Unleash the Beast – Part 3

This is the last in a 3-part series on analyzing online media quality. It’s a doozy,
but an in-depth look. If you missed the other installments, here’s Part 1 and
here’s Part 2.

The Sophisticated Approach
The sophisticated advertiser distinguishes between media sources and offers
a different CPA for each of them. Let’s take a simple example, an advertiser that
sets CPA at 3 levels:

• $5 for regular traffic
• $2 rate for incentivized traffic
• $6 premium rate for SEM traffic.

In this example, all the traffic sources will run this offer, and the ROI will be

positive for all the sources.

In this way, 5 different levels can bring the advertiser up to $300,000 profit from
160,000 users.
Let’s summarize the profit for each advertiser:

This model works not only in theory. In my experience working with advertisers at
Adsmarket, I’ve seen many empiric example of how advertisers dramatically
increased their revenue and their profit by handling and monitoring the traffic
sources better. This brings me to two major conclusions:

1. There is no “Bad Traffic”. You need to find the right payout for each source
   in order to take advantage of its full capacity and potential, “Unleashing the
   Beast”.
2. By monitoring and optimizing media sources the advertiser can increase
   profit by hundreds of percents, “Controlling the Beast”.

Feel free to contact me at Yuval.bATadsmarket.com to learn more about these tools
and about traffic source optimization in general.

Tips for the Most Conversions: Ad Size

This is a guest post by Gal Topaz, an account manager at XTEND. You can view
XTEND’s blog here.

Hi Adsmarket Blog Readers,

This being my first guest post for the Adsmarket Blog, I wanted to make sure my
experience working with an ad network like XTEND would contribute to the
audience of an affiliate network like Adsmarket. There are so many things that ad

networks and affiliate networks have in common! So, to start off, I wanted to share
with you my thoughts on their recently released “Global Benchmark Report 2009″,
which, in summary, finds that bigger is not always better when it comes to ad size.

Interestingly, Eyeblaster found that standard banners achieved an average
click-through-rate of 0.1% worldwide, compared with 0.3% for rich media ads. So
if used correctly, the rich media banners have a much higher ROI. From our
experience on XTEND’s ad network, bigger banner sizes have always been equal
to higher click-thru-rates and better performance. This trend was also found in a
study conducted by the IAB [i]. It was found that larger ad units are 25% more
effective in key metrics.

I can use XTEND as a recent example. We are seeing increasing numbers of
Publishers that are offering larger and larger ad sizes in the hope of increasing
their revenue. Advertisers (assuming they have a limited budget and resources)
are facedwith the decision to invest in larger-sized regular banners or rich media
(which, due to their interactivity, make the creatives more appealing).

Of course, size does have an impact on rich media banners but it is not the best
indicator for their performance. What we came to realize is that when adding rich
media to banners, ROI may improve, but the equation becomes more complex.
The report indicates that the effectiveness of rich media banners has much more
to do with creative and placement than it does with size.

What is important about this report is the performance trade-off between size and
creativity. To add a personal note from my experience, I think content is the name
of the game. Size is never as important as a good creative, so I suggest spending
more time creating original content and detecting online trends. Stay simple in
creative and have users put their imagination to work for you.

[i] 1 Interactive Advertising Bureau (IAB). Available at: http://www.iab.net/about_
the_iab/recent_press_releases/press_release_archive/press_release/4426

Unleash the Beast – Part 2

This is Part 2 in a 3-part series on analyzing online media quality. It’s a doozy,
but an in-depth look.
Did you miss Part 1? Click here.

In Part 1 of this series, I introduced the 2 Qs Formula for revenue and profit:

Revenue = Quality*Quantity

Profit = Quality*Quantity – Price*Quantity = Quantity*(Quality – Price)

Let’s take a numeric example:
Let us suppose in a certain market the following table represent each media source
quality (in life time user’s value), capacity (the number of users they can generate)
and the minimum CPA they want in order to run.

This is only an example, in different markets the order of the media sources may be
different depend on the criteria of the users and the type of the product or service
you provide. However, there are several assumptions that are almost always true

(but not always):

• Targeted traffic has less capacity but higher value.
• The best traffic, quality wise, is the most expensive one.

So, let’s take three approaches to the market described in the table above.

The Unsophisticated Approach
An unsophisticated advertiser can’t distinguish between the different media sources,
he sees all the traffic he gets as a one and tries to set one CPA that will fit all. The
traffic he gets is all the traffic that requires a minimum payout that is smaller than the
CPA.

Here is the sensitivity analysis of this advertiser:

Media = all the media that the Minimum CPA (i) required is smaller the CPA the advertisers offers.
Example – for 3$ CPA only the Pops and the incentivized traffic will agree to work.

