTracker, you can simply type in your keyword or key
phrase, and it will return a list of related keywords
and phrases. This is a really useful feature because it
will often produce keyword combinations that you may not
have thought of!
Step #4:
Use
This Information To Purchase Traffic In The Pay-Per-Click
Search Engines.
Now
that you know the keywords and phrases that your best
potential customers are typing into the search engines,
and you know the worth of one visitor to your web site,
you're ready to start purchasing traffic. You can start
bidding on the targeted keywords and phrases that you've
researched based on what one visitor to your web site
is worth.
In
the earlier example, a single visitor to your site was
worth 20 cents. So you could afford to bid as much as
20 cents per visitor in the pay-per-click search engines
without losing money.
Now
of course, you'd probably want to bid significantly less
than that, because you'll want to still turn a profit.
But if you were to bid 7 cents per visitor, and it took
122.8 visitors to close a sale, your profits would
still be quite substantial:
(20
cents profit per visitor - 7 cents advertising cost per
visitor) X 122.8 visitors to close the sale = $15.96 Total
Net Profit Per Sale
Sure,
your net profits drop a bit when you pay for advertising,
rather than rely on free sources of traffic. However,
you need to remember that your total sales volume is
going to go up -- perhaps considerably -- as long
as you purchase targeted traffic! And that means more
cash in your pocket at the end of the day!
Pay-Per-Click Search Engines:
The
pay-per-click search engines that you choose to buy traffic
from will depend on your budget. Overture.com (formerly
GoTo.com) is still the granddaddy of the pay-per-click
search engines, but its popularity has driven up the cost
of advertising there. Minimum bids now start at 5 cents
per visitor, there's a set-up fee of $50 (though it's
applied to your click-throughs), and there's a monthly
minimum of $20.
Of
course, with that said, if you can afford Overture, it's
still the best choice for driving targeted traffic to
your site. You're likely to get a higher volume of
traffic faster than with any of the others. Plus,
if your site is listed among the top 3 under any particular
keyword, you can expect your site listing to appear in
AOL, Lycos, and AltaVista searches, too.
Other
good choices for purchasing traffic include:
From
this list, I would recommend purchasing traffic from FindWhat
first because this is one of the faster-growing, better-known
pay-per-click engines. But all of the above should prove
to be good sources of cheap, targeted traffic.
In
the less popular pay-per-click engines, you can still
purchase listings for as little as one cent per visitor.
And remember that while you may not receive high volumes
of traffic from any one in particular, because you only
ever pay for actual click-throughs to your site, you
never lose money!
Final Thoughts:
Without
a doubt, purchasing traffic from the pay-per-click search
engines is one of the most profitable, most effective
ways to drive targeted traffic to your web site. As long
as you always base your keyword bids on the value of one
visitor to your web site, you can be confident that
your advertising will always be profitable.
If
you're new to Web statistics, you'll want to base your
initial advertising budget on the costs of acquiring a
first time customer. Over time, however, you'll be able
to calculate the value of your lifetime customers, and
use these figures to consider purchasing higher volumes
of advertising.
To
ensure you remain profitable, though, and until you're
comfortable accurately calculating these statistics, you
should focus on purchasing your advertising based on the
value of your first-time customers. Remember: Don't
GUESS! Base your advertising budget on tangible statistics
-- not your predictions of what your site might earn in
the future!
ABOUT
THE AUTHOR: Corey Rudl is the owner of four highly
successful online businesses that attract more than 1.8
million visitors per month and generate over $6.6 million
each year. He is also the author of the #1 best-selling
Internet Marketing course online.
To
Find Out How To Market Your Business
Online CLICK
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