48 Comments

1. # Andrew Crosson 05 Mar 2007 at 9:50 pm

   AD1 looks the winner, lower costs, higher conv rate. maybe needs minor tweaking though.

2. # Danon 05 Mar 2007 at 9:55 pm

   Well, it looks like you would expect most to select #1, so, assuming I’m right, there must be something about ad #2 you haven’t told us yet!

   Dan

3. # Erik Johnsenon 05 Mar 2007 at 9:57 pm

   The costs of AD 1 appear to making up for the lower impression and click-through rate. The better conversion rate combined with the lower cost-per-sale appear to make AD 1 a better choice over the second one.

4. # Danon 05 Mar 2007 at 10:01 pm

   O yeah, and it’s likely because of the CTR, you would want to use the “lead in” from ad two and the “close” from ad one
   Dan

5. # Karenon 05 Mar 2007 at 10:04 pm

   I would say it depends on the response you’re looking for. If the idea is to drive purely visitors to the site – for example, if you’re looking for ezine signups – then ad 2 may be preferable, despite the higher cost.

   If you’re driving traffic to a sales page, it also depends on whether there’s a higher onpage conversion ratio from one ad to the other…

6. # Ronaldon 05 Mar 2007 at 10:09 pm

   Conversion rate looks better in ad 1

7. # Caronon 05 Mar 2007 at 10:12 pm

   I agree with Eric Johnson.

8. # Reinhold Hesson 05 Mar 2007 at 10:26 pm

   It looks to me Ad2, because it has a lower convertion rate, but brings in a lot more profit from your $27 sales item.

9. # Annon 05 Mar 2007 at 10:30 pm

   Ad 1 I agree with Andrew Cross

10. # Grahamon 05 Mar 2007 at 10:32 pm

    I am going to pick Add 2

11. # Grumpyon 05 Mar 2007 at 10:37 pm

    I really have no idea.
    What is a % served?
    I couldn’t afford to use ads as I can’t imagine anyone clicking on them and you could never sell enough to get your money back. Nobody ever clicks on affiliate links so why would they click on an obvious scam?.
    If they are used to drive people to the site surely they go away as soon as they realise that it’s another ‘information product’ that’s only designed to line the seller’s pocket.

12. # Markon 05 Mar 2007 at 10:39 pm

    I would say ad 1 even with the lower ctr the conversion rate is better. But why if you are split testing would you let a campain go that many clicks?

13. # Joe Laveryon 05 Mar 2007 at 10:48 pm

    Most are saying Ad 1.

    I think they’re wrong.

    In my opinion, ad 2 is the winner because it costs $8.58 cents to generate each NEW customer… so you are making a profit.

    If you’re making a profit AT ALL – I’d go with the add getting the MOST clicks, period.

    The BACK-END is where all the real money is made so the MORE PROSPECTS/LEADS/CUSTOMERS you can get into your FOLLOW-UP LOOP – the FASTER your business will grow and the MORE PROFIT you make in the long run (or even the short run if you’re good at email marketing).

    This is true even if you’re front-end profit margin is much lower.

    If it’s at break even – it’s a winner.

    And if you don’t have a backend or know what one is – get a clue before you lose your shirt at PPC. It’s easy to lose a ton of dough if you don’t know what you’re doing.

    Joe Lavery
    http://www.backendsecrets.com

14. # Markon 05 Mar 2007 at 11:03 pm

    If you dont look too closely, add one seams to be the best bet. But when you take the clicks per inpresion into acount add two is getting a far higher response.This being the case it is fair to asume that even with the lower conversion rate it is a smaller percentage of a greater number of people therefore more sales and hence more money. It only proves the saying that lots of little profits are better than one big one,as you will have follow up details for mailshots in the future.

15. # Rickon 05 Mar 2007 at 11:04 pm

    It looks like ad# 1 is the clear winner here, lower cost per sale = more money in your pocket

16. # johnon 05 Mar 2007 at 11:10 pm

    AD2 definately – although it has a lower conversion rate it has more clicks so the eventual sales are higher.
    AD1 4705 less 451 is 4254
    AD2 7087 less 826 is 7261
    451 x 27 = 12177
    826 x 27 = 22302
    sounds good

17. # John Collinson 05 Mar 2007 at 11:16 pm

    Hi Socrates –

    Sorry to answer a question with a question but when doing a split test isn’t the person clicking the ad only seeing one of the two. How do you know the person that clicked on AD 1 would have clicked on AD 2 and the other way around. I’d use both.

