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When do you cut your losses?

Discussion in 'CPA' started by sicnarf, Aug 15, 2011.

  1. sicnarf

    sicnarf Junior Member

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    How quickly do you cut your losses if your advertising costs more than your conversions? I had one PPC campaign that started out where I was spending more for PPC than conversion by $6. Then it went up to $13. When it hit $20 I paused the campaign and now I'm not sure what to do because I'm still new at this. Thanks
     
  2. ramjetsy7

    ramjetsy7 Junior Member

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    Depends on your financial status I guess. Personally, I'd panic and ditch it as soon as I made a loss, because I'm chickenshit. :D
     
  3. redtide1969

    redtide1969 BANNED BANNED Jr. VIP Premium Member

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    PPC isn't about quick results as soon as you throw up an initial test campaign. I have yet to be profitable right from the start with any niche during its initial testing phase.

    The big (long term) money in PPC only happens when you've got a campaign optimized down to just a handful of remaining low cost per click/high click volume/high converting keywords. To get there you have to start with testing as many keywords as possible and have the budget to weed through the non-converting keywords on your way to finding the golden keywords.

    As far as when to throw in the towel, it's all a matter of your budget. To be totally honest, if you're sweating the $20 testing loss I would recommend stepping away from PPC in general.
     
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  4. jdizzle

    jdizzle Registered Member

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    great answer :D
     
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  5. SEORocks

    SEORocks Junior Member

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    PPC is designed to drive traffic to your website. If you are spending more than you are making, you need to ask yourself two questions.

    How much traffic am I getting and what is my conversion rate.

    If you have a lot of traffic and no sales, your website is at fault and the PPC is working just fine. Assuming you do know how to do keyword research and you are on topic along with using buyer and not researching type of keywords.

    If you have no or very little traffic, you need to look at different keywords for your product or niche as you are probably using the wrong keywords.

    As far as when to call it quits....I budget $200 per keyword and I also make sure I can track what each keyword is doing. You won't always be on the negative end of things.

    You really need to understand how PPC works, not just how to place an add, but all about PPC.

    I agree with the other post that if $20 is prompting you to ask when should I cut my losses, you may need to get out and wait until you have a larger budget.

    Once you figure out PPC it is a lot easier (to me) than trying to fight Google for ranking. Don't get me wrong, I do a lot of SEO and have high ranking sites, but if I had to generate sales quickly I use PPC.

    Another thing is if you want to find out if you have a good product, niche or converting website, don't waste your time with SEO, test it with PPC and if you have a winner, then SEO it and keep it at the top for free.

    I hope this helps, these are my opinions and in no way am I stating things can't be done differently. I'm just letting you know a little about my methods.
     
  6. sicnarf

    sicnarf Junior Member

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    Thanks for the feedback Redtide and SeoRocks. I'd suspect that part of my issue right now is that I 'm promoting free movie tickets to a movie that is losing it's steam so it's time to move on. I did make $33 but in the process it has cost me $54 in clicks. I think what I need to do is find an evergreen product so I can really test it.

    Getting back to the movie tickets, the PPC campaign I ran was a direct link to the advertiser site (approved by my account manager). According to the CPA network I was working with, the EPC for the tickets was .10 but mine was only .03 when I paused advertising. The highest EPC I was able to achieve was .05. People were clicking the ads I created but for some reason they just weren't following through on the email submit. I know there are probably tons of variables as to what may have caused the low EPC for my campaigns, but can anyone provide any insight in what I could have done better? Thanks