Speech by Kyle Constantin | Managing Partner, Codeface Media
Kyle Constantin Speech Transcript
Alright, so I’m here to talk briefly about how to scale e-commerce on native ads.
I don’t have a whole lot of time, so I’m gonna do a very brief case study. And then talk about the general scaling process that you would take on many of the top native ad platforms.
Affiliate Marketer For 5 Years
So super short bio here, I’ve been an affiliate marketer for about 5 years now. I’ve gone through many of the big affiliate waves, from dating to app installs, binary, nutra.
And as many of you have probably faced, you end up having to start over quite a lot when you’re running some of these niches. Frankly, I started getting tired of it and I said, “Okay, let’s try to build something a little bit more sustainable.”
I’m in China, pretty much everything the world is made in China, so let’s take a stab at e-commerce.
So the biggest question when you’re starting with e-commerce though, is product selection.
How do you choose products that will work? Especially on native because native tends to be quite expensive.
So the number one thing that we’re looking for here is broad appeal. Many of you, if you’ve run native in the past, you’ll know that you have very limited targeting options.
You need a product that has extremely broad appeal. These are the kinds of things that if you were going to do a Facebook campaign, you would target all men and women over 35. Or all men and women over 30 or something huge scale.
You need higher payouts due to the higher click cost that you’re dealing with. I generally would not try a product anywhere less than $20.
We usually go more to the $40 to $60 range before we do our up-sells and cross-sells.
If you can get any moat possibilities built-in, meaning a moat around your sales funnel.
Either through the advertiser, the actual owner of the product if you’re doing affiliate, gives you an exclusive on that traffic source, which has happened in the past.
Or you have your supply chain tight enough that someone can’t just go on eBay and do your entire sales funnel right away.
You need to have either cap or inventory, able to push up to five figures.
Because you really don’t want to be in a situation where you’re paying for all these media. And then suddenly you have no way to fulfill any of these orders because your supplier only has a hundred of this product.
That, you never want to have, you’ll waste a ton of cash on that.
Test Many Products
And it’s important to test many, many products. When you’re first trying out, you might have one that seems like it has a little bit of success but you don’t really have a baseline yet.
So it’s good to test or put aside a set budget. And test many products before choosing which ones to scale as big as possible. That way you can also have the potential of having several products that you’re able to scale up.
Alright, so I have a brief example of how you would take a product, then test it and then optimise it. And then, keep scaling it long-term.
Example: Bluetooth Personal Tracker
So here’s just an example product that we’ve tested in the past. It’s a Bluetooth personal tracker. They cost consumers about $65. We started off with the advertisers landing page, later on, we made some custom variations.
We’re trying on Taboola, but any large major traffic source would be fine. And we tried a bunch of different angles, right?
And this is of course very important. You want to cast as wide of a net as possible, so if you lose your keys frequently or your wallet or your phone, this thing could help you find them.
We also had an angle where you can use it for tracking your kids even.
There’s the forgetful-people angle. Look at this breakthrough startup in this cool technology that they have. We tested a bunch here.
So it’s important to make sure that your angles will follow through you’re creative as well. This is just showing you how we implemented these angles in the creative.
Example: Angles In Creative
It’s probably pretty obvious that these are native because you end up having like big arrows that necessarily don’t look good but they just get higher CTR. These tricks are also important to try out.
Alright, so how do we set this one live? How did we do this?
How Do We Do This
Well, we definitely wanted to focus on English-speaking countries first, because that’s where the advertiser told us most of the sales were coming from. And we added in Germany because that was a good one as well from them.
We started off direct link because we just wanted to get a baseline, we wanted to figure out which device types will work the best. Mobile versus desktop and tablet, as well. And which countries we should focus on first.
So we’re gonna keep any country that lost less than half of the test budget.
Initial Result: Focus On Desktop
Our initial results from that test, we had to focus on UK and Canada. And the goal was to scale to the US.
Now, with native traffic, the US tends to be quite expensive. If you have a product that’s only able to be sent to the US or you’re doing something for example with the e-packet shipping method, which is quite good for China to US, then you can dive right in.
But for this particular funnel, we decided to start in less expensive geo’s. Then optimise the funnel and then port it over to the US.
How To Optimize It
So how do we optimise it?