Total traffic = the sum of capacity of all media



Revenue = the sum of the capacity of media times quality

(Average Quality = Revenue/ Total traffic
Cost = Total traffic x CPA
Profit = Revenue – Cost)

As you can see, the maximum profit for the unsophisticated advertiser is by setting $3 CPA
he gets 100K users with profit of $80K. He is only uses 62.5% of the capacity of the media
and losing all the high quality traffic.

Stay with me here…

You can also see that the average quality is a logarithmic function of the CPA:

*The “X” axis is the price and the “Y” axis is the quality

The green line is the “Break even” line when Price = Quality.
For CPA higher than $5 – Price > Quality and the advertiser loses money.

The Semi-Sophisticated Approach

The semi-sophisticated advertiser usually sets one CPA to all media sources but he
adds restrictions that don’t permit low quality traffic to run. Let’s take for example
advertisers who don’t allow incentivized traffic to run their offers. In this case, their
sensitivity analysis will look like this:

In our example, by not allowing incentivized traffic, the advertiser get more profit

than the unsophisticated one ($100,000 instead of $80,000) but uses only 43.75%
from the traffic available.

Go to Part 3…

Unleash the Beast – Analyzing Media Quality

Contributed by Yuval Ben-Harush, Director of Advertiser Relations

This post is divided into three parts. 

Very often I use the word “Beast” to describe the World Wide Web. It is an

amazing advertising platform that can bring you unbelievable quantities of

customers, from all over the world, at all ages, genders, and socio-economic

levels. Unleashing the beast, meaning using all the traffic sources available,

can bring you, as an advertiser, millions of impressions and hundreds of thousands

of potential clients every day. That’s a fact.

The problem is that this Beast can eat you if you fail to control it. I have seen it

happen that failure to monitor, optimize and control traffic can cause companies

to lose a lot of money.

The Two Q’s Formulas

In order to understand better the beast model, let’s go back to the science of

performance: The two parameters that control the revenue are the two Qs:

Quality and Quantity. From that perspective, “Quantity” is the number of users

(the conversions) and Quality is measured by the users value ($$$$)

Revenue = Quality*Quantity

Profit = Quality*Quantity – Price*Quantity = Quantity*(Quality – Price)

As you understand, in order to maximize revenue and profit we need to maximize

the two Qs. Of course, in order to make a positive profit the following equation

must exist:

Quality > Price

The challenge begins when unleashing the Beast. Working with the large quantities

required from large networks (like Adsmarket) that contain a variety of media

sources, each media source brings a different user value (quality), has a different

capacity (quantity) and asks for a different CPA (price). The unsophisticated

advertiser, the one that does not know how to control the beast, might decide

on a uniform price for all the publishers based on the average quality of users; in

this way he prevents good, high quality publishers from running his offers.

Go to Part 2… and stay tuned by signing up to

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What’s in Your User’s Mind?

This is a follow-up article from Yuval’s first post, The Science of Performance, Explained, posted on October 3rd, 2009.

In my last article, “The Science of Performance, Explained ”, we discussed the most important parameters for publishers in order to make your offers as an online advertiser attractive and to generate high volumes of traffic. One of the parameters was the offer conversion rate. High conversion rates are not only in the interest of the publisher, they need to be in the interest of the advertiser as well. Relevant users need to be converted into action quickly and easily in order to optimize traffic and decrease marketing expenses.

Many books, articles, posts, and eBooks have been written about how to build a good landing page. This is not my intention for this article (but later on I do give you some tips…). I want to discuss with you my way of reviewing, analyzing and building an offer.

The first master rule in building an offer I learned from a very big Israeli affiliate: “Think like a first time visitor in all of your offers”.
You are probably saying now: “This is obvious, tell us something we don’t know”, but unfortunately, most of the advertisers don’t follow this online marketing rule.  I review hundreds of landing pages every month and I can tell you that 90% of them can convert much better with a few small changes.

So, let’s talk about the users:
The user is exposed to a lot of data while he surfs the web. There are many so many options! The number of web pages is almost infinite, he sees dozens of banners with every visit, gets more than a few marketing mails every day and every search he does in Google shows hundreds of millions of results.
This causes a very severe users symptom – they are impatient! The average user visit on a web page is less than 5 seconds!
Users have their trigger fingers on the mouse over the “back” button before they see the content of the page, and are moving forward to the next page (BTW, many statistics systems don’t even count fast-bouncing users, so don’t count on them to see the stats of your landing pages).
The user asks himself 2 questions when he visits your site (in this order):

1. What’s in it for me? – Why should I stay in this website? What can I find here? What’s my incentive?
2. What do I need to do? – in order to get the incentive from the first question.

