Hello my friends,
It is always hard for newcomers to understand the budget especially if they do not know the specifics of the affiliate marketing.
Today we will discuss an important topic that will help you to build traffic channel – budget planning.
In the previous article, named «How to build the stable traffic channel?», we discussed the target consumer and the media type, so our next step will be the budget planning.
The finance part is the most important for the wealthy business and the main bases of success future. From the right budget planning fully depends a business strategy and a type of cooperation with your publisher.
To plan the budget, you need to choose the media type, all types of traffic were described in the previous article. But that process is a road with different directions where your choice defines your way, the same is here - the product defines the media type.
If you are planning to promote the mobile application or computer game, it is always better to take the CPI type of traffic. The user flow of the CPI traffic: user clicks on banner – redirected on the preview page (it can be the google store, the play store or your own site) – user download the product.
In case your product is a Nutra, it is better to use the CPA type of traffic as it is always considered the action. In case your purpose is to sale the product as mush as possible you are better to use the CPS – cost per sale. That means - to fire the pixel (to get the conversion) user must buy the product, only after that, your publisher will get the payment.
If we are talking about a site and your target is to attract the users, it is better to use the CPR - cost per registration. Here user would need to end the registration on your site and leave the email, then your publisher will get the conversion. Such kind of traffic will help you not only to attract the users, but to understand if they are interested in the product, cause user who is not interesting in getting information about your site he will not pass the registration, using the personal mail.
There are two sub-kinds of the traffic you might ask the publisher to use:
Incent traffic – an advertisement promise user to provide the bonus for the action (downloading app, registration, email confirmation…). It can be free trial for using the site or free coins for downloading the game. It works good in case your aim is attract auditory to your product, but in this case a small percentage of users will stay with you for a long time, others will take their bonus and will go away. The price per incent conversion will be less than for non-incent one. Conversion rate(CR) might be even more than 60%.
Non-incent traffic – organic traffic, that not consider a promotion. That is the most popular kind because in this case only interested users will take your product, as they are not motivated by any kind of bonus. The standard CR will be not more than 3%.
It is known an additional parameter from which the price of conversion depends on – geo. In the article «Mobile Affiliate Marketing Tiers Explained» you can find detailed description on the Tiers. There are counted three Tiers in the Affiliate Marketing - countries grouped by their economic development. The most expensive price per conversion will be in the Tier1 countries list, the Tier2 and the Tier3 lists will be much cheaper.
Returning to the budget planning, you need to understand how fast you want to get the return of investments and compare your expectations with approximate price for conversion. You should always remember that publisher (affiliate network or ad network) takes the commission about 60%.
Here we can have a look on a couple of examples of the campaigns with a cost per conversion but consider that offers have been taking from the network and the price is already shown with the commission.
CPI Incent campaign:
CPI non-incent campaign:
CPA Non-incent, one click-flow campaign:
You may have a look on the whole list of examples by link: https://affbank.com/offers
I hope this article will help you to build your budget and clear the most part of your questions.
To sum up, I would like to say, that the process is quite tough for a person who doesn’t know all pros and cons of the Affiliate Marketing and it is hard to find the right source, but in the next article I will tell you how to choose the media source and what are the main things to spend attention on.
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