Of course we start with the largest factors first. You want to get the maximum bang for our buck. So, we wanted to focus on getting cheap clicks.
So that we can then use the cheap clicks to run all sorts of A/B tests on the funnel.
We nailed down the angle, we nailed down the device type. And we nailed down the country.
Then, within the angle, we’re studying our high CTR ads. Not necessarily which ads have the highest CTR, but what is the psychology driving the CTR between those ads.
Maybe you can take the super high CTR from one angle that didn’t necessarily convert the best and move it over to one of your other angles just by following the exact same psychology from the creative.
Use Dynamic Tokens
It’s also very important to use dynamic tokens. This is pretty standard if you’re running any sort of native campaign.
But you don’t have much to optimise on. So be sure to get those dynamic tokens tracking right into the volume or into whatever tracking system you’re using.
They’re pretty priceless for the creative and site ID testing and when you create your blacklist as well, which I’ll talk about in a minute.
Intermediate Conversion Metrics
Intermediate conversion metrics are very useful. I told you here that you should be running relatively more expensive products compared to like an iPhone lead gen or something like that.
And so, an intermediate conversion metric can be a great way to get a lot of data early on without having to wait until you have 40, 50, 60 actual purchases.
So I’ll talk more about how to do that and where we did that, shortly.
Another way you can do it, another good way to optimise is, once you see which categories are starting to work, so Revcontent does this, Taboola, a bunch of others offer the campaign category or at least the category of sites that the campaign is being shown in.
Sometimes there will be certain categories that just have really, really bad CTRs. And other ones that are just performing great for you.
So it’s the low ones that can actually really bring down the rest and the algorithm will punish you for this. And so, once you have an idea of which categories seem to be working well, it’s good to break them out into their own campaigns.
Bots And Bot Traffic
Okay, another thing that definitely needs to be talked about is bots and bot traffic.
If you’re doing some of the higher-end native networks, for example, Outbrain Taboola, Revcontent, branded stuff, you don’t need to worry too much about this.
But if you’re anywhere else, then it’s definitely a factor.
So what we do is we set up a system of rules. And then we have a report that runs on all the traffic and if you pass this test, this test, this test, okay, it’s not a bot.
If it fails say 2 out of 5 five tests, okay, it’s highly likely to be a bot.
And so the thing with this is, what do you do once you know that you’re getting bot traffic. Well, the main thing we do is we use it as earlier metric for possibly blacklisting a site earlier than we would normally.
That is to say, we don’t want to blacklist a site if it has lots of bots but it’s still profitable, it’s fine.
We usually just leave it in that case. But it’s good to at least know what you’re dealing with the traffic you’re buying.
So for LP testing, you want to test widely as possible just like we’re doing with the angles.
We want to make sure we’re testing an advertorial style, a video sales page. And, we want to test directly to the product itself. Also, we want to spy a little bit.
Now, the spying I’m talking about here would be just going into your volume refers after you’ve been running traffic for a little bit and you have the converting site IDs.
And then, check out the refers, match up the site IDs by like going into the source. You just check wherever the Revcontent widget is or the Taboola widget, and it’ll match up to the site ID that it sends to you.
This is a really good way to get ideas for more advertorials.
Because you know the exact type of content that you’re your highest converting sites are giving to the readers.
And so you can do something more in the style of them, if you’re catering to, for example, on a network like Taboola where 90% of the traffic comes from MSN.
It’s a very useful way to come up with ideas.
Intermediate Conversion Metrics
Intermediate conversion metrics, we’re back to this. So, typically we set it up on either the Add to Cart or on the click-through on the advertorial itself.
And so by moving it forward, you actually get a magnitude more of data early on.
This is very, very useful, especially if you’re using the conversion pixels given by the traffic sources themselves.
Another thing very important for all your LP testing, I do this kind of a standard practice now. And my partners actually laugh at me for it sometimes, is FK readability.
This is the Flesch-Kinkade scale for readability.
People have probably talked about this in the past. But essentially what it is, is it tells you what reading level your ad copy is. What grade level it would be.
And this is actually a function built right into word. But there are also other apps that can do this really well.
The one I usually use and I think real copywriters will laugh at this, but there’s one called a Hemingway app.
