Facebook Advertising | Finch Sells

Why Your Campaigns Die In 36 Hours Or Less

Mar 13 2012

What’s the difference between a campaign that prospers for months, and a campaign that crashes and burns in 36 hours? It’s normally a source of renewable traffic.

A renewable traffic source can be trusted to produce leads and sales consistently on auto-pilot. It’s like the wind turbine of affiliate marketing. Slow, ugly, and certainly not glamorous, but future-proof.

There aren’t many wind turbines left in affiliate marketing.

Google AdWords remains – perhaps the greatest renewable traffic source of them all – but it’s out of bounds for most CPA marketers. If we are to drag fresh eyeballs to our affiliate campaigns via Google, we typically have to engage in SEO warfare.

AdWords arbitrage was the perfect example of renewable traffic. A campaign could be launched on Day 1, optimised by Day 2, and still be profitable on Day 365. A good day’s work went a very long way on Google, and it still does, just not for the majority of scumbags like us.

The current slew of popular advertising platforms – think Facebook and Plentyoffish – are quite the opposite of future-proof turbines. You can make good money, but in doing so you’ll often feel like Guybrush Threepwood, sprinting from the hounds, having just pillaged a barrel of limited-supply oil.

Profit exists, but it’s usually achieved with smash-and-grab marketing.

Facebook and Plentyoffish, in the literal sense, are renewable traffic sources. Each site is growing at a rapid rate, and with that growth comes new users to advertise to. However, reaching them is not always easy. Perhaps more importantly, affiliates don’t seem to care about finding those fresh eyeballs.

They focus on monetizing the traffic source, without factoring in the supply of new traffic, which inevitably leads to questions like…

“Why do my campaigns fizzle out so quickly?”
“I was profitable for 2 days… and then the ROI nose-dived. What happened?”

Sustainability is achievable with careful planning. It just requires that you launch campaigns with a plan for Day 10, not just Day 1.

Smash-and-grab marketing is fine, but don’t fool yourself in to thinking your big break will come when you start making $500/day for all of about 36 hours.

Let’s take Plentyoffish as an example.

Why do Plentyoffish campaigns crash and burn so rapidly?

It’s normally because affiliates sacrifice volume for super targeted campaigns, or because they go broad without having a plan for keeping the campaign fresh.

Example:

What’s wrong with the long-term potential of a campaign that has 3 banners and targeting like this?

There’s one big problem: inevitable banner blindness.

Where is the new supply of traffic? Targeting all users under 600 logins will only be effective if you introduce a staggered approach to your creatives, which is something that I wrote about extensively in Premium Posts Volume 1.

Run this shit for more than 48 hours and what’s going to happen? Maybe you’ll score a profit in the first 24 hours (if you’re lucky), but sooner or later, users are going to grow sick of the same banners.

There’s also the microscopic nature of the campaign. Plentyoffish is a big traffic source, but it’s not that big. The slew of new Jewish females aged 25-35 can’t possibly keep up with the rush of new advertisers looking to make money from them. To have any hope of profiting over the long term, you need to have a structured campaign.

Here’s how you might sustain the example above with minimal ROI degradation:

Day 1:

Active Banners: A, B and C.

Day 2:

Active Banners: A, B and C.

Day 3:

Active Banners: D, E and F.

Day 4:

Active Banners: D, E and F.

You have four variations of the same campaign, each targeting different mini-demographics, or using new banners to keep the campaign fresh. You will lose volume, but you’ll gain stability and a cycle of profitability that lasts much longer.

Alternatively, you can focus your campaigns on targeting only the the newest members, so the ads should always stay fresh.

To do this, simply set your login count to below 50 and your ads will be reserved for the new fish.

This is how you turn limited reserves of traffic in to renewable traffic. Instead of pillaging a barrel of oil from a limited reservoir, you’re building a boring wind turbine – letting it accumulate profit over time – and moving on to the next one.

Note for Plentyoffish affiliates: You should also check out this post on how to tackle unstable conversion rates.

What about other traffic sources?

Facebook campaigns can be broken in to Group of States A and Group of States B.

Instead of targeting by country, you select 25 states in each campaign and rotate them through alternate days. You can then duplicate your 6 best ads so that half show on Day 1, and the others on Day 2. Mix and match as you go forward. You should see a dramatic reduction in the wear and tear on your CTR.

