Lesson 2 Reflection - Supply[ers] & Demand

DEMAND

We started getting into the basics of google Adwords:
google.com/adwords
> Tools and Analysis > Keyword Planner
The Project 1 excel spreadsheet: Web Business decision Matrix is a great tool for comparing ideas and keeping them in a concise spot. I have the file stored in my docs and believe I will refer to it a lot in the future to evaluate different business ideas.

I did get very frustrated this week when I felt like the information I was getting from the Keyword Planner wasn't making any sense but the time Brother Poole took to walk me through things during his office hours helped me gain greater insight. I hope to do a quick video tutorial for myself of what I learned during that session but that just may have to wait. Here are some of my notes for now:

What is a good number of average searches or a good price per click?
It depends (I hate that answer but its the only accurate answer).
Think in terms of customer accusation. You need to figure out how many clicks it takes to acquire a customer (lead conversion rate). [1 in 10, 1 in 500, etc] Also you need to know how much a customer is worth to you. Probably start with the value of the customer first. As far as a product not having very many monthly searches, keep in mind that there are searches. Those will be highly targeted searches, meaning, there aren't a lot looking for it but if you have what they are looking for, it might be worth going after.

Note: as an exercise, think in bigger numbers: my total ad spend is 50k a month but it brings in 2 million a year. Understanding the above paragraph can get to that point.

BID RATE
Bid Rate is based on quality score. So you may be charged a different price than someone else for the same click. Why:

Quality score is a 0 - 10 number that google gives you based on how relevant your ads are and the quality of your website, etc. Calculate bid rate = Quality Score x Max Bid.

7 x $2 = 14 Bid Rate (Winner, ie their add will appear higher while paying less per click)
3 x $4 = 12 Bid Rate

Click Cost Curve

Determine the best Bid Amount:
The best value per click is bidding before the curve levels off. From the spot indicated (.10) to about 1.75, all of those clicks cost a lot more per click than the first 105 clicks.

So look over to the right. At $.10,  you're paying that price per click for about 105 clicks. Your next 15 clicks or so are going to cost anywhere from $.10 to $1.75. Then from $1.75 to $3, the graph jumps up again so you are getting a lot of clicks for a relatively similar amount. Sounds confusing but its pretty simple.

The point is, Not every click is of the same value. The first x# of clicks cost $x per click next 1000 or so cost more per click.

In the example above, $.10 = about 110 clicks. If you assume 3% conversion rate, it will cost you $10 for 3 customers.

Higher bids do not correlate to more clicks.

GOOGLE TRENDS
How have I never known about this:
http://www.google.com/trends/

SUPPLY [ERS]:

How to Find a Wholesale Distributor
http://onlinebusiness.about.com/od/findinggoodstosell/a/buy-wholesale.htm

International Brokers (try to add to this list):
alibaba.com
globalsources.com
smallvolume.com
gowholesale.com


US Wholesaler:
Would like to find more like this one for other products:
http://www.lawholesaledist.com/


Affiliate Networks:
Commission Junction
ClickBank
LinkShare
Affiliate Window (uk)
ClickBooth
Amazon
Sharesale
GoogleAffiliate Network
OurFreeStuff

Drop Shipping:
http://www.tamingthebeast.net/articles3/drop-shipping-ecommerce.htm

Good Articles:

Zero to a  Million Users Dropbox and Xobni lessons learned 

Amazon Associates Program (click through all the “Continues” and be prepared to explain this program)

Bass Pro Shops Affiliate Program

REI Affiliate Program

Entrepreneur.com on drop shipping and/or MyMiracleBaby.com drop shipping program and/or Drop Shipping PowerPoint 

productsourcing.com 

Advance preparation: 

7 Things for a New Affiliate Site

What should I know as an affiliate advertiser?

Lesson 1 Reflection - Ready, Fire, Aim

Ready, Fire, Aim.

