By Shaan Yuhas
© Shaan Yuhas - All Rights Reserved
http://www.roicruncher.com
Looking to get more bang for your buck from advertising?
Sure, who isn't?
In fact, that's one thing every successful online marketer
understands... The value of a dollar -and what it means to
get a return on each advertising dollar spent.
With each advertising campaign, there's only one surefire
way to know if you're making money from it - that's by tracking
results.
It's easy to reduce the overall risk involved with
advertising -- you track which forms of advertising produce
results, then expand on them to increase profits.
Before I waste your time with added fluff telling you why
you should track results, let's get straight to it, and I'll
show you exactly how you can benefit from my 4 step plan.
Step one: Set up a website tracking system.
A website tracking system detects how users are getting to
your website -- from the sources that send you traffic
(Search engines, emails, and affiliates) to how many hits
your site receives.
From my personal experience, I highly recommend web stat,
although it's not free, they provide far more detailed
statistics including graphs, charts, and traffic analysis in
addition to their top notch support.
At only $5 a month, it is very reasonably priced and well
worth the investment.
Web Stat
http://www.web-stat.com
Step two: Cost per Visitor
Once you establish a tracking system you need to know how
much each visitor has cost you. That way, you can relate
how much you can afford to spend per visitor and remain
profitable.
The easiest way to calculate this cost is to take the income
generated from a time period (month/week) and divide by the
unique number of hits received during that same time period:
Formula:
Income / Unique Visitors = Cost Per Visitor
Example:
$2500 / 3426 = estimated $ .73 per visitor
Step three: Conversion Rate
Conversion rate (or sell through) is the average number of
people who buy from your site. Let's say that for every 100
people who visit your website, 2 people make a purchase -
your conversion rate is simply 2%
Formula:
Actions or Sales / Unique Visitors = Conversion Rate
Example:
2 / 100 = 2%
Alright, now that you understand how that works, let's look
at how all these numbers impact your business.
Step four: Analyzing
Many marketers make the mistake of just knowing these
numbers and have no idea how to use or analyze them. It's
crucial to your business that you know and use the numbers
to your advantage...
Let's say you're selling a product for $100 and you have a
conversion rate of 2% (like in our example above) then for
every 100 visitors to your website you make $200 ($100 x 2).
But let's not forget, each visitor costs $.72, so you're
paying $72(.72 cost per visitor x 100), so that's a $128 in
profit, which is stunning 177% return of investment. Now
that's an impressive bang for your buck.
Or think of it this way.
For every $72 you invested in advertising, you make $128 in
pure profit... Remember, that's only 100 visitors to your
site - think what 1000 visitors could mean - I'll let you do
the math.
As you can see, tracking and analyzing results offers huge
rewards for your online business. Applying these 4 steps in
your marketing efforts, will encourage you to make more
intelligent advertising decisions that result in increased
profits.
Bottom -line -- tracking works!
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Shaan Yuhas, CEO of eBusiness Insiders, announces the
development of roi cruncher - a tool to empower online
business owners with new ad tracking solutions that makes it
easier than ever to amplify profits by identifying cost-
effective, high conversion rate marketing campaigns. Click
here > http://www.roicruncher.com
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