Affiliate Marketing – Quitting While You’re Ahead
Recently, I was trying to run a campaign that did very well initially but then bottomed out within a couple of weeks. The reason behind this was, as you might have guessed, saturation. As soon as the offer became popular, tons of affiliates jumped on the offer and soon, it became a downward spiral into the abyss.
What was key to maintaining profit (as sometimes we forget that's what affiliate marketing is about) was getting out when I saw the symptoms of a sinking ship. First off, my conversion ratio started dropping. Conversion ratio is the number of leads divided by the number of clicks it takes to get the leads. Secondly, my average earning per click started to plummet from almost $2.00 to nearly $0.50, which was a very obvious sign. Third, I just saw tons of similar ads popping up in my niche each day.
Regardless of my low bids and my 'Great' quality score, it didn't seem to matter in the end. So just as I started to lose money, I decided to stop. There's always the chance that I could've made a ton more money by staying in but the odds weren't great, so i decided to bail. The odds of failing were much higher and so I feel I saved on the opportunity cost by diverting my efforts elsewhere.
Sometimes succeeding this business is in knowing when to quit, so I just wanted to let you know that it isn't failure, it's practice.
Good luck,
Scott
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February 7th, 2008 at 2:16 pm
Its a tough decision. No one wants to get out too early, but at the same time – it is unwise to be too greedy.
February 8th, 2008 at 2:46 am
I don’t do a lot of PPC campaigns but I agree that time spend elsewhere could be the best financial step when you see the floor dropping out from under you.
If you can increase the number of long tail keyword phrases you may be able to increase you income again.
February 8th, 2008 at 6:42 am
Interesting observation, that the offer is just becoming to saturated to make money, but shouldn’t there be a competitive advantage for you being so much earlier in the niche and being able to control some of the text ad placements?
February 23rd, 2008 at 8:20 am
[...] Quitting while you are ahead [The Affiliate Toolbox] [...]
February 27th, 2008 at 2:24 am
Good article. I used to stay in the game and ended up often loosing when a market was saturated. I have since learned in the last few years … best to bail and spend that time looking for a more profitable niche while everyone is still at the ol’ fishing hole duking it out for the few fish that are left.