Please critique my PPC method / and a question about direct linking negatives

[Melon Farmer]

Hello All,

Please let me know if the following statement is true or false: As long as my EPC is greater than my CPC, I will make money.

An example:

I find a keyword which averages $0.23 per click. I direct link to an affiliate landing page which converts at 2%, and pays a $25 commission. For every 100 clicks I will average 2 sales. So for every two sales I am paying $23 and earning $50.

Am I over simplifying the above example?

Also, as far as I have read, the only negative aspect of direct linking to an affiliates landing page is the fact that I will be competing with many other affiliates. However, the only effect I can find that this would have on my campaign is that my ad will simply be shown less often. Is this accurate?

Thank you.

[PeteSmith]

Your maths and theory sound correct. Unfortunately it's not always that simple though. Conversion rates aren't always consitent, and often depend on the keywords you used to drive the traffic there. This can determine what mind set they have. But yea, it sounds good to go.

[mainstreetcm]

From a numbers game perspective you are spot on. But... there is a chance you will get 100 clicks, pay $23 and not make a single sale. Those would be variables that you cannot control nor begin to see until after you set up a campaign and go for it.

[Melon Farmer]

PeteSmith and mainstreetcm,

Your replies are incredibly informative. You are essentially telling me that the first step in any ppc campaign is to run the numbers as I did in my example. And from there, all anyone can do is test keywords until a profitable model is found. That information is very valuable to me. Thanks.

To reiterate:

1. Run the numbers and find keywords which project a profit - EPC>CPC
2. Simply test those keywords and tweek campaign verbaige
3. Scale up campaigns which are successful

Terrific!

Anyone have an opinion on the negative aspects of direct linking?

[tryinhere]

Originally Posted by Melon Farmer

PeteSmith and mainstreetcm,

Your replies are incredibly informative. You are essentially telling me that the first step in any ppc campaign is to run the numbers as I did in my example. And from there, all anyone can do is test keywords until a profitable model is found. That information is very valuable to me. Thanks.


To reiterate:

1. Run the numbers and find keywords which project a profit - EPC>CPC
2. Simply test those keywords and tweek campaign verbaige
3. Scale up campaigns which are successful

Terrific!

Anyone have an opinion on the negative aspects of direct linking?

Run the numbers and find keywords which project a profit - EPC>CPC

who's data are you basing the epc on ? what others do could only be seen as an indicator and that is all, for example what if that epc was made up of the 3 stooges who could not sell an ice cream at the beach on a summers day, would you base your own ability to get results on the epc shown ?

direct link will more than often lead to poor quality scores if playing with the big G, this will increase your cpc and as such alter your maths, direct link alone is not the only factor in selecting sites / campaigns.