Hight Ticket vs Low Ticket Affiliate Sales?

10 years ago

If you can generate the traffic, the higher ticket items are much more profitable. Even if the conversion rate is much lower, the payout on a $100 affiliate commission is far superior than a $2 CPA offer. Compare driving 500 visitors to two different offers:

1% conversion for $100 commission: 5 commissions = $500

10% conversion for $5 commission: 50 commission = $250

I struggle with this all the time for offers that have a lead generation or conversion option. Usually I go with the lead generation until I can see how well my leads convert, then I decide to switch to the conversion option or stay with leads only.

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kilgore

10 years ago

Originally Posted by unifiedac

If you can generate the traffic, the higher ticket items are much more profitable. Even if the conversion rate is much lower, the payout on a $100 affiliate commission is far superior than a $2 CPA offer. Compare driving 500 visitors to two different offers:

1% conversion for $100 commission: 5 commissions = $500

10% conversion for $5 commission: 50 commission = $250

Where do these numbers come from? Anyone can make up numbers that supposedly prove their point. For example, in my imaginary world, low ticket items are much better than high ticket items because the conversion rates are so much better. Compare driving 500 visitors to two different offers:

0.2% conversion for $100 commission: 1 commissions = $100

98% conversion for $5 commission: 490 commission = $980

There. I just "proved" that low ticket offers are better, right?

Hopefully, nobody looks at my numbers and thinks they have any bearing on reality. But hopefully nobody looks at your numbers and thinks they have any bearing on reality either. They're just as made up as mine are.

Moreover, why would you assume that the amount of traffic you're going to be able to drive to a high ticket offer is the same as the amount of traffic you're going to be able to drive to a low ticket offer? That's almost certainly not the case as in general many, many more people are interested in low ticket items as are interested in high ticket items.

Getting back to math, this formula more or less represents how much revenue an affiliate will generate:

Number of Visitors * Conversion Rate * Price of Item(s) * Number of Items * Commission Rate = Revenue

When talking about high ticket vs low ticket items, you're really talking about the item price. But that really only tells you one piece of the puzzle. Usually (though not always!), it's easier to drive more visitors to products with lower prices; lower ticket items also usually (though not always!) have a higher conversion rates; you're usually (though not always!) more likely to be able to sell multiple low-ticket products than multiple high ticket products. As for the commission rate, I personally haven't found much relationship between commission rate and the price of the product -- though I will say that as with high ticket products, products with higher commission are usually (though not always!) associated with fewer visitors, lower conversions and fewer sales of multiple items.

So does all this mean that low ticket items are better? Of course not. It just means that you need to do your own work; you need to understand your own market, your own business, your own customers. Personally, I love my low ticket items -- but that's because it fits what with my customers are looking for and what my business is able to deliver. The OP seems to be doing well with high ticket items. Great, he should continue with that. There's no right or wrong answer here; this is business, find what's right for you. (Just don't use made up math to make your decisions!)

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unifiedac

10 years ago

Originally Posted by kilgore

0.2% conversion for $100 commission: 1 commissions = $100

98% conversion for $5 commission: 490 commission = $980

There. I just "proved" that low ticket offers are better, right?

Hopefully, nobody looks at my numbers and thinks they have any bearing on reality. But hopefully nobody looks at your numbers and thinks they have any bearing on reality either. They're just as made up as mine are.

Moreover, why would you assume that the amount of traffic you're going to be able to drive to a high ticket offer is the same as the amount of traffic you're going to be able to drive to a low ticket offer? That's almost certainly not the case as in general many, many more people are interested in low ticket items as are interested in high ticket items.

I think you missed the point. And I love it when people try to correct others with incorrect math. Your formula SHOULD read as follows:

Number of Visitors * Price of Item * Number of Items * Commission Rate = Revenue

Conversion Rate is the result (quotient) of Number of Items/Number of Visitors. It's only used as a gauge for how effective your ads, traffic generation, or on-page content is. If you use conversion rate as a factor, your actual revenue calculation will be wrong. When I used your math, I earned $20 for 20 sales of a $30 item with 50% commission. LoL

--------------------

The reality is, if you look at even the best selling products, they usually have a <15% conversion rate, which is why my example is more in line with reality. My argument, and experience, has shown me that even a 2% conversion on a $100 item pays much better than a 15% conversion on a $5 item (Also confirmed by the OP). There is no comparison with high ticket items when you get up to a 10-15% conversion rate for them, even if you had 10X the traffic to a lower ticket item.

Of course what you say about traffic is true. If I only send 1 visitor to my $100 product and 1,000 to my $5 product, the low ticket item will probably out perform. But I wouldn't choose products I can't promote or send traffic to, so not sure there's really an argument there.

https://www.udemy.com/easily-learn-basic-math/

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Frank Donovan

10 years ago

Originally Posted by hardworker2013

Please give me your opinion and what is currently working for you.

Why? You've already stated that after testing your market, selling high ticket products works well for you. So stick with what's working.