When advertising via PPV, the frequency cap is similarly important. I set it as low as possible, to the point where a user might only see an advert once every 4 weeks. This can deep-throat the hell out of the volume, but it’s worth it for stability. My hairline thanks me, and yours should too.

Eh, only kidding. I’m going bald.

Focusing your efforts on renewable traffic sources is the best way to avoid Monday mornings where last week’s work is staring at you from the bottom of the trash can. There’s nothing I find more de-motivating than busting my arse on campaigns that have a shelf life of 2 days.

Unless those days are generating floods of traffic and majestic profit, they are days wasted. It’s not worth breaking your back to get a campaign profitable if the foundations are likely to be torn up overnight. It’s fucking sandcastle economics. Why bother?

Recommended This Week

Want to read some of my more candid insight on how to build profitable affiliate campaigns? You be needing some Premium Posts, mon ami. There’s about 300 pages of crap that can actually make a difference to your success in this industry. Check them out here.
Any Facebook advertisers still out there? Check out Lots of Ads. Spy on the best performing ads in international markets, save money on your translations and learn from affiliates who are already making money (or perhaps wasting it recklessly?). The tool now supports 21 countries, which should be plenty to keep you busy.
If you’re a new reader here, please add me to your RSS. Also follow me on Twitter. Thanks for reading.

Stupidly Obvious Facebook Tip: Do The Maths

Nov 14 2011

Affiliate marketing is pretty simple when you boil it down to the basic mathematics. We want to sell a lead for more than it costs us to generate the traffic. Simple logic, right?

You could be forgiven for questioning this wisdom when so many affiliates are busy creating campaigns that have zero hope of scaling.

Before you launch any affiliate campaign, you can save yourself a lot of time by doing the maths required to establish your likely profitability. And not just profitability, but profitability that is worth your time.

A tramp can beg for change and make a profit, but so what? You don’t see ‘get homeless get paid’ splashed across the industry blogs. Profitability is worth jack shit if the energy you’re exerting makes the tramp look like a connoisseur of passive income.

This is especially the case on Facebook where rising click costs have pushed certain niches in to the abyss.

So let’s say you’re going to promote a gaming offer on Facebook. Let’s also say you’re a reckless optimistic son of a gun who refuses to venture out of the American market.

We’ll assume you have an offer paying out $2, and a clean slate to target it as you wish. Before you even think about creative angles for promoting the game, you need to take a step back. Take a deep breath and ask yourself the following questions.

1. Have I established with my affiliate manager a baseline EPC for promoting this offer on Facebook?

If the answer is no, you should probably do so at the next opportunity. I’m saying this not just because the EPC will form a cornerstone of your profitability equation, but because many networks take on so many offers that they sometimes forget to remove the duds from your control panel.

Networks: I’ve never understood why you try to win me over with thousands of different offers. I’d rather you had a smaller pool of advertisers that were closely maintained. Sometimes I find an awesome looking offer, but when it’s buried beneath 3000 others, there’s a part of me that is skeptical about the likelihood of it being desirable to run.

2. If the EPC is lower than $0.15, am I going to be able to generate a CTR of 0.3+% to reduce my CPC costs accordingly?

This is a rough estimate that I apply to Facebook campaigns in America. If the best you can hope for is an EPC of <$0.15, you know straight off the bat that you can't target super broadly. You need laser targeted keyword groups hitting a CTR around the 0.3% mark.If you can't visualise a method of generating this kind of CTR for the offer, the maths don’t work! There’s no need to throw a hissy fit when, actually, you’ve saved yourself a lot of time.

3. Assuming I can strike the high CTR, is the demographic large enough to maintain it over a long enough period to make good money?

Some creative angles are brilliant. But the consequence of laser targeting is the reduction of the demographic size. If the demographic is too small, banner blindness will kick in within days. In this situation, you need to evaluate: is my ROI sufficiently high to justify the campaign’s rapid demise?

If your ROI is low, the maths hinge on your volume.

Low volume scenario: 200 leads at 25% ROI on a $2 payout ($320 spend) = $80 profit
Mid volume scenario: 2000 leads at 25% ROI on a $2 payout ($3200 spend) = $800 profit

The first scenario, the ‘crash and burner’ as I like to call it, wouldn’t be worth my time. That’s less than my hourly rate, and just not worth the investment. The second scenario is worth it, even if it doesn’t make you rich.