18. # Socrates Socratouson 05 Mar 2007 at 11:25 pm

    Thanks for your responses so far. Please keep them coming. I ‘d love to see some reasoning behind your choice.

    Grumpy, this is not a scam. This is a profitable campaign, and obviously made a lot of sales.

    I will be getting more into paid advertising and PPC in upcoming posts.

    Keep posting your comments, and dont forget to check back for my analysis soon.

    Regards,
    -Socrates
    P.S. Feel free to ask your friends to take a look and post their comments too.

19. # alley55on 05 Mar 2007 at 11:38 pm

    i have no idea,sorry

20. # Lawrenceon 05 Mar 2007 at 11:59 pm

    Ad2 is getting the most results even though it’s dearer and the per centage is down, overall a far better result.

21. # Jeanon 06 Mar 2007 at 12:06 am

    The only obvious thing about this is that if you are asking the question with clear cut differences in the examples the answer is not going to be obvious!!!! So I am going for AD2 and wait for your answer.

22. # Papajoon 06 Mar 2007 at 12:21 am

    I am of mind to think thar Ad2 would work better. Alot of the time folks actually look at the cost. If your cost is to small they may tend to think it might be a rip off But if the cost is a bit more they may think that you might actually no what you are talking about and possibly be selling a worth while product.

    It’s my belief that when you end up paying less for something you get exactly that. You always get what you pay for.

    To me, more likely than not the more folks seeing your ad wether they make a purchase or not, they will tend to tell others who inturn wil look at what you have. Thus far causing the domino effect, which will in the long run bring more visitors to your site.

23. # Jameson 06 Mar 2007 at 12:24 am

    I agree with John, Ad #2 is the winner even though ad #1 looks like the winner to most people answering this question.

24. # David Larsonon 06 Mar 2007 at 1:01 am

    I would say that ad 1 is clearly the winner- you have paid $451 and made $1407 profit. Ad 2 has yoou paying $720 and making $1510 profit. The ROI on ad 1 is 311%, and the ROI on ad 2 is only 209% profit. What to do, though- ad 2 is clearly getting many more clicks, but they are not converting. Ad 1, with less clicks, is converting much better. Is ad 2 too general, picking up more clicks than clickthroughs, while ad 1 converts more of the people who click on it (better focused on the product, perhaps?).
    I am a newbie at all this, having lost a small amount of money on google, but learning some things, I hope.

25. # Graphicon 06 Mar 2007 at 1:22 am

    OK I’ll put my foot in my mouth and say Ad1 is the more effective, because even with a lower amount of clicks and some 30%+ less cost of the ad but with a higher ratio of sales conversions.

    My intuition then whisperingly said, so it has to be Ad2 Why………I have no idea.

26. # Markon 06 Mar 2007 at 2:04 am

    I would have to say Ad 2, it is only common sense $$$

27. # Roger Davison 06 Mar 2007 at 2:48 am

    Hi,

    I’ll stick my neck out and say ad 1 – on certain conditions.

    The CPC is around 5.2c for both ads, so that’s constant. I presume the timescale is the same for both campaigns? Therefore the only time ad 2 wins is in the overall profit for that time period.

    ad1 income=$1858 profit=$1407

    ad2 income=$2230 profit=$1509

    So on the surface, ad 2 has made more in the same time period (albeit with greater outlay, but this is moot as adwords is paid in arrears.)

    BUT –

    ad 1 wins on these figures –

    clicks to earn a dollar –

    ad1 = 6.11 clicks to earn a $
    ad2 = 9.12 clicks to earn a $

    If you reverse the stats –

    dollars earnt per click –

    ad1 = $.16 per click
    ad2 = $.10 per click

    The key factor (as mentioned above) is this –

    If this was a campaign of the ‘google cash’ variety (driving direct to affiliate) you’d choose ad 2 because of the profit made.

