It has proven difficult to make digital ad formats and channels work on a pure CPA basis with most clients looking for a direct return of a minimum 300% on their ad spend. However, our work in this area has uncovered some notable and highly profitable exceptions. Here’s our top 3:
- Google Performance Max:
Google Performance Max was introduced by Google approximately 12 months ago as the next generation in Smart Shopping. The big advance is that via this channel Google will serve your ads in the appropriate ad format across all its product platforms, using automated bidding to maximise ROI and reach.
So ads are served on Google Search, You Tube, Google Display, Maps and Gmail – in short, wherever your customers are looking to shop. Google Performance Max optimises your campaign by placing your ads where consumers are converting best! You can set your own targets to maximise profitability, for example, cost per Action (CPA) or Return on Ad Spend (ROAS).
The results we’ve seen have consistently exceeded client expectations. The graph below illustrates a typical growth pattern our clients have seen over the first 6 months of us managing their Google Performance Max campaigns, making continuous optimisations towards their conversion goals.
- Affiliates:
For those unfamiliar with affiliates and affiliate networks, this must surely be the lowest risk form of digital (if not any) advertising. Typically, you pay affiliates who promote your product to their audience a fixed commission on each sale. The affiliate sites vary in their content and targeting but voucher code sites and cash-back sites are among the most effective as the audience visits the site with the intention of shopping. Visitors have a high purchase intent.
The typical total cost of sale inclusive of all commissions, tech and management fees is 20% of gross sales value, so you are guaranteed a return of 5x your marketing cost.
The graph below illustrates a typical affiliate launch for an individual product:
- Native ads:
Native ads are digital ad placements that look and read like editorial content but in fact promote a specific product or service. Typically, a native ad campaign is run in 2 stages. The first stage is designed to create a pool of prospects and the prospecting ads have headlines which are written to entice the reader to discover more. Headlines often begin with phrases such as “Discover how to….”, “Find out why….”, “See what happened when…”
The second stage retargets the pool of prospects with performance ads promoting a very specific offer. Headlines are direct-sell and promotional, “Save up to…. “, “Limited time Offer…” etc.
Both ad placements, stage 1 prospecting and stage 2 performance, can be targeted to a specific audience, specific publications and / or specific editorial content. Media is bought on a Cost per click (CPC) basis with an average CPC in the region of 50p.
Example “prospecting “ad
For further information on low cost, low risk testing of these digital opportunities, please talk to Ben Cleaver @ Ben.cleaver@laveryrowe.co.uk
