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Doing the math... Is it right?

by Uberam
14 replies
Hi all,

I'm doing the math on my first digital product launch and I'm not sure if these figures make sense. If someone could look and advise, I'd be very grateful:

So, my product will sell for £50. I have given myself a target of 100 units to sell, with a cash target of £5000.

I'll aim for a sales CTR of 10% (my understanding is that taking a prospect through a Jeff Walker/Kern style launch process, this is doable).

With this in mind, I will need a list of 1000 people - 10% sales would give me my target.

Building the list is where my head starts aching.....I've read that an opt-in figure of 20% is common from traffic from ads. If this is true, then I need 5000 clicks - so 20% of that will give me my 1000 people list target.

My main way of generating traffic would be by clickable ads - but I'm thinking how much 5000 clicks will cost - that'll be expensive, no!? Even it its 50p per click, thats a total of £2500 on ads - giving an overall profit margin of 50%.

Is that good? Bad? Average?!

As you can tell, I'm a noob - I also got a D in math at school, so sorry if this doesn't make sense.

Any thoughts appreciated! Very much open to the idea that I am very wrong on my approach here...

Thanks guys,
#math
  • Profile picture of the author Istvan Horvath
    Yes and no.

    What you've described above is just ONE possible way to do it.

    It is not necessary that you build a list only to be able to convert 10% of them into buyers. You could attract affiliates/JV partners and achieve your sales/profit numbers while building a smaller list - but all verified buyers!

    Also, in the real world the sales conversions are, usually, below 10%... especially for an unknown newcomer. On the other hand, having way higher optin rates when getting subscribers is possible - although not all of them would become buyers.

    Other vendors' hard numbers are difficult to apply to someone else's funnel.
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    • Profile picture of the author Uberam
      Thank you for that.

      Are there any guides I could read on building affiliates/JV partners that you know of?
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      • Profile picture of the author luke14
        If you want to build good JV and affiliate partners I would defiantly check out JVnewswatch.com
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        • Profile picture of the author Uberam
          Wicked, thanks!
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          • Profile picture of the author luke14
            thats no problem, happy to assist
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      • Profile picture of the author Istvan Horvath
        Originally Posted by Uberam View Post

        Are there any guides I could read on building affiliates/JV partners that you know of?
        Don't over-complicate it: a lot of selling platforms (from Clickbank to JVZoo and Zaxaa and Digiresults...) have built-in affiliate programs. Just be careful when accepting them. The "built-in" in this case means users of the system always look for new products to promote.
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      • Profile picture of the author savidge4
        In essence, yeah the math is right, in a perfect world. How your sales copy works is another variable.

        Let me ask you this. Your goal is to sell 100 units correct?

        Your goal and your method of getting there is kinda out of whack.

        I am assuming you are starting fresh, no traffic, no list ( that's why you want to build one ) and you want to sell 100 units.

        So you are going to build a site, you are going to use click ads to get them there, 5000 of them to boot to get a list started, you then in turn are going to put 1000 people on a list, then sell the 100 units.

        Seriously

        ok so you are going to draw 5000 people in, to convert 1000 to sell 100. Do you have another product in the wings? what happens when you sell the 100?

        You have thought through selling the 100, but then what do you do with your list? You need to plan out a bit further than next week. $5000 is just peachy. but that's where the plan stops. You are developing a business. You are starting a brand. You are creating long term relationships with your list. You are should be looking beyond today.

        Do you see where this is going... for 2 seconds think past the $5k you need today and look at the $100,000 you could make next year! PLAN AROUND THAT. long term planning creates LONG TERM SUCCESS.

        Hope that Helps!
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        Success is an ACT not an idea
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        • Profile picture of the author Uberam
          Thanks for all of that! Very useful indeed - will go back to drawing board in that respect.
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    • Profile picture of the author Brandon Tanner
      Yeah, a 10% conversion rate is definitely on the high side. I would guess that less than 1% of all digital products out there have conversion rates that high. While it's most certainly possible to get that kind of conversion rate (and even higher), you're probably not going to be able to attain that unless...

      * Your leads are super warm / targeted

      * You've built up a lot of rapport / trust with your list over time (ie by giving away valuable stuff for free, etc.)

      * You've done a great job segmenting your list into only those who you think have the best chance of actually buying your product (ie "if you'd like a massive discount on my product when it comes out, along with special bonuses not available to the general public, then sign up to my VIP list...")

      * Your sales copy is really good, uses all of the best conversion tactics, and your product is priced right

      And all of that assumes that you are even in a good niche to begin with (a niche with plenty of buyers).

      In other words... laying the foundation for a double-digit conversion rate takes a LOT of work, but it is most certainly possible.
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  • Profile picture of the author Taviuss
    Regarding your subscribers, I would also suggest that you avoid the opportunities that say they will get you a ton of leads for cheap.
    Generally, those are often useless leads.
    What you want are directed leads, applying to your own prospects.
    As mentioned above, your conversion rate will vary, so you just need to look around - and realize that most things that are good quality are often reflected by the price.
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    Tavius Southard
    What would an extra $17,342 a month do for you?
    Find out the 3 steps that has helped others!
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    • Profile picture of the author Uberam
      Thank you. Very glad I posted. You guys are very helpful.
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  • Profile picture of the author travlinguy
    Too much info missing. £50 = $82, a fairly high ticket item. 10% is likely to be very unrealistic for your first launch. Experienced marketers drool over such numbers. Another thing, you talk about a list and then you talk about clickable ads. Are you presenting this offer to your list (or list you intend to build) or are you building your list from clickable ads? Again, too much missing info to comment.
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    • Profile picture of the author Uberam
      Fair points.

      I am intending to build a list from clickable ads.

      I've tried to as much research on list building as possible - not found a great deal that has been inspiring. Looked for Kern's List Control but as I understand its not available.

      The product is aimed at an affluent niche - done quite a lot of research in that particular area.

      Any thoughts welcome
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  • Profile picture of the author Istvan Horvath
    I have to agree with travelinguy: lots of missing info.

    You seem to plan to build a list just for the sake of having a list. So I am going to repeat myself: you do NOT need 1,000 on a list just to have 100 buyers!

    Target your ads to potential buyers and build a buyers list. Or, eventually, for non-buyers (wanting to leave the page) offer an 'ethical bribe' - e.g. a related report, ebook, something - to join your prospects list... and warm them up with an email series and then try to sell them the original item again
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