4 Online Advertising Traffic Sources. 95% Marketers Know Nothing About

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1 4 Online Advertising Traffic Sources 95% Marketers Know Nothing About 1

2 About the Author TaeWoo Kim is an digital marketer specializing in customer acquisition, lead generation, search engine and social media marketing, and all that wonderful sexy make money stuff. And yes, he s sexy too. <insert cricket chirps>. He also runs marketing at LaunchBit. You can follow him on TaeWooKim Table of Contents Introduction CPV Retargeting RTB / Media Buys Ads in 2

3 Are you an online advertiser? Here, let me read your mind *ohmmmm*.. Ok, I got it. You do pay per click in search engine marketing... maybe some ads on Facebook and found out that it was horrible.. and maybe some banner ads. Am I right? 3

4 Unfortunately, that s the story of 95% of digital marketers that do any form of online marketing. And that is exactly why 95% of the digital marketers out on the web don t have a positive ROI in advertising. Why? Simple: because they DO THE SAME THING. Call me crazy, but if you want results that are different from everyone else s, shouldn t you be doing something.. well.. DIFFERENT? Believe it or not, 95% of the advertisers fight for the same traffic source. And who is the biggest beneficiary of that competition? Yes, the answer is.. NOT YOU. Just think about it: how are online advertising companies like Google and Microsoft/Yahoo making billions per year? Yet, most advertising campaigns fail to work? So why not go where there s much more room for you (especially the smaller and the medium size) advertisers to play with? Here are 4 online advertising sources that most will never explore, even if they may know it. CPV Retargeting RTB/ Media buys Ads in 4

5 1 CPV You ve all heard of CPM and CPC. Blah blah. Ok, here s a new term.. CPV. Cost per VIEW. (Also known as PPV, pay per view) Ever visit a site like Forbes or NY Times, and they pop this advertising before they show you the stuff that you want to read? Yea, that s called CPV advertising. 5

6 You can usually tell if it s a CPV advertising because they ll usually have a link on top somewhere that says continue to site/article/etc if you want to skip the ad. In fact, if you really think about it, traditional TV advertising is actually CPV based advertising because they pause the main program and show you the media created by the advertisers to promote their products or services. Because of the relatively low costs, this is quite popular with affiliate advertisers, local businesses, and regional branding advertisers. As with any form of online advertising, you need to test your creatives to see what works best. Especially because you can find insane amounts of traffic in a very short amount of time. In other words, there is no difference between someone clicking on an ad link and going to your landing page vs. someone seeing your landing page directly... except that there s no intent, so your conversion rate might be fairly dismal (if it occurs at all). That s because usually CPV targeting is done on a demographics level (age, income, location, etc.) Just because I m a 45 year old male from NYC reading Bloomberg doesn t necessarily mean I want to refinance my house to a 30 year mortgage. You guessed it: this is another form of traditional interruption marketing. As far as costs go, the price can range anywhere from fractions of pennies to prices quite comparable to banner ad CPM costs, all depending on targeting. And as far as volume, there are quite a large number of CPV Imprressions. Age + Income + Location + Etc. = Ad 6

7 2 Retargeting Ever visit a website, leave it, and banner ads start following you everywhere? Creepy? Yes. Effective? Highly. This is called retargeting because you can re-target a customer who has seen your website to remind him/her of your product. This type of advertising also deals with the display network in the form of banner ads. If the retargeting follows the user, the banner ad might have zero relevance to the content of the site that your customer might be visiting. But, the reason for its effectiveness is that on the average, it takes about 5-6 impressions of your marketing message before a buyer will take action. Imagine having a microphone that has feet and follows your customer around. Yes, if you do it TOO often, you can annoy the buyer and eventually lose that customer. So the trick is to go slowly but surely. Unfortunately, if you have multiple products or services, you have to track what they ve seen with individual tracking codes. Likewise, different buyers are in different parts of the buying cycle, which means you need to know which page on your website is dedicated to awareness, evaluation, or purchase. Depending on where they are in the cycle, you can have separate campaigns or creatives with different bids. The closer they are to the buying cycle, the more aggressive you want to be with your bidding. And because of insane segmentation that needs to be implemented, most marketers just avoid this altogether or just clump campaigns into, which tends to lower their ROI, eventually causing them to stop all their retargeting efforts. 7

8 RTB/ 3 Media Buys In the old days of marketing, people used to call this media buying. Here s how it worked. Suppose you want to promote your WidgetCompany.com selling your, well, widgets. You know that SomeWidgetBlog.com is where a lot of your customers have heard about you and they eventually became your customers. So you think Great, I m going to advertise there. So you reach out to the owners of SomeWidgetBlog.com and ask if they can advertise on your site, in exchange for payment. Now there are THREE ways this can happen. A. Buy directly from site owner B. Buy through middleman C. Real-time Bidding 8

9 A. You buy directly from the site owner This is the simplest but the most inefficient way to buy the media. I say simplest because there is NO middleman between the buyer and the seller. You negotiate a price, the seller accepts, and the transaction is now complete. But it s inefficient, because you have to do this with every single site you might be interested in buying ads on. B. You buy through a middleman Now, going BACK to example #1.. what if the buyer decides he wants only a portion of impressions on a site? For example, certain products, like dating sites, convert best at certain times of the day. And in certain cases, you want to show your ads on only portions of the website. Some people don t want their companies or products to be associated with morally objectionable content. Imagine if the seller had to deal with MULTIPLE buyers who all want something different. That would be nightmare. And that s where advertising networks come in. Buyers want to buy from multiple sellers. Sellers want to sell to multiple buyers. And, the network does all the heavy lifting of figuring out who wants what in an exchange for a cut of the transaction. This is where advertising networks like the Google display network (i.e. Adsense) lives. 9

