Here’s a pay-per-click question posted by Steve that I think many NPT readers can relate to…

Dear Rosalind,

I purchased the Super Affiliate Handbook about 10 months ago and have been really applying myself with several affiliate offers. Your book was so helpful, and I have gone from having no clue about how to build a website to learning HTML, CSS, PPC, SEO and all of that good stuff.

However at the moment I am feeling extremely discouraged and really don’t know where else to turn for help. Here’s why:

Every time I use Pay Per Click I get killed. The math just doesn’t work.

For Example, I am trying to market a popular weight loss product from Clickbank. It has a gravity of 747 so it’s obviously selling, and it pays $26.30 per sale. My problem is that the PPC is way too expensive to turn a profit. If an average affiliate converts at 1% that means I have to get clicks for $0.26 to break even. This is simply not possible. Lets assume my landing page is very good and this product could convert at 3%. Then I break even with $0.79 clicks.

I have found one keyword with slow but steady traffic on Yahoo that I can get position 4 for $0.42. Using this keyword as an example, with a 3% conversion rate, I spend $42 on clicks to turn a $36.90 profit. This works, but I will be 86 years old before I make five sales at this rate! I need lots more cheap keywords to get any significant traffic volume and, well, they’re all over $1 per click! The cheap keywords seem to have no traffic volume.

If the Clickbank gravity is over 700 then this thing is selling like hot cakes. What am I doing wrong? If you wouldn’t mind offering some advice I would really appreciate it!

Best Regards,

Steve Anderson

OK, because Steve didn’t provide a link to the landing page for this particular PPC campaign, here’s my general take on the situation, as well as a solution.

First of all, weight loss is a HUGE market that’s increasing in size every day. That’s a good thing for marketers.

However, because the diet / weight loss niche is so popular, you have tons of competition from other marketers and pay per click keyword prices skyrocket, as Steve indicated.

That doesn’t mean you can’t make a profit using ppc advertising to big markets with tons of competition. I personally love playing in big markets.

But you have to play it smart.

And by ‘smart’ I mean that each of the following 3 elements has to be absolutely perfect.

1. Your Ad Copy.
2. Your PPC Bid and Ad Position.
3. Your Landing Page.

Although I can’t write an entire course here on copywriting, bid positioning and landing page copy and construction – I’ll share the essential nuggets.

Ad Copy

First and foremost, ad content must be 100% relevant to content on the landing page. I’ll talk more about that in the Landing Page section below.

Moreover, because you have tons of competiton, your ad has to stand out, so make it unique and personal. So where using “Lose Weight” in the headline will put your ad adrift in a sea of 100′s of other boring “me too” ads, using “How I Lost 89 Pounds” (in quotes) sets your ad apart and makes it more noticeable. That captures the surfer’s attention. They think “I want to know how he/she did that” and clicks on your ad, most without ever reading the rest of the copy.

For those that do read the description, it had better be amazing (‘amazing’ is a good word to use) and enhanced with credibility (as seen on CNN) or speak to a specific timeframe. Speaking of timeframes, those ads that are still promising that you’ll “look great in 2008″ are dead in the water and should be revised to promise that I’ll look simply fabulous in a bikini this summer. Note how the latter is more specific and conjures up a specific image — scarey as that may be?

Bid and Ad Position

NEVER bid the top spot. Lower on the first page is always better both in terms of price and overall conversion rates. People have to spend more time filtering through the top ads to get to the lower regions of the Sponsored Listings, so they prove that they’re more motivated to buy product.

You also don’t want to waste your time having your ad languish on the second page of ads.

Most of all, don’t put your ad up on the Content Network until after you’ve proven that it converts.

Landing Page

I won’t even bother talking about sending traffic to a merchant’s landing page from a PPC ad — in most cases that’s a guaranteed way to put yourself in the hole with PPC advertising. Moreover, it’s a terrible business model.

As stated earlier, your landing page has to be completely relevant to the promise made in your ad. Ergo, if you say that you lost all that weight, I want to read your story, not end up on a side-by-side comparison page of your top 3 recommended weight loss products. I want to see something that looks like a real person is telling their story – not some glitzy, merchant-prepared landing page with high-end graphics that is just too obviously just another ad.

