Online Marketing:  What To Sell

Ok, you have decided that online marketing is for you.  You are ready to get your feet wet and place some PPC Advertising.  Now what?   You will need a product or service to sell ( I suggest reading the Cause and Effect article at this point if you haven't already).   You will need a web site and a good domain name.  Then you will be ready to test the advertising (see Internet Marketing Basics for more info on testing).

Typically I have found services easier to sell than physical products online.  You have to think in terms of what people want.  When they can easily compare things online such as financial terms or interest rates and choose the most competitive, they are willing to make the transaction online.  When they are given a choice between calling a broker and paying $40+ to sell a stock vs. $9.95 or less online, they will choose the online option.  When they see an intriguing informational product that can be downloaded instantly and used, they will impulse buy to get it right away.  When people want to gamble without traveling to a casino, they sit down at their computer!  Just think about what you do online and your online spending habits.

First of all, non-travel related online spending grew approximately 24% from 2004 to 2005 according to ComScore Networks.  Travel related purchases were up about 20%.

Here are some of the product areas that delivered the fastest growth according to their report:

If you are going to sell products online, you will want to target the fastest growing categories, because this is an area where consumer adoption is fastest.   Books and CD's are growing more slowly because Amazon has already developed a significant market share in those sectors.  I'm surprised not to see consumer electronics considering how many ipods were sold online, but again the online consumer electronics market is probably too large to grow over 20% per year.

Services and Information:

In my experience, I have had limited success selling products online and have found it much easier to sell services or specialized information.  The growth in these areas is more difficult to quantify because there are so many smaller players, but I believe it is growing very vibrantly based on what I see going on out there.  If you have specialized knowledge or expertise, you should really consider putting together an ebook or informational course.   Real Estate courses, Investment courses and Online Business Building courses have been a few of the areas that have flourished online.

Services such as video streaming will also become much more widely used in the next few years, so I expect those areas to be very profitable.  Since I have several years of audio / video experience under my belt, I will be offering courses in those areas. 

Another way to spot opportunity is to look at the most expensive keywords in google.  The price per click someone is willing to pay will change from day to day, but ones that are high will tend to stay high because they have high economic value.  You will see that many of these are financial services related terms, this will be reaffirmed in the next section.

Premium Search Terms On Google

If you open an account with Commission Junction, you can go into all the available merchant offers and it will tell you which merchants are the most profitable to send your traffic.   You will again see that many of the top paying programs are from Financial Firms, which re-affirms why those keywords have the highest bids.

Here is an example that uses pay per lead:

LowerMyBills.com -   3 Month EPC = $241.42   7 Day EPC = $231.44
Pays $8.00 - $32.00 per lead based on type of lead.

Now what this means is over the past 3 months, affiliates have been paid an average of $241.42 for every 100 people who clicked on a LowerMyBills ad.  The 7 Day EPC is nearly the same number so it seems to be a very consistent payer.

LowerMyBills.com pays you when someone fills out an application ( pay per lead ), not based on the actual approval of the transaction.

Here is an example that uses commission per sale:

Citibank Student Credit Cards -   3 Month EPC = $171.44   7 Day EPC = $37.65
Pays $42.00 per sale when the credit card is actually issued.

In this case, the merchant only pays you when a card is actually issued so it's a per sale transaction.  There is currently a big spread between the 3 month epc and the 7 day, but this is sometimes just because of the timing of the deposits.  Most merchants pay out once per week or something of that nature.

Here is an example of an actual product sale:

Carrot Ink- 3 Month EPC = $120.21    7 Day EPC = $128.10
They pay 2-27% on product sales.

My application was immediately denied because I just setup a new Commission Junction account and they only accept proven affiliates.  Oh well, I wasn't planning on selling refilled ink jet cartridges anyway!

When you find a merchant that you are interested in becoming an affiliate for you simply click the application button.  Most of the higher paying merchants have a manual approval process where they will view your site and determine whether or not you are a match for them. 

Spotting Hot Technologies

Just by looking through magazines and watching tv commercials you will spot good opportunities.  In 2001 I noticed that Dish Network was becoming very aggressive with their marketing, so I contacted them and got setup as an online dealer.  But you don't really even need to become a dealer, because many of the existing dealers such as Allsat that pay high commissions.  In fact, Allsat now uses a "Build Your Own Dish" model that I originated on my DishFinder site back in late 2001.  It has become the industry standard for selling online.  I still have a Satellite TV Blog that I occassionally update and make a few sales from.

iRobot is an interesting company, that has introduced two new products to the consumer market in the past few years.  The first new line of robotic vacuum cleaners call Roomba and now a line of robotic floor washers called Scooba.   Products like these make interesting affiliate opportunities to add to your website because they create interest among your visitors that are unfamiliar with them.