10 C. RTB (real time bidding) Whether or not there s the middleman, there s the problem of inefficiency in the market. Because the sellers and the buyers still have to come to terms on what is fair, there is tension in the market. Unfortunately, this tension is not static and is constantly changing. Say, you negotiated $5 CPM to SomeWidgetBlog.com to display your ad for 1 million impressions for the next 3 months. But there is no such thing as immunity to time. Some products sell better at certain times. Some promotions do better. Competitors come out with new PR or innovation, etc. In other words, your sales and ROI on advertising spend (also known as ROAS or return on ad spend) will vary, which means you need to adjust the bid accordingly. In scenario #1 and #2, the bid is fairly static. So to solve that problem, there is a new technology called RTB or real time bidding which lets you bid on each and every impression for that banner ad space. Because this is technically challenging and fairly complex in terms of how the bids are calculated, most RTB players go through some kind of service provider that handles all the complex dealings in return for a percentage of ad spend. 10

11 4 Ads in This is by far one of the most overlooked sources of traffic that most advertisers fail to explore. In fact, if done right, you can get up to triple digit ROAS (return on ad spend) with in - advertising. Believe it or not, there are literally hundreds of billions of subscription s sent daily. I m sure you belong to some as well, like Groupon. Because the content is so compelling, the list subscribers want to hear from them on a regular basis. 11

12 On the flip side, the mailing list owner needs to have an effective way to monetize his list. Now, there are really only TWO ways you can make money online: sell your own stuff or sell someone else s stuff. Selling your own stuff is pretty basic: tell people on your list what you offer. If the offer is compelling, they buy. If not, then don t. Quite simple. Now, selling other people s stuff is quite a large topic. The list owner can sell the advertisers things on three levels: as an affiliate (i.e. split profits) or traffic provider (pay per click). If you are a new advertiser and have no traction with your product, it is highly unlikely that a mailing list owner will promote your product on a pay-per-sale basis because it s an opportunity cost for them. Of course, all of this assumes that your marketing message is consistent or at least relevant to the mailing list owner in your in - emai l tex t or banner ads.. If you sell weight loss programs, approaching mailing list owners that talk about dog training is probably a huge waste of time. Then there are other issues that you need to know when negotiating an ad buy in A. Open Rate B. Ad Placement C. Ad Format D. Flat Fee vs Performance based But a lot of mailing list owners will gladly promote your product or service by telling their people about YOU. There are two ways they will do that: flat fee (X dollars for Y # of s sent) or performance basis (X dollars per click). As with all forms of online advertising, per click is the preferred method because it reduces the risk on the advertiser part. This is MORE so with marketing because s have another variable factor called open rate. Not only do your ad creatives have to have high CTR (click through rate), but the mailing list owner has to make sure that the s are opened. 12

13 A. Open Rate Ask how large an list is AND their open rate. Walk away from anyone under a 15% open rate.open rates are a good indicator of click-through-rate (on opens). In other words, say you are given a choice to buy 2 lists: 1000 people 50% open rate 2000 people 25% open rate Both have the same number of total people opening. So you would think they would perform about the same. WRONG. Typically, the first list will have a higher click-through-rate on opens. Open rates are a good indicator of how engaged your list is. Ask about click-through-rate (on opens). But list owners will rarely give you the lowdown on this. 13

14 B) Ad Placement Find out where the ad placement will be. Do they sell dedicated/solo ads? Or ads embedded in their newsletter content? Ad placement will make or break your ad buy. Buy only dedicated/solo ads OR ads that are placed at the top/top-left of newsletters. Ads placed on the top-right, right, middle, bottom of (English) newsletters tend to get such low CTRs and are not worth your time. C) Ad Format Find out the ad format. Is it text? Is it banner? Buy text formats. Text ads get seen no matter whether readers display images in s or not. And even for people who do display images, text ads typically generate 2-10x more clicks than banner ads, probably because they are more like native ads. For top placement, text ads should generate between 0.5-5% CTR on opens. So, if a list has 1000 people, with a 50% open rate, 500 people will see it. And, 2 to 25 people will click on it. Typically, the CTR number is closer to 1% (5 people in this case). So, it might only be worthwhile to chase a deal if a list has a LOT of people... BUT, if you are doing dedicate/solo buys, the CTR on opens will be a lot higher. You can probably expect between 15-50% CTR. 14

15 D) Flat fee vs. Performance based Most lists will want to be paid on a flat fee basis. You can try negotiating on a cost-perclick basis or a cost-per-lead basis, but this is often near impossible. If you are paying on a flat fee basis, you should always negotiate a rate card. Often rate cards are extremely expensive. E.g. well known newsletters such as Thrillist may charge $300 CPM. Bargain down an artificially high price to under 50% the rate card. Sometimes down to even 25% the ask price. In general, the less well known the list, the more you can negotiate. A lot of companies who do massive ad buys will typically have a specialist who just negotiates ad buys in newsletters with tons of publishers. Your deal might not go through, because you may not agree on price with the publisher. So, kick off conversations with lots of newsletters. One of your bargaining chips is to do multiple ad buys. Publishers are usually more willing to negotiate if you buy a LOT of ad spots. Managing ad buys in s is complicated and time-consuming. For an easier time, you can use LaunchBit, to buy ads in CAN-SPAM compliant s on a cost-per-click basis. 15

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