How Long To Test Offers Before Making Profit

Successful affiliate marketers are always testing and developing new campaigns so when one dies out, another takes its place.  When promoting a product or service that you don’t own it’s necessary to develop an army of campaigns so you can sustain a consistent business.  Several factors weigh into being a successful affiliate such as how long do you “lose” money before you become profitable?  How many campaigns do you “test” to keep your daily profits high?  What campaigns are scalable?

The landscape of affiliate marketing, more specifically CPA affiliate marketing, has changed a lot over the last twelve months.  With affiliate networks and advertisers dropping like flies you have to take careful consideration when running traffic to any offer.  I recommend that publishers focus on ROI first.  In 2009 it was nothing for me to spend six-seven figures a month on a media buy and get a 30 – 40% return and be happy.  There was a huge variety in offers and networks that would do anything for the traffic.  Bi-weekly to daily payments – whatever it took to keep it coming. Now days it just doesn’t make sense to setup a media buy like this, because it’s possible the offer could go down or you may have to adhere to a certain cap.

Depending on how much an offer pays determines how much money I’ll spend testing.  The higher an offer pays, the higher my testing budget.  The lower an offer pays, the lower my testing budget.  For example, I’ll setup a mobile campaign with a budget of $25 if the offer pays around $3 – $4.  After $25 spent if I’m no where near being profitable, I move on to another source and/or another offer.  Some people think the more they spend, the more-likely they are to become profitable.  This is not true.  Early on you should be able to measure ROI and while I agree there is always room for optimization, it doesn’t make logical sense to keep running traffic if you’re no where in the ballpark of profiting/breaking even.

If you’re buying traffic for a higher paying offer (let’s say $30) then you want to adjust your budget accordingly.  I personally like to do about ten different creatives with a $100 budget cap for offers that pay around $30 and see where I am after the spend is up.  I then concentrate on the creatives that converted, creating several more to see if I cannot increase my bottom line with a solid eCPM (the metric most ad server reward advertisers on).

Scaling now days takes place when you’re consistently getting a large ROI and are able to branch out to similar traffic sources.  For example, if you’re spending $2,000 a day at one traffic source and getting a 100%+ ROI for a couple days straight it only makes sense to port the exact campaign over to a similar traffic source and run it.  This doesn’t mean go crazy though.  Test the new traffic source with $100 and see where you are.  Don’t go right in for blood, make sure everything is going to work out before opening up the flood gates.

I refer to this method as “bottom up” optimization.  You start at the bottom with low spend, closely measure ROI, and move up slowly.  Remain patience and don’t shoot for $1,000 a day profit right out of the gate.  Work your way up there.

With the increase of mobile traffic it would be nothing to blow through a couple thousand dollars in a few short hours.  Optimizing from the top down with mobile would be a bad idea as you’d have to spend so much money to get an accurate sample of all the devices.  Therefore I recommend starting with one operating system and/or carrier.  Don’t target everything you can, start slim, spend $25 or so, and see if you get any conversions.  Remember with mobile that many campaigns/landing pages don’t work on certain devices.  Understand before you get started what you need to target and how the offer converts.

Using the bottom up optimization method you’re easily able to keep new campaigns testing for your business to continue to thrive.  If you’re making a large profit every day you may want to set aside $100-$300 a day to rinse and repeat what I’ve already outlined.  If you’re not making a lot, then it maybe best to only test once you get your current campaigns sustaining some type of profit everyday and building up a bit of a “bank roll.”  The last thing anyone needs to do is go spend a couple thousand bucks in hopes of making returns.  It doesn’t work like this.  Focus on ROI with low spend and scale out as everything lines up in place.  Lots of money out there to be made, but it doesn’t come without effective and efficient testing!

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