You're likely to get a mixture of responses to your question depending on what other people's preferences and markets are, and you'll just end up back where you started.

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SiteNameSales

10 years ago

If you can invest in advertising then the answer is clear - at least to me. I've been doing some form of internet marketing for more than a decade and the cost to use Google Adwords or Bing has skyrocketed over that time.

Yes, there are ways to work with various keywords and there are some financially conservative strategies that can work, but that greatly depends on the product.

Simply put, the profit margin on a high ticket course or product is most often considerably greater than on a low cost item.

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discrat

10 years ago

ALWAYS do high ticket no matter what.... because we know how miserably Wrigley has done selling those silly $.25 packs of gum

- Robert Andrew

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shmol 10 years ago

Originally Posted by discrat

ALWAYS do high ticket no matter what.... because we know how miserably Wrigley has done selling those silly $.25 packs of gum

- Robert Andrew

Love this!

But seriously,

I think you have answered your own question

You are having success right now selling high ticket items,

Why change?

What you should focus on now is how to scale this up.

Can you build a large content site around one of these products, a site that will be able to suck in a lot of traffic.

Can you build a list around these offers--and then continually sell to them over and over.

Hope this helps.
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spartan14

10 years ago

I dont have experience with tickets but i prefer the big bucks .For example i was using cpa and i was geting like 1.60 per conversion but when i switch to clickbank i get 30$ per transaction

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EPoltrack77

10 years ago

I like building a contact list and monetizing my front end with low cost products and as I build a relationship I can market higher ticket items. In the end it's my list!

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mdallen

10 years ago

If it is working don't try and "fix" it. I have heard a good method is to start by giving them free (with upgrade options) low price and increase the price point to the top price point you offer.

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DIABL0

10 years ago

I would consider doing both, until you can confirm that your last 2 weeks wasn't possibly a fluke???

Personally, my core business is promoting PPL (pay per lead...lead generation) offers because there is no credit card / purchase required. All a user has to do is fill out a short form, so conversion rates are typically much higher than offers that require a sale.

Which the bulk of the offers I promote pay $20-$40 per lead. So all commissions are low dollar, just it is possible to produce high volume.

Been doing it for 16+ years and no plans to ever stop.

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talfighel

10 years ago

For years I thought that high ticket is very hard to sell from a small bad experience back in 2009.

A few years later, I was promoting a product that earned me $500 one time commission. Showed me that it is possible to make more money with high ticket products.

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Leli

10 years ago

It all depends on conversion rates and competition. In general however, it is indeed easier for the average marketer to make a good income with low priced offers rather than high ticket ones.

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Edwin Torres

10 years ago

High ticket offers you better have a strong relationship with your email list, be a celebrity in your industry (so you can demand those prices), or be a marketing badass and cultivate that "celebrity appeal" while also driving insane amounts of traffic to an offer.

It's much easier to make money with low-ticket sales.

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talfighel

10 years ago

Originally Posted by Edwin Torres

High ticket offers you better have a strong relationship with your email list, be a celebrity in your industry (so you can demand those prices), or be a marketing badass and cultivate that "celebrity appeal" while also driving insane amounts of traffic to an offer.

It's much easier to make money with low-ticket sales.

Not true.

You can get someone on your list on Monday and he/she decides to buy the front end product on the same day.

Then on Tuesday, they buy the high ticket and product and you earn the commission.

It happens ALL the time.

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unlimitedoptions

10 years ago

Hi: With an established list or audience, using high ticket offers make absolute sense. However, with a new list or buying solo ads it will probably be much more difficult to get a high conversion rate. As you undoubtedly already know your list/prospects usually need to know, like and trust you. Especially if you are asking them to drop $1000 on a product.

Great conversation though. Thanks,

Dan

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gwilfo1988

10 years ago

I work with a sales funnel that promotes great products. We aim to give 5x the value of what it costs to prove to our customers we that we can be trusted and put out great products and services.

From there we develop a close relationship and sell back-end offers from $1,995 to $25,000 and also $47 a month subscriptions. There would be no way on earth these could be sold without the great value of the front-end product.

The money made from the front end is usually what it costs to pay for the traffic in the first place. So yes, the back end is needed. But it goes hand in hand with the front.

Hope this helps

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djayturner85

10 years ago

Both have there advantages and disadvantages like for example with low ticket items you will usually get better conversion rates. The most important thing in my opinion is to only promote quality products.

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RefuseToLose

10 years ago

There is no right or wrong answer.

You could have 50,000 people coming to your website everyday and if you advertise a high ticket product you might never sell one.

But if you put an offer for an email submit offering your visitors a free giftcard. You will get a 1-5%+ of them to bite.

The lesson here is it's all about the traffic.

And the #1 rule I've found is the more expensive it is, the more selling you will have to do. UNLESS you catch the person in a buying mode ready to purchase a product. Then you just need to nudge him in your products direction.

So two key takeaways here.

1. The price of the product doesn't matter.

2. What matters is the traffic, where it comes from, and what state of mind that traffic is in. Depending on these factors the amount of selling required to secure the sale will differ.

