Affiliate marketing is a promising and very profitable business and LeadBit partners constantly get reassured of that. CPA offers have the largest payouts and, accordingly, earnings, where ROI is calculated in hundreds of percent.
The pay-per-action model catches the eye of newbies. But from experience I can say that even for seasoned traffic managers, CPA offers are often too much to handle. Best case scenario – you barely get your investments back, worst case – not even that. Why is that so?
This may sound trite but there’s many factors in play and each specific product brings its own factors into play. But the point is always the same – wrong channels were chosen. Where should you get traffic from? What should be considered when designing creatives and which sources have the best conversion rate? To the bottom of that we’ll get down to today. I’m Julia Kozlova, let’s get started…
What is CPA?
The essence of any affiliate program, in contrast to traditional advertising, is paying its partners for each useful action. That’s why affiliate marketing is also called CPA (cost-per-action). Such a model is beneficial to everyone. Advertisers get “ready-made” clients and pay for a specific action the client performs. While webmasters earn more than when dealing with traditional advertising. Affiliate marketers get a tool to make money off the difference in prices for impressions from ad networks and payments from affiliate programs.
How affiliate marketing works: you choose an offer, promote it and collect a percentage
We mentioned a specific action of the client, what does that mean exactly? Different products are promoted on the Internet, which means that different approaches and payment models are used. This can be a payment for the client installing the application, registering on the site or just leaving their contact info (cost-per-lead, sometimes also called CPI- cost-per-install, but it’s basically the same payment for a lead).
Affiliate programs, naturally, pay the most for actually encouraging the client to place an order. This can be them adding money to their account, paying for goods, linking their credit card to their account or signing up for a paid subscription. This payment model is called CPA (the same cost-per-action. To get paid you must not only attract a client but make sure he purchases the necessary item.
The main beauty of CPA is that advertisers are willing to pay well for a client who placed an order. Sometimes, the size of the payment to the partner is several times higher than the order amount. For example, some online casinos pay up to $200 per deposit (and this includes minimum deposits that are usually around $5-10).
There are more than ten offers in the LeadBit affiliate network, where the payout is between 170 and 220 dollars. BITCOIN PRO CPA pays up to $950 for clients from Italy, BITCOIN TECHNOLOGY EVOLUTION – $600 for users from Germany, Great Britain and Scandinavia.
But, there is a “BUT”. It’s harder to motivate clients to actually make a purchase than just attracting them to a free resource.
Unlike CPL, where it is enough to convince the client to register and fill out a form with his contact info, the CPA model involves more complex actions – you need to convince the client to part with their money, which is not always easy. Click-through alone is not enough. The user who follows the link must be motivated. When setting up targeting, it is important to correctly highlight the target audience, you need to know it inside and out.
And there’s no going around the need to make up quality creatives. It is equally important to choose the right traffic source. When working with the CPA model, this is top priority. Where to look for your audience, what criteria should you pay attention to first of all?
The main criteria for selecting traffic sources for CPA offers
Before proceeding to an overview of channels for buying traffic, you need to understand what a good source means. What should it be? What to look for? Here are the most important criteria:
Yes, targeting, targeting and targeting once again. When working with a CPA affiliate program, it is important to find motivated users who intend to perform a useful action. A fleeting impulse under the influence of soothing slogans and a well-designed landing page can only bring short-term benefits, but it won’t carry the entire ad campaign. The client needs to be interested. Only in this case can you count on a high conversion rate (and therefore a high ROI). The ability to choose target audience is your trump card.
For those out of the loop, targeting is one of the ad network settings that allows you to more accurately narrow down the list of users that you intend to show your creatives to. Most have a GEO setting or are shown only at a specific time. Large networks introduce additional settings: sex, age, hobbies, marital status. For example, you can choose to have the ad only appear between 7:00 pm and 9:00 pm to unmarried men in Delhi, India, between the ages of 25 and 29 who are interested in online gaming.
Targeting gets you right on target
Targeting allows you to find your target audience, significantly increases the click-through (CTR) and the conversion rate (CR). Not all users will see the ad. Only those who are most like to actually be interested in your proposal, which means that you can achieve your goals with a much smaller budget.
Unfortunately, targeting is not always flexible. Social media has the most set-up options. But other ad networks are catching up. In addition to cookies, they scan metadata, use web analytics systems (Yandex metrics, Google Analytics), trackers (monitor the Internet history of visitors, all that’s needed is a small plugin or banner to be installed on the target sites). Yes, dear reader, on the Internet you are under total surveillance… We all are.
