Recently, HostGator — my Web hosting provider — sent a card in the mail giving me a $100 credit to try Google AdWords. This encouraged me to do a bit of experimentation, which I’ll post about in the future. Today, though, I’d like to write a bit about the process of evaluating the feasibility of a potential AdWords campaign.
Although AdWords is a great idea for businesses with a product or service to sell, it may not always be the best idea for affiliate marketers. After all, with most affiliate programs, you’re looking at just a few dollars for each successful conversion, and the conversion rate may be quite low. Is your affiliate website a good fit for AdWords? Let’s take a look. We’ll start with a few hypothetical figures, which you can modify for your website.
Let’s suppose that:
Using these figures, you will pay $20 for every 100 visitors that your website receives through AdWords. However, your average conversion rate will net you just $16 for every $20 that you spend. Using AdWords is probably not the best way to market your website. However, what if you lowered your bid to $.10? In this case, every $10 spent would net you $16. That sounds like a much better deal.
Of course, when evaluating your potential AdWords campaign, you will need to know whether the amount of money that you want to bid will actually result in your ad being displayed. The Google AdWords Keyword Tool can tell you this.
As you can see, if my keyword phrase is “proofreading service,” and my maximum bid per click is $.10, I’m out of luck. In fact, I would have to bid upwards of $1.00 per click just to crack the sixth ad position for this keyword. The AdWords Keyword Tool can help you determine whether your potential AdWords campaign is feasible given the amount of money that you are willing to spend and what you can potentially earn from affiliate conversions.
Lastly, before starting an AdWords campaign, ask yourself these questions:
You should make sure that you have clear answers for all of these questions before starting an AdWords campaign.