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Adwords CPM Placement Targeting + YPN = Positive ROI
Posted by Scott on 14th November, 2007 | 17 commentsI used to think Google Adwords campaigns were a waste of time for publishers. Maybe retailers could turn a profit paying $0.50/click or more for traffic, but not publishers with content sites monetized with ads.
Recent tests with Google’s CPM based sitematch campaigns (now called placement targeting) have turned me around though. I have been testing several CPM campaigns, targeted to run on a specific few sites, and have been funneling the traffic into a site that is monetized largely with Yahoo’s Publisher Network (YPN). The results have been great.
I have been paying an average $1.00 CPM and have a CTR of about 1% (though new ads are testing as high as 1.5%). With a daily ad spend of about $2,000, that would yield 20,000 visitors at an average of just $0.10/click. YPN has been yielding a high average CPC of around $2/click with a decent CTR, and as a result has been generating about 1.25x as much revenue as I am spending on Adwords.
If you test YPN to monetize your landing page, be sure to use their ad targeting feature to give them a “hint” about your site’s content. Failing to do so means the difference between earning <$1 click and >$2 click.
The cool thing about Adwords CPM placement targeting is that the number of clicks you receive is largely in your hands. Test a zillion different ads to find the one that has the highest click through rate, because you pay per impression, not per click. Course, you need to make sure your ad is on target because otherwise you’ll be attracting bum traffic that isn’t interested in what you’re selling. That may not matter though if you’re running your ad on a site full of home theater enthusiasts though for instance - you may just want to write your ad copy to pull over as many people as possible to your site, knowing that they will all be the people you’re trying to reach.
Only with CPM based placement targeting can you achieve a large amount of targeted traffic for a CPC of $0.10 or less. I love that you can run your ads on specific sites, which lets you target the people with the exact interests that you’re looking for. If you try to run a CPC based Adwords campaign with a $0.10/click bid, you’re going to have to bid on thousands of long tail keywords to get any volume of traffic at all.
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Wednesday, November 14th, 2007 at 2:05 pm and is filed under Web Business. If you like this post why not subscribe to my full text RSS feed. You can leave a response, or trackback from your own site.
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This never really occurred to me. Are you saying that if you can bring in traffic that costs less than your site’s CPM, you are making money?
You seem to be comparing the cost per click to the site’s revenue per click, but that would only make sense to me if the CTRs were the exact same. Why not just compare the CPMs to each other?
Correct. I am spending x per day on Adwords and generating 1.25x per day in revenue using YPN.
You can’t compare CPM’s because the Adwords conversion rate isn’t 100%, it’s 1.5%.
So for instance, lets say your ad runs on Google 1 Million times per day with a $1 CPM. That costs $1,000. It doesn’t generate 1 Million clicks though, at a CTR of 1.5% it generates 15,000 clicks. So that’s 15,000 people that are now looking at my site. So the trick is to generate more than $1,000/day from those 15,000 people, using: YPN, Adsense, Kontera, Chitika, WidgetBucks, Shopping.com’s API etc.
If you’re able to break even or come close to it, even if you don’t earn a profit, you’ll be building your site’s readership over time.
Classic arbitrage, which while some folks have done VERY well at, can be notoriously difficult for a newbie.
Great info. But it can be the devil trying to get both sides of the equation to work!
Vic
I think I’m with you. I just looked at Revenue Per Visit on my site though and it’s less than one penny this month. (Visit being from Google Analytics, Revenue being sitewide).
So I don’t think there’s any way to get traffic at less than a penny per visit!
“Great info. But it can be the devil trying to get both sides of the equation to work!”
Definitely. The main factors that determine success are:
-The quality of your ad copy (how high a CTR the ads have in Adwords)
-How well you’re monetizing your site
-What sites you choose to target for your ads
-The CPM you pay
-The niche you’re going after, how popular it is etc.
“So I don’t think there’s any way to get traffic at less than a penny per visit!”
Yeah I’d say that’d be tough. I’m paying about $0.09 per visit now. If I doubled my CTR (which can be done I’m sure by testing a bunch of ads), that would drop to $0.04 per visit. If I lowered the CPM I’m paying, I could get the cost per user down further, but I’d also lower my click volume.
Scott,
I’m going to try it with a site of mine that has a decent CPM. I’ll let you know how it works.
I had a campaign from the previous content network plan but thanks for reminding me to try the new placement targeting.
Vic
See how long that lasts, Yahoo has been pretty strict on arbitraged traffic for the past year and a half. The good news is I haven’t heard any reports of users not being paid out before having their accounts shut down. Same goes for monetizing arbitraged traffic with Adsense.
“Yahoo has been pretty strict on arbitraged traffic for the past year and a half.”
I’m not driving traffic to a junk landing page plastered with YPN ads. I’m using Adwords to drive traffic to one of our existing, functioning content-rich sites, which is traffic that’s highly targeted to the subject of the site, and I’m using YPN and other methods to monetize it just like any other publisher.
So now you take my advice to heart? LOL. Remember when you posted that you preferred Clicks over Affiliate Sales? Now your saying affiliate sales are where the money’s at? Remember i suggested that it would be profitable if you make an aff. page and drive traffic using Adwords and other methods? You said something like you didnt know much but have not had much success with it. Now it seems like your having a change of heart. Am i correct????
“Now your saying affiliate sales are where the money’s at?”
No not at all. YPN is CPC based, not CPA. I get paid when a user clicks on a link (cost per click), not when a user buys something (cost per action). It is possible to make a lot of money with CPA based ads (especially through someplace like azoogleads), but in my case, I do far better with CPC.
oh ok thx for clearing that up. keep the great posts coming
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I think CPC and CPM have become very expensive and is becoming a risk game that could turn out to be very expensive indeed. Better optimize your website for natural search results.
@ Joy
I agree, but with organic seo, the big G could change the SERPS algorithm/secret recipe overnight and find your site has tanked.
It’s a fine balance between the two (seo & ppc) that only a true ninja warrior can master (the last bit I made up as I’m just a lazy bum!).
on my best converting website (eCPM of about $17) using your stats (which I think I’d be pretty close to as far as CTR) I’d have to be paying a $.25 CPM to break even with a 1.5% CTR from adwords. Then again, I’m monetizing the website with only adsense. I’m going to have to do some experimenting to see if I could either monetize the site better to get a better eCPM or shoot for getting a 25 cent CPM from adwords or another network.