Aug 17, 2007

Google Referral Ads

Google has newly introduced an ad system called Referral Ads under Adsense. From its first view, it's quite clear that it's an attempt by Google to poke into the affiliate marketing niche which has already been congested with many other competing companies. Why? Because affiliate marketing is actually one of the hottest segment over the web today.

How Referral Ads work is pretty simple. Basically like the regular Google Adsense ads, referral ads display items which you the owner of site select to display. For example if your website is about bike and you prefer displaying ads about bikes they will display exactly ads for that and nothing else. It also provides you the option to display various other ads and you the owner of the site can let referral ads autopick as to which ads "convert" the best. When I say the word convert, I mean a customer either signing up for a product or buying it. This term is defined differently with various types of advertisers, it just depends. The payout is based on the amount of visitors that actually buys the product that your site is advertising through referral ads, whenever a customer buys something you get paid a certain percentage as the result.

Now imagine if a visitor that goes to the ad displayed on your site and buys a tv and let's just hypothetically say that the payout is 3% and the TV is $300 you have just earned $9 right on the spot. Instead of you getting paid on pennies on the dollar per click with regular Adsense this program seems to be paying a lot more and in many ways better in comparison right? WRONG! Dead wrong and the here's the reason why. With your regular Adsense you get paid per click from your visitors going to the advertiser, however with referral ads you don't get paid for that and that is a very big deal!

Now, let's do some math together. How much are you currently getting your clicks with Google Adsense? If you blend in your ads and optimize it, you are probably sitting at 1-2% tops. The percentage is awfully low. From these percentage of people, how many of them do you think would actually buy something or sign up with someone? Extremely low and you're looking at something close to 1% but less than that. In another words, every 1000 visitors that come to your site 10 visitors will visit your ad and close to none will sign up. To get any sign up with our math, we are looking at at least 10000 visitors.

I have tested referral ads in one of the site that own that is filled with visitors. You are probably curious as to the results right? Out of 9000 unique visitors in the day that I've tested it, only 9 people have actually "clicked" on the ads and obviously no conversions. If you are considering using referral ads, I would suggest looking elsewhere to make your money online! -Swapw

1 comment:

make money online said...

that is if you get people to buy the ads. but the likelihood of people buying the items from the ads is very low, unless you have thousands of visitors a day..