Hey it’s Opossum here! Welcome to my free monthly Q/A Roundup. Today’s post is on some of the best questions in the last month. Each week I write about a new topic or analyze a new digital business. If you’re not a subscriber, here’s what you missed this month:
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Question #1
Can we assume the amount of ad spend is going to linearly scale down based on where you target? E.g $300 USA to test a campaign vs $50-$100 small countrylike Romania?
The original question came from a conversation about setting up ads and testing different creative. I’ll have a post coming out about this soon…
If you’re testing creative, with experience, you can usually get a decent enough read on whether your creative/copy is good with $300 of spend. $300 at least allows you to put the ad into 1 of 3 buckets.
Isn’t and won’t perform well enough to be margin positive. Kill the ad.
Could perform well enough. Need more time/ad dollars to see.
We’re going to the moon baby.
So the real question is. If you’re in a much cheaper country than the US, is it still $300 US dollars?
Short answer is No.
The long answer is that the CPCs or CPMs should scale linearly down. Nobody in Cambodia is going to pay American CPCs when the revenue is 1/5 for the same product.
Generally speaking, advertising campaigns need to be ROI positive. If the cost of items in a country is 1/5 of items in the US, the advertising costs should be roughly 1/5 of the cost.
While there’s going to obviously be noise in the data and it won’t be exactly linear. It’s a good rule of thumb to go by.
So if I'm paying anywhere from $0.30 - $1 CPC for a good converting ad in the US, and Cambodia is 1/5 the cost of the US, the ad cost should be $0.06-$0.20 CPC for the same item.
If my CPA (cost per acquisition) is landing in the range of $15-$20 for a good ad, in Cambodia that should equate to $3-$4.
Again. Not exact, but it should be a good starting guide for when you start running ads and deciding if your CPC and CPA is normal. The best way to do this is to keep iterating after knowing your contribution margin and what makes you ROI positive.
If you don’t get why this will scale down, go review the supply and demand curve in Economics 101 for commodities. Ad algorithms will maximize profit for the platform. Which means that there will be no demand for the ads at the US CPC price in a low cost country. The platform will be forced to lower CPC costs until demand for the ads come in. Then it will shift CPC cost to maximize profit to the platform.
Ultimately, scaling down roughly linearly based off of competition and the cost of items in the country.
Question #2
I spent the past year and a half building this site. I feel I'd do better in sales via Twitter and Insta. But, my following count is weak.
Just wanted your opinion if you think the site/idea is shit or not. I've got like 15 new designs I'm about to launch. And I'm updating the backdrop.
There is a level of mental masturbation here that I rarely get a glimpse into anymore.
First, you should absolutely not be spending 1.5 years building a site and getting to this point. You should have your site done in less than a month if you’re a complete beginner.
Second, 15 designs when you haven’t even proven out the concept, market, or marketing channels? There’s literally an audience that will buy every product. You just have to
Find them
Figure out how to market to them
Figure out how big the market is
Every day that you spend time on design and wait to market, you’re losing market share.
Third, “I’d do better in sales via Twitter and Insta but my follower count is weak”
That’s because you’re not good at organic marketing. Social media is a game of organic marketing.
Get good at some sort of marketing. Paid social, organic social, SEM, recruiting influencers, etc. Your best bet is to go to Instagram or TikTok as they’re the most viral.
Stop everything you’re doing. Design, tweaking logos, backdrop, etc. GET TO MARKETING. That should be the number 1 goal. Figure out how to market and test the audience/market.
Question #3
Is it worth it to sell a homemade product? Going to be doing carbon fiber work for school, so I think I could at least give it a shot to sell this stuff on the interwebs.
This is actually a good way to get started. It only scales so far but it’s the same idea as a service business. Get cash flow up to invest in other things and learn how to build and market. Any one of you reading this could probably turn homemade products into an on demand service business afterwards doing custom work.
I know one girl that was making $20k a year, not even really trying, by selling knitted dog hats on Etsy. She had a ton of competition and didn’t even do marketing after the first few months. There’s that much demand in the world for pretty much anything.
After you know the demand is there, you can also turn homemade products into an on demand service business. Even in a major city where there should be a ton of competition, you’d be shocked at how much I had to pay for my custom wine rack…
Question #4
I want to launch a brand but big success in the beginning is extremely unlikely. Is it better to follow that model or just find products that sell and sell on Amazon? Is it worth the extra effort to white label my own singular product and sell it through my own website?
I don't advocate drop shipping or anything like that. I advocate reselling on Amazon or starting a service business to get your feet wet and build an initial capital base.
Most people don't have the
Capital
Skill
Determination
Or Built in Audience
To pull off building a brand in the beginning.
If you create your own brand, and you should long term, you need an abundance of one or more of the above 4.
The problem with most people is that they don't know how to market. You HAVE TO get good at some marketing channel or have a lot of capital to hire good people.
The other problem that most people have is they're terrified to drop $20k on an idea even if they have it. Which I totally get.
It took me years and years working my way up Corporate America before I was comfortable doing that and risking losing it all. You can avoid a lot of the risk by being good at marketing (point above).
Question #5
Recently built a new site for the company I work for. Our old site was built 8 years ago on Joomlah. The new site is built on WordPress. We used to rank at the top of Google on a handful of search terms. All organic from being on the web for those 8 years... plus being in specific niches. After the switch, we don’t rank on any. Is this normal ? I’ve read on many websites that once you switch site frameworks it does in fact affect SEO and google has to reindex. I’m shocked there’s no historical data somehow tied to our main URL.
This is what you get when you hire website build agencies. Very few actually know anything about SEO.
There are a few things that are necessary for rankings to not take a complete nosedive.
Your main domain has to be the same. https://domain.com can’t just switch to https://www.domain.com without having redirects that tie everything together.
The URL of the old pages have to be the exact same as the new. Even the trailing slash if there was one needs to be there. If not, there needs to be permanent (301) redirects in place from the old URL to the new URL. You’ll lose rankings if you do this but not nearly as bad as not redirecting the URLs.
Any pages that were on the old site need to be on the new site. If you take away a page for whatever reason, there needs to be redirects in place to the closest page.
Meta descriptions & Headers should be the same on each page. You can change these but there’s no telling how little (or much) Google will change the ranking of a page if you do.
Here’s some things you need to remember if you’re rebuilding a site.
Google ranks an individual URL. The URL is what gets the ranking. You change that URL and it’s a completely different page. Meaning it starts back at 0. This can be negated some with a URL redirect from old page to new page.
Historical data matters. A LOT. Google has historical data on each and every page. When that page disappears, so does the historical data that Google is using to rank you. Again. Redirects.
Link juice matters. A LOT. If you don’t have redirects for every link coming to your site, and internal links, you’ve now lost all of your link juice. Cool. Your 404 page will have a lot of link juice but that’s not helping the rest of your site. An estimate is 80% of that link juice will flow to the new page with a 301 redirect.
Even the trailing slash needs to be the same in the URL or Google will view it as a different page
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Disclaimer: Nothing written here should be construed as legal for financial advice of any kind. These are opinions and observations, written by an anonymous cartoon Opossum, built up over years working in e-commerce & affiliate marketing.