Yesterday I had a conversation with another friend of mine—she is providing customer service for Google AdWords. In the middle of a talk about the most common problem people have with the product it hit me—”We can advertise! But wait, we don’t have the budget for it…” Not so fast cowboy. Think first!
My biggest takeaway from the conversation was that if we want to make omframework.com our main sales channel and avoid OpenCart.com’s marketplace we can use the same amount of margin they take from us(sales commission) and feed an AdWords campaign with it. The marketplace is costly and especially business-model limiting, despite bringing in a lot of sales.
Running the numbers, the budget per sale becomes unexpectedly big for a business with our scale. After all we are just a product company with a very niche offering.
The actual size of the billboard
OpenCart.com takes from us 20% of the sale price.
The cost of having Gumroad as an alternative sales channel is 5%+$0.25 on every transaction.
So, our customer acquisition budget is 20%-5%-$0.25 = 15%-$0.25 = $11.6. A quick CPC research using the Keyword Ideas Tool in AdWords told me that the average price of the keywords I am targeting is around $1.44 which means that if we have around 12.5% conversion rate from AdWords traffic everything will be in balance.
$11.6 is a good baseline to start from. There are other ad networks, too, yet this is not that important for the moment. What is important though is where to start? Obvious answer—keyword research. Not so obvious—where to research for them?