I have just finished reading through Rosalind Gardner's "Super Affiliate Handbook 2005" and some of the examples in there regarding PPC don't seem to be very feasible, considering the book was written almost 4 years ago.
One of the examples was in regards to PPC marketing and determining profitability. It went something like this.
1. Find a bunch of keyword and phrases that total at least 50,000 searches a month
2. Assume a 1.5% Click Through Rate
3. Assume a 1.5% Conversion Rate
4. Assume a 6 cent average ad cost (this does not make sense to me)
Using the above you could something like this
Searches: 50,000
Clicks: 750
Conversions: 11
Sales: $440 (Assuming $40 per sale)
Expenses: $45 (Author recommends to use 6-cent average)
Net: $395 / month
The problem I see with the above is that 6 cents a click in adwords is not realistic in my view. Now I haven't read any good books on adwords, and I will soon, but from the few campaigns I have run unsuccessfully
, I don't see how 6 cents a click will get you anywhere. Personally, I think you need a minimum of 50 cents or more a click.
Searches: 50,000
Clicks: 750
Conversions: 11
Sales: $440 (Assuming $40 per sale)
Expenses: $375 (Author recommends to use 50-cent average)
Net: $65 / month
Am I missing something in my logic? I have done keyword research with the adwords tool that shows the price per click and any phrase worth going after costs a decent amount per click, even when there is little competition. In cases of low competition wouldn't it be better to try and get search engine traffic for free, instead of running an ad campaign?
Any input into this would be great, thanks!