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DABK

10 years ago

You forgot to tell how many conversions you had with the first option and how many you had with the second. I'm going to venture that 100 conversions at $1.60 is $160 while 2 conversions at $30 is $60.

Originally Posted by spartan14

I dont have experience with tickets but i prefer the big bucks .For example i was using cpa and i was geting like 1.60 per conversion but when i switch to clickbank i get 30$ per transaction

That in no ways means that the prospects don't have a good relationship with the list owner. Just that they buy a low-priced item on one day and a high-priced item a day or two later.

Originally Posted by talfighel

Not true.

You can get someone on your list on Monday and he/she decides to buy the front end product on the same day.

Then on Tuesday, they buy the high ticket and product and you earn the commission.

It happens ALL the time.

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jamescanz

10 years ago

Well, if you made that much in that amount of time...

And you compare it to how long it took you to make sales with low ticket items...

It should be a pretty easy decision on which type of offer works best for you

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YourBizAid

Banned 10 years ago

If I could turn back the hands of time and start internet marketing again, I would start and end with selling high ticket products and services. That's where the money is.

Selling low ticket products should only be means to an end, which is a funnel that leads low ticket buyers on to high ticket purchases.

It's been proven that the same amount of marketing energy spent in selling a low ticket product is almost equivalent to the one put into selling a high ticket offer.

That's food for thought.

Good luck.

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hardworker2013

10 years ago

I think i should make it clear that i do not suggest this for newbies until you have gained some experience about Internet marketing. If i had started doing high ticket items from the beginning i perhaps have made no money and have given up on IM. Over the first couple of years i was able to build a sizeable email list by selling low ticket Im products. Because of the trust factor i had build up with my email list over the years, i was able to pitch these high ticket items to them. So the lesson here is that i do not think High Ticket Items is the way to go for Newbies to Internet Marketing.

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latic

10 years ago

All business is a gamble. Do you want to put your money into a low odds bet quite often and get a little bit of money back or do you want to bet on the longer odds and hope one comes in!

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namehero

10 years ago

Originally Posted by hardworker2013

From i started Internet marketing over 6 years ago it has been said that you make more commissions from selling low ticket items rather than high ticket items. That is because low ticket items usual gets more sales. However in recent times i have earned more money from selling high ticket items with commissions which pays up to $1000 per sale. In a recent high ticket launch i made over $10,000 in just 2 weeks. This is more than i have made selling low ticket items over the past year. As a result i have concentrated my focus mainly on promoting high ticket items with commissions over $500 per sale.
What do all think about this approach? Please give me your opinion and what is currently working for you. Best wishes for 2017!

I've been doing the same thing.

I like to have many "micro niches" where I can laser target my audience to add a personal touch to my promotions!

Promoting lower ticket items you have to become so "generalized" I feel like it's been overdone in recent years.

Especially with social media you have to be prepared to get personal with your audience!

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alexhan

10 years ago

Personally, I think it will depend how expert (probably guru type) you are. If a newbie want to sell a high ticket product. He will facing a hard time to convince his customer. However, low ticket will be much more easy for the newbie.

Once the newbie gain some experience and becoming guru. Most probably he got some reputation, followers and etc. He will has more confident and convincing power to close the high ticket product.

So..this is how I look at it.

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TechDigitals

10 years ago

Since you opined that you're doing well with high ticket items. Then, you should continue with that.

Why do you want to change it if it ain't broken? Just curious...

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AffiliatePrograms

10 years ago

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myob 10 years ago

I have always focused on selling high ticket products (4-5 figures on Amazon, etc), but quite often it does take leveraging the qualifying process through a series of much more nominally priced offers.
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Dr Dan

10 years ago

We were some of the first on Warrior Forum to sell higher ticket. I remember back then... the most people charged was $7 to $20.

I laugh today when affiliates back then said they couldnt promote our product on WSO because their list wouldnt buy higher ticket at $49-$69...haha

Today we sell most of our stuff at the $1,000 price point and focus on recurring as well. Every now and then we will sell something for $200 when promoting someone else. But we dont go below $500 99% of the time.

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JohnMcCabe

10 years ago

I've used this analogy before, about a slightly different form of "affiliate marketing" - residential real estate.

In my neck of the woods you'll find everything from $50K condos to $10M estates. Nearly all are sold by "affiliates" selling on commission.

If you watch the listings, you'll see that the various agents tend to sort themselves out by price. The agents mainly promoting $50K condos and $150K homes don't promote the $1M plus homes and condos. The agents that specialize in high end homes rarely, if ever, promote lower end properties. I'm aware of people who have been working in both niches for many years, and I get two takeaways from what I see.

First, if both have been around and actively working (paying for ads, etc.) for several years, they're making commissions. They'd either quit or be fired if they weren't.

Second, I can't think of an example of an agent that's gone from high to low or low to high. Once they establish their place in the marketplace, they tend to stick to it.

So, to force another analogy, decide who you want to be. Do you want to be Aldi's or Whole Foods?

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