If, however, the low volume scenario could be countered by a high ROI:

Low volume scenario: 200 leads at 100% ROI on a $2 payout ($200 spend) = $200 profit

This scenario would be more appealing to me not for the higher profit, but because of the potential in scaling sideways. Any campaign producing 100% ROI is worth exploring, but most of the time, you will need to scale sideways (using similar keywords, doing further demographic research etc) to keep it growing.

4. Does my offer accept under 18 traffic?

Any offer that accepts under 18 traffic reduces the strain on your CPCs. You will generally get cheaper clicks when advertising to kids, so the pressure to deliver a stunningly high CTR is reduced.

5. Can I generate enough volume to get a payout increase?

Sometimes it’s worth running on skinny margins and high revenue if you know that there’s a reward for generating the extra volume. When evaluating your CPCs vs EPCs, take this in to account.

6. Can I buy a payout increase with high quality traffic?

Another strategy for those thinking long term is to seek out the best quality leads and strive to break even. Drive just enough volume to get the advertiser to take notice. Assuming your leads are twice as good as the average affiliate, the raised payout could see you profiting comfortably.

The maths in this case hinge on isolating the advertiser’s favourite type of customers and following the same procedure. What will they cost to reach? Is the demographic large enough to sustain the campaign beyond the payout raise? Can you come up with enough angles to fight off the banner blindness?

7. Am I being an idiot by not considering international markets?

After you’ve evaluated the equations above, you will invariably be left with a pounding headache.

“The maths don’t work, they just make it worse, but I…”

The sad reality is that for most Facebook campaigns in 2011, the maths just don’t work. Where they do, the volume is shot to such a low ebb that your reward for finding profitability is some pocket money and the mild disconnected satisfaction that you ‘beat the system’.

However, taking your ideas to less saturated international markets is a great leveler. From my experience, it can tip the equations of profitability from ‘squeaking a quick buck’, to ‘laughing all the way to the bank’.

Many affiliates just refuse to see the light. Most of them are blinded by the false allure of revenue. Revenue, revenue, look how ballin’ I am, here’s some more revenue!

When you look through your network’s newsletter and see the American version of an offer paying out twice as much as the Euro version, do you actually stop to do the maths?

Reduced click costs + higher CTR + less banner blindness + less competition + greater chances of a payout increase = why the hell are you still advertising to America?

Now I’m not saying that going international is a shortcut to profit, and I’m not saying that advertising to America is a recipe for failure. My advice is simply to do your maths.

Before throwing a hundred campaign ideas at the wall, it helps to grab a pen and some paper, and to actually write down your equations.

What is the average EPC? How can I improve this?
What is my required CTR? How will it affect my volume?
What ROI can I expect? For how long? How about in different countries?

I know affiliate marketers don’t naturally gravitate towards the dark art of actually having to plan shit, but it helps to have some numbers in your head. Nail down the figures before you go image hunting on Bing.

Recommended This Week

For those of you who advertise on Facebook, Premium Posts Volume 2 splurges over 70 pages of my tips, techniques and strategies for conquering Zuckerberg’s monster. I’m confident you’ll get a lot out of it, including some much better traffic sources for our gaming offer example above!
If you’re a new reader, please add me to your RSS. Also follow me on Twitter. Thanks for reading.

Just Released: Premium Posts Volume 2

Nov 03 2011

When I introduced Premium Posts with last month’s guide to Plentyoffish, I guess you could say it was a wild stab in the dark.

I didn’t really know whether you guys would buy in to the concept. So I was extremely happy to see that so many people did, and that I didn’t receive a single refund request from hundreds and hundreds of transactions.

I don’t know, maybe you’re just being polite. Maybe you saw that the poor ape had spent so long slaving away over his keyboard in the darkness and you didn’t want to offend him.

Either way, the posts have received some excellent reviews. I enjoyed writing them, so a follow-up was inevitable. And here it is.

This month, for Volume 2, I’ve decided to take on the mammoth task of covering Facebook.

The posts are designed to give you inspiration not just for CPA campaigns, but for practically any marketing campaign you would be brave enough to launch on the world’s largest social network.

Just like Volume 1, many of the ideas discussed are transferrable to other traffic sources. It’s not the sort of Facebook guide that you will be finding on a Waterstone’s shelf anytime soon.

Some of the techniques used are controversial. I take no responsibility for how badly you manage to fuck yourself in the arse if it all goes tits up.

I think you’re going to like them, well, I hope you’re going to like them. My hairline lost about four inches but I can say that no kittens were strangled during the creation of these posts.

So, here you go, click here for Premium Posts Volume 2.