    But if this was to drive to a product of your own, therefore you are building your customer base, and earning on the back-end, then ad 1 wins because of this –

    cost per conv. = $6.84

    The deciding factor is whether you’re looking purely for profit (affiliate = ad 2) or looking to build a business (own product and opt in = ad 1).

    There ya go 🙂

    Roger.

28. # Jimon 06 Mar 2007 at 3:05 am

    The answer should be Ad 2.

    -5,165 more clicks which equals more interest in product
    -48,035 more impressions = more exporsure and possibly better keywords
    -14 more conversions @ $27 = $378 more sales
    -ad cost increase over ad1 = ($269)
    -Net profit increase before other exp =$109

    Assuming with continued advertising this trend continues the difference would be componded.

29. # Old Davyon 06 Mar 2007 at 4:21 am

    I’m new to this PPC business, but as a newbie I would go with Ad 2.

    Keep me posted! I want to learn more about this when I start using Adsense to generate sales.
    Davy

30. # Billon 06 Mar 2007 at 5:20 am

    I’d say both were a success. But the real question is how you to manage to get a .06 and .08 conversion rate.

    Like many have mentioned, backend would be a huge factor so the higher numbers could be worth the additional cost.

    I also noticed the you have a little over 30% shown on each ad. So where’s the the other 30%?

    Need more data to make a real choice but most would be happy with either set of numbers.

31. # Ertacon 06 Mar 2007 at 5:20 am

    Hey Socrat!

    Why dont you try to look at your mydd tickets..? I received zero support .. Just newsletter SPAMS…

    Pft…

    You scammers…

    No Regards…

32. # Elizabethon 06 Mar 2007 at 5:26 am

    First off some people are forgetting the purpose of an ad. An ad is not to sell anything. It should not be designed to sell at all. It should be totally designed to spark interest and drive taffic.

    How the ad is written determines the quality and reasoning it is being clicked. Everyone is trying to determine the ROI and that is not always a cut and dried case. There is no way of telling how many individuals where exposed more than once to either ad or both.

    The way AD1 is written could mean it is more focused on indivudals who are posed to buy and hence a lower cost per click but then ad two is driving more visits but a lower conversion. It could be that ad two is tweaking individuals to click but they are not finding what they are looking for on the sales page.

    Try looking ad AD2 and see how it fits with your sales page. It could be that you need some adjustments on your sale page.

    Oh yeah, this was a problem in math wasn’t it? You still have to look at that the variables.

    Right now there is a big war going on between business and advertising on how to actually measure ROI because there are so many different variables that must be taken into account. Advertising on the internet makes it a little easier to figure ROI but once again there are so many variables to consider you could drive yourself nuts.

    There is also the fact that AD2 is driving clicks that AD1 never would get and vise versa. Getting rid of either ad could result in the loss the sales it is achieving. If the product is a digital product then total sales between the two is more important than losing sales because you dropped one ad. If this is a long term campaign drop one add and see if total sales increase.

33. # Brendanon 06 Mar 2007 at 5:49 am

    I would pick ad 1 because of lower cost/conv and and higher converion rate; click rate not very important if not directly proportional to the conversion rate. The winner is the one who brings in better profits

34. # Larry Johnsonon 06 Mar 2007 at 7:24 am

    Hi Socrates,
    I would say BOTH of them are basically good, however, having to decide one way or the other at this point isn’t feasible because the placement of the ads (1&2) will have a determining factor of how well the individual ad does.Just switch placement of each ad, run for at least a week or more and then you will have a better idea of the ad to be dropped. (If either)

35. # Freda Plancichon 06 Mar 2007 at 10:20 am

    I think your ad#2 will make you more money in the long run. Here is how I arrived at my conclusion:
    I took the number of clicks times the conversion rate which gave me the number of books sold. I then took the number of books sold times the selling price and deducted the cost per book to arrive at my answer which is:
    Ad#1 $13,873.31 and Ad#2 $15,215.29. Having said all this, I am a newbie and perhaps I didn’t do this right, but it makes sense to me that the bottom line is the money made, and that was the question, not the process of acquiring new names. However, Ad#2 would still have given you more names as well.

36. # Frank Haywoodon 06 Mar 2007 at 1:05 pm

    Based on simple maths it’s ad 2.

    Ad 2 delivers more than $1500 in profit, while ad 1 delivers less than $1400.