As you probably understand by now, you have less than 5 seconds of attention span to explain to the user why should he stay in your website. That’s mean that you need to explain your offer, your product, your service and what makes you different in 3-5 words or a clear image. “Free iPhone”, “Best Pizza in Manhattan”, “Low-cost Flights in Europe”, “Win a Wii”, “1 Day Loan”, “IQ test”, “Online Games”, image of a PSP, screen shots from MMORPG etc. Reading is working too hard, so if you are not doing SEO, content is your enemy. Keep it simple, keep it clear and keep it short.

One of the first sales tips I got from my father was “If you want to sale jewelry to a woman show her 3 options to choose from. If you’ll show her 20 options she won’t be able to decide and she will leave without buying”. Too many options is too much work, so:

1. Keep the opportunities for thinking limited
2. Remove navigations bars
3. Minimize the number of fields the user needs to fill
4. Lead the user’s eye to the important places in the page
5. Keep the important buttons (“Submit”, “Check out”, “Order Now”…) above the fold and use a clear call to action.
6. Make sure your banners and landing pages match. If a user liked the banner and the offer in it and decided to click on it, he should get the same offering and the same look and feel in the landing page.
7. And again, keep it simple, keep it clear and keep it short.

One last point, why build one landing page when you can build 3? One of the advantages of advertising online is the simplicity of testing and optimizing different creatives to see which performs better and to improve their conversion; it is cheap, easy, and should be a mandatory step in every new offer launching. My dear friend Dov Yarkoni at Xtend wrote a good post about landing page optimization on the Xtend Blog.

If you have any questions, if you want to consult me about defining a flow, designing a landing page or banners, testing and optimizing, don’t hesitate to contact me at Adsmarket! We have the experience needed, we promoted thousands of creatives and landing pages, we know what performs well and what doesn’t, we know the publishers abilities, we have a team of very talented designers and most important we are here for you, to help and consult.

In the Land of the Blind, the One-Eyed Man is King

[Note: I titled this post from the book “Blindness” by Jose Saramago. The book is completely unrelated to affiliate marketing, so take that in mind if you go out to buy the book later on today ]

Maor Sadra here! The online advertising world is a jungle today (cue monkey sounds). There are so many sites, blogs, affiliates, publishers, media networks, etc. The more you spend online, the more likely your ads are being placed on thousands of sites.   This is generally good news, but can marketers control their spending and optimize the results in this chaos?

If an advertiser is working with a blind network, there isn’t much they can do to track results by site or affiliate.  You can never really predict results as you don’t control which affiliates or sites are running your offers. So what should advertisers do? 

The two remaining options: transparent, or half-transparent (or half-blind, depending on how you look at it), will support an advertiser’s efforts to do better business, but only one of these really comes through for the advertiser.

On completely transparent networks, an advertiser can view a list of publishers running their offers and find out which publishers or sites are bringing them the most impressions & clicks. But it’s very possible that only 1/10 of the sites actually generate the results from beyond the click.  Many networks and publishers prefer that the advertiser will not know this, fearing that the advertiser will optimize the campaign by limiting it to the best performing sites (which creates more work for the network employees to do, and leads to less revenue for the network…).   When networks do this, they are ignoring the simple fact that the advertiser will drop the network entirely if the results are generally not good…

Some advertisers still choose to go with a transparent network without the ability to track results by site.  I ask you: Why? Does it help the advertiser to know that an expert PPC affiliate called: “expertPPCaff1982” is running their campaign, if they won’t know how good the long term results are from this affiliate?
I recommend that an online advertiser today use a sort of modified transparent network, which allows them to independently track a few parameters. While the name of the network can remain static, other parameters should be dynamic.  A good example of this is tracking the performance by site or affiliate in an independent system.

Sounds like a lot of data? It is.

Sounds like a lot of work? It’s not really.

By tracking results per site/affiliate, advertisers can periodically analyze data to optimize and improve the results of the campaign over time.

Using this dynamic method of tracking will allow advertisers to find sites/affiliates within the network where there’s a high potential for quality traffic, and as every advertiser knows, finding quality sources is like finding gold! For these strong performers, advertisers can raise payouts or create customized marketing material or landing pages to increase the level of quality traffic. The opposite is also true; tracking also allows advertisers to spot which sites or affiliates drive lower quality traffic and make one of two calls: drop the site/affiliate from the campaign or optimize the creatives/landing pages to improve the results. 

I always recommend that advertisers use a simple numeric site/affiliate ID, enough to get control over the results of their campaigns, and I encourage advertisers to identify sites or affiliates that drive quality traffic, which leads to a solid, trusting, relationship and mutual success. A true “win-win” situation.

I admit, for the advertiser it’s sometimes a hassle to manage a large advertising budget online on multiple channels with multiple CPA /ROI targets, but it the long run it’s worth it!

So my tip this time is pretty simple: It’s better to have at least one eye to see the true results than being totally blind. You don’t want to miss out on the amazing things you’ll stumble upon!