And for me, it just does the job really well. I’ll write up the ad copy, I’ll put it into Hemingway. And, it’ll turn sentences red if they’re like really confusing.
It’ll turn them yellow if they’re a little bit confusing. And, so usually I can bring down the grade level from around like a 10th-grade reading level.
If I can bring it down to under 5th grade, then I know that of this broad traffic that’s coming in, they’re going to immediately understand at least the offer that I’m providing.
Because you only get a few seconds to engage these people, especially when you’re giving them really strong click-bait headlines. And, so it’s good to bring the reading level as low as possible to make sure people are understanding what you’re saying.
Okay, creative testing obviously this is the same stuff you can do for non-e-commerce.
But the thing is, you can’t steal directly because the chances of someone having the same product as you when you’re doing e-commerce is pretty much zero.
So, yeah you can read BuzzFeed and get some template ideas. You can read copy bloggers and understand or the psychology behind different headline styles.
If you’re gonna spy using spy tools, copy but tweak it a bit, right? Because the chances are that the stuff you’ve seen there has been used for something. Somewhat like what you’re doing but not exactly the same. It could already be burned out on the network.
It’s just worth it to at least split test, their version versus your own version of what they did.
And then again, this is a kind of a standard native tip. You want to Photoshop all your images to make them pop a little bit more.
I believe that there was a guide, for those of you that are on STM, about how to do this in detail with all the different Photoshop tricks.
But the general, safe one is just go to vibrance and jack up the vibrance quite a bit. And that’ll help a lot.
Scaling Up: Traffic Source
So how do you scale up with e-commerce? Well, the good thing about e-commerce is that, because you’re doing pretty much everything above board, you can go with the top traffic.
You don’t really need to be fighting against people on the cheapest traffic possible on Adblade or something like that.
The good thing about that is you can get the branded campaigns from, for example, Revcontent. You can get on Outbrain and you can get on all this good traffic.
To optimise it, still, stick with a standard kind of blacklist of the rundown network. And then moving over all your good stuff into white-list campaigns.
If you want to get very granular about it. Or if you’re on Revcontent, they have a really good API so you could do this programmatically, where you just sort things into basically different tranches by like how much profit they’re giving you.
So if you can put higher bids to those sites that are really, really converting well. And then basically make almost per site bids.
Conversion pixels, I put a star next to it just because some people are very uncomfortable with sending back data to these traffic sources.
When I use intermediate conversion metrics and I have built my moats, so I know it’s very hard for them to get my supplier, I have a very complex funnel, I usually don’t care.
Because the conversion pixels, at least in my experience, have done a lot of benefits. And if you’re on a platform like Yahoo Gemini, there’s not much you can even do to optimize.
So you pretty much have to use their conversion pixel.
This is at the point where you’ve pretty much gone through all the basic steps of optimization. And, this is the point where you could go back and try scaling to the US or try scaling to any of your other geo’s.
Try building out the mobile part, even though the mobile part did more poorly in the beginning.
Tip: Maintain High Account Balance
And, this is one small tip for most of the native platforms that I’ve worked on in the past, are you in need to maintain a surprisingly high account balance.
Because the algorithm will punish you if it believes that it might have to go negative to deliver your traffic.
Generally, I’ve heard anywhere between $2,000 to $3,000, for say, Revcontent. And Taboola, I would probably do even more.
Just make sure you don’t come anywhere near to empty. And, the algorithm will not punish you.
Scaling Up: Offer/Product
Okay, now on the offer product side. Obviously, the clearest way to scale up is to roll your own offer. So check out Aliexpress for dropshipping, eBay, Global Sources, these are all places where you can find tons and tons of products.
If you see, for example, something on Facebook right now, where people are doing tons of these free plus shipping things, you can probably just search the direct term into global sources or Aliexpress.
And find exactly the guy they’re buying it from.
So when you do find a good supplier of the product, definitely, rate them on communication.
I had a situation just a few weeks ago where we were scaling up a particular product, and we started having an issue. Because we needed some feedback on what happened with a particular set of orders. It was essentially impossible to reach the Chinese supplier.
And this is even with me being in China and using all possible back roads to contact them. And so needless to say we found one who was, I think, it was like 10 cents more expensive per unit.
And now, we just do all our business with them because they actually reply to our emails and we know we’re not screwed if something bad happens.