Here’s a screenshot of a landing page that I did for a handbag promotion… note how it’s personal? It got a 6% conversion rate on the PPC campaign.

NOTE: If you need more help with website copy, read my How to Sell WITHOUT Selling article and Ken Evoy’s MYCPS! (Make Your Content PreSell) is available as a free download.

Once you have all that in place, you need to watch your campaign like a hawk. That means testing and tweaking, and testing and tweaking some more until it is converting properly.

But what if you’ve done all of that and it STILL doesn’t convert?

The Main Reason Affiliates Lose Money on PPC!

Well, there’s one more reason many affiliates still end up losing money on their PPC campaigns.

They’re driving traffic to a single-product landing page that in most cases only links out to the merchant’s product.

So guess what happens when the visitor decides that they’re not interested in the product being promoted and doesn’t visit the merchant page?

That’s right. They back-up or close the page.

And that’s the reason that I DON’T teach or advocate using single-product landing pages in the Super Affiliate Handbook.

That’s not to say that there aren’t affiliates who use this technique successfully. There are. But relatively speaking, their success rates are lower than those of us who use the content model. Moreover, they work very hard to build out each and every campaign, in some cases only producing one campaign every 3 months. Then, the law of diminishing returns comes into play when other affiliates find out about a newly successful PPC campaign and they pounce to promote the product. (See below for how they find out about those successful PPC campaigns.)

Compare that with having your visitor land on your blog and when she decides that she’s not interested in pursuing the original product further, she sees that there are many more options relevant to her interests that she can peruse through links in your sidebar. So, she clicks on one of those links and because you have informative content on your site, she sticks around longer. Google likes that and gives you higher rankings for keeping your readers’ interest.

She sees that you have a newsletter and because she finds your content interesting, entertaining and of such value, she decides to signup. Yippee!! You can now market to her again and again.

Lastly, of the products listed on your site, she finds one that she likes and buys it.

Amazing how that works and here’s why…

We like having options.

Can you imagine wanting running shoes and ending up in a store that sold only one brand and one style of shoe? Ugh. Wouldn’t you prefer to offer your visitors a nice array of products from which to choose and also have the option of selling them something even bigger — like maybe a treadmill?

Ultimately, when you have a content site, your PPC dollars go a lot farther by increasing the number of visitors who stay longer (which raises your rankings and brings MORE visitors) and you’re building a list.

Need traffic?

Pay-per-click search engines are the best way to satisfy that need. However, with several hundred pay-per-click search engines to choose from across the web, it can be confusing to know where to start advertising first.

Too, some internet and affiliate marketers are afraid of losing money through pay per click advertising.

Well, here’s what I have to say about that. I’ve been using PPC advertising since it was introduced and spent an ‘excessive’ amount only once – and only by result of acting stupidly. There’s absolutely NO way you can spend too much when you set a budget. Simple as that.

About 60% of my traffic is generated through pay-per-click search engines – and the ‘secret’ here is that when you drive traffic initially to your site using PPC’s, the search engines notice your site (because it’s now getting traffic) and your site will rank higher than it would if you weren’t getting PPC traffic.

The best PPCSE’s (pay per click search engines) offer account signup bonuses. Take advantage of these to get hundreds of dollars in free traffic to your site.

Listed below are the very best pay per click search engines for delivering high-quality, targeted traffic at reasonable prices.

1. Microsoft adCenter
2. Google Adwords

I’ve also listed other PPC seach engines at which you should consider advertising.

Top PPC Search Engines

Check in on this page every now and then to find out which of my favorite pay per click search engines are offering deals and discounts for new advertisers.

Microsoft AdCenter

Microsoft AdCenter is best for those affiliates in more mature niches and you can get started with only $5.

Open a Microsoft adCenter account.

Google Adwords

Google Adwords often offers $50 in advertising credits for new AdWords customers with self-managed signup. The offer is based on a $55 total credit, which represents $50 of advertising credit and a $5 activation fee.

Sign up for a Google Adwords account.

Money-Saving TIP: If you don’t see a credit offered on the direct link to Google Adwords and you need a hosting account, Bluehost almost always has an Adwords promo going on for their new customers… AND you’ll save the domain registration fee.

