The HIDDEN Benefits Of Paid Advertising 
- Putting Your Feet To The Fire

Forced testing:  How to increase your sales 
and conversion rate almost against your will

From the desk of Timothy A. Gross

Friends, you may be inches away from doubling or tripling the profitability of your online business.

Whether you have an established profitable website or are just starting out, the difference between "failing and succeeding" or "doing OK and doing GREAT" can be very slight.

For most online businesses, the "Million-Dollar Question" is this:

WHAT IS EACH VISITOR
TO MY WEBSITE WORTH?

The answer to that question will dictate (and limit) most of your marketing efforts. I've spent tens of thousands of dollars in online advertising over the last the last 3 months.

It's been very profitable overall - But more importantly, it forced me to change the way I was running my business!  It can help you change yours too... I'll explain in a minute.

FIRST: A Short Refresher Course On R.O.I. 
(Return On Investment - What is each visitor worth to you?)

Let's take an easy example and say you're selling a downloadable product that costs $100. If it takes 100 visitors to make one sale, then each visitor to your site is worth one dollar ($1).  -That's assuming you only have one product, and no way to make extra money from your customers. (Which isn't true, we'll get into that in later issues ;-)

The next variable you need to determine is how much it costs to get each person to your website. If you're running banner ads that get a 1% clickthrough, that means that one out of every 100 people who sees your banner will click on it. And we already know in this example that it takes 100 visitors to your site to make a sale.

So it would take 10,000 people seeing your banner (100 x 100 = 10,000) to make a sale - And each sale would make you $100. That means that as long as it costs you less than $100 for 10,000 people to see your banner, you're making money.

ON A SIDE NOTE: The cost of banner impressions is rated by the 1,000 impressions. It's called "CPM" which stands for "cost per thousand". If you paid $5 CPM, that would be $5 per 1,000 banner impressions, or $50 for 10,000 banner impressions. Since we already figured out that each 10,000 banner impressions earns us $100 in this example, we'd make back $50 profit on every $50 we spent.

Now, I know that this entire example is a real "yawner" (boring as heck), but the end result is *very exciting*... Because these results can be repeated and extrapolated. These results can earn you $1,000's in extra profits, because you can run this successful ad over and over online.

BACK TO MY POINT...

The goal of this article is not to explain the mechanics of banner advertising. It is to explain how paid advertising can become the catalyst for increasing your profits by FORCING you to improve your:

• Headline

• Guarantee

• Website Layout

• Followup System

• Overall Offer

HERE'S WHY:

Someone once said, "I wouldn't stay up one night to earn $100, but I'd stay up for 3 nights trying to keep from losing $100."

If your online business is currently making money, that's great. But it's almost certain that you haven't done everything you can to maximize your profits, and that fact is hurting everything that you currently do.

HERE ARE SOME EXAMPLES

* One product that I've been involved with selling has done pretty well with paid advertising so far. But just last week we ran an "opt-in email" test to 100,000 people with a company that charges no upfront cost, and only asks for a commission on every sale that their efforts generate. (Sweet deal)

Now here's the kicker: They'll email the offer to their entire list (10,000,000 people) IF the results of the first 100,000 brings them somewhere in the neighborhood of 20 sales. Even though this particular offer I wrote has done well in other advertising mediums, it fell short of the mark for this campaign.

The Challenge: If I can increase the response of the ad through another test, they'll email the offer to the rest of the 10,000,000. So how motivated am I to increase the results? - PRETTY MOTIVATED!!  And with that motivation, I GUARANTEE that I will find a way to increase the response to get them to email that 10,000,000 list.

Due to the response of this one ad, here are the variables I've already changed:

• The Headline

• Length of the ad (shortened it as a test)

• Guarantee - Made it even stronger, possibly a "double your money back" guarantee

• Number of bonuses were increased

NECESSITY IS THE MOTHER OF INVENTION

With "free" traffic to your site, you're simply more complacent. You figure that a certain number of visitors subscribe to your newsletter, a certain number of people purchase your product, and that's life. -You're not really that motivated to test and adapt to increase your sales.

But with paid advertising, it becomes a "life or death situation". If you know you're paying 50 cents for every visitor that comes to your site, every person who visits and does not buy and does not subscribe to your newsletter/followup system is costing you plenty!

It Pretty Much Forces You To Change And Adapt

For instance - If you don't currently have a "pop-up" exit box that prompts your exiting visitors to enter their email to receive a free gift of high value, paid advertising will pretty much force you to do it.

If you don't have an effective follow-up autoresponder sequence that "seals the deal", this will force you to do it. You may experiment with offering other/outside products in your follow-ups. (I've tested that successfully as well.)

I'll have some specific paid-advertising tips and resources for you in future issues.  In the next issue of the Profit Systems Report:  "Is following the 'guru' advice of giving the appearance of being a big business hurting your profits?"

-Stay tuned for this eye-opening issue!

To your success, Timothy A. Gross
Executive Director - Educated Media, LLC

P.S. - In response to the many emails I've received regarding the opt-in email advertising that charges no up-front fee: Since we're still currently working with this opt-in email company, we'd prefer not to disclose who they are... And these are the types of sources we share with clients only. All I can suggest is that when you contact advertisers, *ask* about these types of arrangements. Because of the economy being how it is, advertisers are much more willing to try this, as long as it can be established that the response to your offer is good. (Don't be afraid to "haggle"!)

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