Traffic sources are free and paid. There’s no such thing as a free lunch, that’s why here we’ll talk about only the paid offers. How come?
You have to pay for everything… With money or time. Free sources (SEO promotion, groups in social networks, posts on forums) take a lot of time, months. And they’re good for users who have no money, not even like $100. In affiliate marketing this option can only be used as an auxiliary tool for warming up the target audience and does exclude the launch of paid campaigns.
Cost is the defining indicator, because the budget is always limited. It doesn’t matter whether you have $100 or $100,000, affiliates take into account the cost of the traffic, the profitability directly depends on it.
In affiliate marketing it is more convenient to work with traffic markets (ad networks), rather than directly with site owners. The price is determined by auction. The winner is the one who pays the most, of course, for a specific keyword, vertical or GEO.
But the prices from different sources differ tenfold. Search engine and targeted advertising in social media are the more expensive ones.Google Ads and Facebook Ads will have almost the same prices for a particular region. For example, on popular verticals such as Dating or Nutra the prices for the USA range from $2-3 to $6-7 per click. While teaser networks in those niches sometimes have prices less than 1 cent. Why is there such a gap?
The cost of ads on Facebook and other markets is determined via auction
Because of quality. Search engine and contextual advertising provides traffic with a high conversion rate. It’s aimed at users who are interested in the topic, are or were looking for a product or service a few days ago. Therefore, it is more likely that they will perform the needed action (register, make a purchase, fill out a form with their contact info). For teaser ads, where shocking headlines turn out to be nothing, the conversion rate is ten times lower.
Naturally, everyone needs quality traffic. That’s why there is a lot of competition in search engine and contextual advertising, hence the high prices, which is not acceptable for everyone. The point of affiliate marketing is buying cheap, selling for more. But for some verticals, like dating, payouts per lead are smaller than the cost per click.
Of course, there are many factors, for example, the activity level of advertisers. Today the price can soar up to $8, and in 5-10 days you will be lucky to buy traffic for only $1.5-2. But you shouldn’t rely on chance. Immediately choose a channel with a proper payback, for example, ClickUnder, PopUnder or push-notifications.
Check out which regions the ad network covers. No matter how much effort we put into targeting, it will not bear fruit if there is no target audience – there will be zero traffic, we will lose time during which the offer may close or lose relevance. For example, launching a campaign aimed at a Russian or Belarussian audience aged 45+ on Facebook will be ineffective. Vkontakte and Yandex work better here, though, in turn, they are useless in other regions. In China, turn to Baidu Ads, other platforms are tightly controlled and are very poorly represented here.
Sure, you could skip all this work and just opt for Google Ads. They’re everywhere even in remote Papua villages. But this is expensive traffic and there’s serious competition. It is more profitable for a beginner, and even for experienced arbs, to look for less competitive channels, where there is a margin for error. To fine them just use Google or specialized services like similarweb.com.
Limitations, possible complications
This criterion is usually in last place. But for some verticals it is fundamental. It makes no sense to look at the capabilities of a website if it does not accept offers in our niche in the first place. Google Ads rejects gambling, adult, smoking or any other gray-hat offers. Problems will occur if you’re advertising Nutra or addictive drugs. Facebook is a little more loyal, but it only works with verticals if it’s officially allowed by local law.
Gambling is banned by many networks
You can choose less demanding networks, for example, teasers. They accept any promotions, even goods or services that imitate famous brands, drugs or pornographic materials. But the conversion rate, as well as the traffic volume, is several times lower. You can wait months or even years for your ROI on these projects. So what’s to be done? There are several options:
- switch to white-hat sources – but it is difficult to work with them: payments are small, rates on stock exchanges are high, it is quite easy to go into the red;
- work with teasers, test out new GEOs, take up additional offers and simultaneously work on those. You will have to spend many times more time and come to terms with the fact that the return of the invested funds together with the profit will take 5-6 months at best;
- buy traffic on large exchanges by resorting to deception, using cloaking (replacing the landing page: a white-hat creative for moderators – the “real product” for users), farming accounts, etc.
Promoting fake accounts or substituting landing pages during moderation allows you to get a huge and interested audience. It’ll take some effort to pass moderation and you’ll need to come to terms with the fact that the account will get banned after one or two weeks with the money on it getting frozen. But in 7-10 days of promotion on FB or Google Ads, if you are lucky enough to get verified, you can earn many times more than using teaser networks for a whole year.
- Design your creatives in detail;
- If you’re farming accounts,…