    There’s a lot more to it than that, in backend sales and knowing your metrics and customer lifetime value. You actually want more customers and more sales not less.

    Ad 2 delivers both more initial profit, and because there are more customers in your funnel, more money on the back end sales.

    I could write a book on this…

    😉

37. # Andion 06 Mar 2007 at 1:58 pm

    After little raw calculation Ad2 give you better profit,but Ad1 havemuch better rate of invest/earn.I will keep both,they make profit

38. # Tonyon 06 Mar 2007 at 2:43 pm

    It appears to be Ad No. 1, however, as these things go, there must be a “catch” to it. So, I suspect that it is Ad No. 2 and that there is an explanation for it.

39. # Sunnieon 06 Mar 2007 at 5:17 pm

    I am going to have to agree with PapaJo adn Andi, as Even though ad1 looks pretty solid, ad2 brought in more customers per click. More revenue, end of story.

40. # Gregon 06 Mar 2007 at 5:53 pm

    Number 1

    Higher conversion ratio and best price per conv

41. # Frank Edwardson 06 Mar 2007 at 6:24 pm

    Number 1. More clicks seemingly leading to more money, end of story.

42. # Frank Haywoodon 07 Mar 2007 at 3:18 am

    I’m really surprised at some of the answers since I posted.

    DO. THE. MATHS.

    It’s got nothing to do with the fact that ad 1 has better conversion. And Socrates isn’t going to keep both ads running, that’s the point of this exercise!

    (Yes I know he will run another one to try to beat his control…)

    Ad 2 delivers MORE CUSTOMERS and MORE PROFIT.

    In business, you want BOTH.

    The better conversion and cost per conversion for ad 1 is unimportant as ad 2 is clearly the better performer in terms of CUSTOMERS and PROFIT.

    May God help your businesses if you can’t see this.

    😉

43. # Reynold Tanon 07 Mar 2007 at 6:59 pm

    Both ad hv it good point,if I hv money I will choose Ad 2.If I hv a choice to invest and can allow me to repay you after I hv earn the money in Ad than I may choose Ad 2 to do this business investment. At this time I really really hv no money to continue pay the ad if required ad business or also to pay any mentor training fee required so as to continue to do this ad or sale marketing buinsess.
    Keep this matter bet us only.
    thank you
    Reynold Tan

44. # Steve Galbraithon 07 Mar 2007 at 9:30 pm

    I like Ad 2’s potential. Ad 1’s output is smaller, true, with a better % profit ratio, but the CTR impresses me with Ad 2 because of it’s exponential possibilities down the road as back-end referrals will recycle profits over and over. The key is optimizing the ads so the web spiders can take the banners and spread them throughout the google world of cyberspace and bring an attractive number of browsers to your site, which will bring in buyers and that customer database will exponentially grow, contingent on the usefulness and vitality of the product being sold.

45. # Rajeshon 07 Mar 2007 at 10:01 pm

    Hi,

    The second campaign is more profitable as it’s giving a profit of 1509.434 dollars whereas the first campaign is giving a profit of 1384.57.

    For first campaign the calculation for profit is

    .008×8602=68 (no. of sales) x 27 (profit from each sales) = 1836 dollars – 451.43 (cost to run the first campaign) = 1384.57 dollars

    Similarly for the second campign, the profit is calculated from this formula-

    0.006×13,767= 82.602 (no.of sales) x 27 (profit from each sales) = 2230.254 dollars – 720.82 dollars (cost of running the 2nd campaign) = 1509.434 dollars

    Hence from the above results, second campaign is more profitable (as per my understanding)

    Rajesh

46. # Henry Stemkeon 07 Mar 2007 at 10:17 pm

    I really don’t understand this.

    Sorry.

    Henry

47. # Marleneon 08 Mar 2007 at 12:04 pm

    I would go for ad2, the more the merrier as the saying goes!

    Seriously, I am a newbie and from what I understand a lot of clicks to your website is very good news. If you are making money while getting visitors to your site it is like having your cake and eating it.

48. # Stuarton 08 Mar 2007 at 4:15 pm

    What a blog..This is so HELPFUL. I am using these methods in a test campaign where I am working from scratch and working towards $4,500. I am currently half way nthere on day 18

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