According to Jennifer Slegg over at Jensense.com, webmasters with MFA (Made for Adsense) sites are getting emails from Google stating that their business model is unsuitable and that their Adsense accounts will be disabled as of June 1st.

WOOHOO!!! YeeHA!!! and it’s about time!

FYI – Webmasters with MFA sites send quanitites of inexpensive pay-per-click traffic to their sites for the sole purpose of having visitors click their Google Adsense or other contextual advertising network ads such as the Yahoo! Publisher Network (YPN). The business model is known as arbitrage.

These sites contain absolutely no content. No informational articles, product endorsements, news or anything else a good affiliate / publisher would place on their site.

Here is a graphic image of a site that came up after searching for ‘running shoes’ at at SearchFeed.

This is only a portion of the page, but the whole page consists of nothing but Google Adsense and other links fed from contextual advertising networks. The navigational links point to more of the same.

So, why am I gleeful that these guys are getting shut down?

Well, as someone who uses the Internet to shop, these sites are absolutely useless and a total waste of my time. It gets increasingly frustrating when you click on one of the ads on these pages and end up on another arbitrager’s site. Groan. (I’ve made it a policy to never click on these ads.)

From an advertiser’s perspective, these guys cost me money by bidding on keywords for which they provide no useful content. With them gone – it should be easier to bid higher positions without additional cost.

Furthermore, I haven’t put my Adwords ads on Google’s content network for ages because traffic from the arbitragers’ lousy sites is complete garbage. When people click any ole link on a site just to get off that site – that hardly qualifies as targeted traffic. It simply burns up your PPC advertising budget in a hurry and you get almost nothing in return.

Basically, once the arbitragers’ Adsense accounts are terminated and I know my ads will show up on decent sites that offer great relevant content, I’ll start placing my ads on the content network again.

We’ll see what happens.

Just in case the notice went straight to your Junk folder, Google Adsense is now offering Electronic Funds Transfer starting with your your next AdSense payment.

To get on board with EFT, and have your Adsense earnings paid directly to your bank account, you’ll have to login to your Adsense account, visit the Payment Details section of the My Account page, then click Edit and select the EFT radio button.

After that you’ll need to verify a couple of test deposits that Google makes to your bank account and you’re all set to go.

Login to your Adsense account for more information about EFT.

Unlike Joel Comm, I’m not a Google Adsense guru. I’ve never tried to become an Adsense guru, as I’ve always believed that earning a percentage of product sales as an affiliate was preferable to earning a percentage of a click on an Adsense ad. Too, I was worried that sending visitors away from the site through Adsense would decimate my product sales as an affiliate. Lastly, I didn’t want to eat up too much site real estate by displaying a bunch of obvious ads.

Well, my stance has changed completely. During December, my Adsense earnings increased by a whopping 512% over the previous month. As you will see in the screenshots included, November’s earnings were $292.98 while December was $1500.06. Page impressions, Clicks, Page CTR, and Page eCPM all increased as well.

The increase is particularly remarkable from the standpoint that I did not set out to increase my Adsense earnings. As a matter of fact…

• As part of a traffic quality test, I actually suspended a pay per click campaign that had been delivering 2000 – 2500 clicks per day to Sage-Hearts.com.
• I also removed the Adsense ads displayed at the top of the pages at Sage-Hearts.com.
• Product sales during the period actually increased as well.

So why did the earnings increase so much?

Well, I simply sent a few more newsletters to my online dating newsletter subscriber list than usual!

Each newsletter contained links to one or more blog posts that were of interest to my visitors but that did not promote a product. After perusing the article, readers would then move through the site via the standard navigation to view product offers, or leave the site via the ads. I was making money either way!

By displaying only one unit of Adsense ads, I was also earning more per click as Adsense ad values decline with each subsequent placement.

Lessons learned… The beauty of using Adsense to monetize your site – or a particular portion of your site – is that it should free you from the compulsion to promote a product every time you send a newsletter.

Furthermore, when your newsletter readers don’t feel that they are being ‘pitched to’ each time they hear from you; they’ll trust you more, stay on your list longer and ultimately you will stand a better chance of making that sale when you do promote a product.

As the old saying goes – The money is in the list. Build it big (with Aweber) and then make the most of it through diversified monetization channels.

Now that makes sense! Adsense.