Definitely, push for better terms then you’ll get off eBay or Global Sources. But only do it once you actually have real sales.
Let Them Know You’re Real
This is kind of common sense, you need to show them that you’re a real customer, a real client before you can get them to push, for example, free shipping or a locked in a much lower rate on all product.
Now, if you are doing some work directly with a client that owns a product or you’re doing an affiliate-related sale, then it’s a probably a smart idea to pass angle IDs, device type IDs, traffic source IDs.
I definitely say IDs right. I’m not telling you, say, “Oh yeah, I’m doing this angle, it’s working great. Here’s my traffic source.”
Don’t give your campaign away, obviously. Use an ID say like, “Oh, traffic source 1, traffic source 2, traffic source 3.”
And that way, not only can they tell you when it’s not working. But they could say, “Hey, traffic source 2 is doing great. Let’s like pump up the volume on that. And I’ll boost up your per product sale by 5 bucks.”
If you’re not sending your data in a granular fashion like that, it’s impossible for them and for you to see where the real money is in the campaign.
Okay, this is very, very crucial. It’s not necessarily easy to do, but do whatever you can to get an account manager.
Scaling Up: Get An Account Manager
Once you have a campaign that’s working at a source that you like, get an Account Manager ASAP.
They give you constant feedback. And, they can tell you, for example, if you get your ads rejected for some weird reason, they’ll tell you what the real reason is. And they’ll push your stuff to the front of the queue.
It makes life infinitely easier.
For those the bot reports that I was talking about before, if you have a good rep, you can send the bot report over to the rep. Ad get a refund on all your bot traffic.
Faster ad approvals like I said. Let’s say, you want to take this campaign that you’re running and you have it now in the US, UK and Canada.
Okay, you want to test out some European countries. If you have a good rep, they’ll give you a list of sites, say “Hey, like this is like a standard blacklist for Switzerland. Just like block these off the bat. And you won’t have to waste your budget.”
You can get really, really good tips from Account Managers.
So do whatever you can to get one.
Scaling Up: Continuous Funnel Optimisation
Okay, and then just ongoing, this is something you’ll be doing throughout the entire life of the e-commerce store or the product, if you’re just pushing individual products.
Generally, for e-commerce, you’re on native and on other platforms. You’re not going to be using volume or attractive systems like that so much. It tends to be more either mixed panel or even just Google Analytics.
Google Analytics has a really, really strong e-commerce components. And a lot of our experiments we just do right in there.
So, what we do is we focus on getting as many people clicking through on the advertorial. And then we worry about the rest then.
Once we have people clicking through, then we can worry about how exactly we’re monetising to get the maximum revenue per user.
But first, we definitely start at the advertorial itself.
Once you have that tweaked, then you can worry about your shopping cart up-sells. We like to do the shopping cart up-sells mostly after the CC has been entered after they’ve already submitted the credit card.
And this is really, really powerful. Because you can test pretty much anything. And yes, it could not do as well as something else but it will never jeopardise the sale because the sale has already been made.
And so, even if they just exit your website at that point, they’ve already submitted their credit card for the first product. And so it’s one-click up-sells after the sale.
That has been huge for us, that’s helped a lot.
Buy One, Get One, Percentage Discounts
Then, you can also experiment with buy one get one, percentage discounts. All this stuff has been very good for our revenue per visitor.
If you’re doing mobile, which you definitely should be checking out because a lot of native ads inventory is strictly mobile. Definitely, do some speed optimisation.
This is kind of standard operating procedure for mobile. Definitely, do that.
If you’re running on a system like ClickFunnels, for example, which is great for building out funnels.
Once you have a tweaked funnel and if it’s mobile-focused and you have a tweaked funnel already, I would even suggest getting that funnel done in the actual code.
Because you’re gonna get a huge boost just by having it in optimised code instead of this WYSIWYG funnel.
Once you’re at that point, then you can worry about the re-targeting of your customers and the long-term value there. Through email marketing and abandoned carts and building out your newsletter and all this kind of stuff.
Okay so here’s just a couple tool recommendations. There’s a lot of stuff in the space, so this is just stuff that we’ve used that we found works really well.
You can try it out for your own system and see how it works.
Yeah, not too much else to say. I guess that’s all I’ve got.
So, thank you.