I don’t know if there is a public access link to that video but I sure hope there is so I can watch it years from now and feel the same excitement I felt last week. As I watched it, I felt like I was back in IBC, learning from Brother Kent Lundin. This course wasn’t available to me then but I remember him mentioning rumblings of it. It excited me then, but I didn’t have the wherewithal to pursue it correctly. Hopefully I do now, and stick with it. A big part of my problem has been that I recognized that I didn’t know it all. But the whole point of this video is to accept that you don’t have all the answers and go for it anyway. You’ll figure it out when you figure it out.

Online Businesses Don’t Have to Sell a Product

It took reading the case study and doing the Demand & Competition research for me to realize that you can make money from an information website just as easy as selling a physical product. I still have my heart set on drop shipping a product, but definitely want to give an informational site a try. Actually I’d like to give a lot of the Business Models a try as found on the following website.

These first two links, I think I will wear out the link referencing them so often:

Business Models on the Web  

BizThoughts Brainstorming Business Ideas

And then just a good reminder of old Russell Brunson’s formula:

Russell Brunson and his Secret Magic Box

Keyword Planner - DEMAND AND COMPETITION

The piece of data that swayed my was using the keyword planner

(keyword planner video help: How to Use the Google Keyword Planner for SEO )

to see that ‘chess’ generates something like 800k US searches per month, most of which are low competition. VS ‘snowboard’ which had closer to 200k US searches per month which were mostly medium or high competition. Now you might not make a lot of money selling a chess board but most people weren’t searching to buy anyways, they are searching for tips and tricks.

Perspective with the Keywords

The keyword planner has always been a hangup for me because I didn’t feel like I knew the metrics enough to understand what the numbers were telling me. Well, a chat session with Brother Poole helped me realize, its pretty simple, you just have to give the numbers some perspective. He shared the following analogy with me after I asked him, “is that a lot of searches”:

Is a plane flying 64 miles per hour going fast? Well, if it is a plastic, radio controlled toy plane that is only 3’ across, then yes, its is zipping through the air. But if a fighter jet is going 64 miles per hour, it probably won’t even be able to get off the ground.

No one is buying ukuleles in Rexburg, but people are searching for them in Hawaii.

Keep in mind traditional marketing ideas. How many people are looking for it, how many people do I need to have buy it? What percentage of that. 100% arent going to buy. I don’t know a good conversion rate yet but I’m guessing its in the single digits as you will only get a portion of people to click, and then only a fragment of those people will buy.

Enrolling in B250 - Web Business

Before getting into the meat and potatoes of the course, I just wanted to remind myself how, when, why, I signed up for it in the first place.

A few weeks ago, I talked with Jeremy over the phone and he mentioned he was getting an endorsement to go back to school. I thought this was pretty ridiculous but after discussing his plans to take some more finance classes and work towards that degree, I was interested but then forgot about it.

New Years rolled around and I stuck with the same goal to swim a mile that I have had written on my wall for a few years. Actually, I didn’t even commit to that one. I was feeling pretty lame. Our recent trip to Oregon had me wanting to travel more, or just pick up and move to Oregon for a change. Then I started to think about my goals when I left college, I wanted to start an online business and create an income that would allow my to travel, ie, not be tied down to one particular desk. So I set a goal. One goal. Start an online business. Not necessarily a successful one. Not the one and only. But one to get my juices flowing and to be an educational endeavor where I could learn the nuts and bolts of it. I committed to myself that if I didn’t have a site up with products ready to sell in two weeks, I was just going to move to Oregon anyways, find a job there and start over.

After researching drop shippers and realizing I needed some help to guide through the mess, I started looking for some courses online that might help. Then the conversation I had with Jeremy popped back into my head. I immediately jumped online, and found the course. Mind you, this idea popped into my head at some point in the afternoon (20140107 Tuesday). By that night, I had reapplied for school, got my endorsement interview with Bishop and also my interview with President Anderson from the Stake Presidency. It helped that I was at the church with Bishop for his other interviews that night and one of them happened to not show up. It also helps that President Anderson lives next door.

All in all, I’m confident that I am supposed to be in this class at this time. Well, maybe not at this time. I think I probably was supposed to take it a few years ago, maybe 5? But I guess the Lord just waited for me to pay attention and finally go for it.