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Old 07-15-2015, 10:14 AM   #1
Crak_Eric
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GFY Educational Series: All About Media Buying, Part 3 - Profit Calculation





After reviewing the basics of media buying over the last few weeks, the fun part finally begins! Profit calculation!

Before sending any traffic to an offer, the very least a smart and savvy media buyer can do is choose the plan that will likely generate the most gains.

However, like all business models based on human behavior, media buying is not an exact science!

Rule No. 1: Never lose money.
Rule No. 2: Never forget Rule No. 1.
― Warren Buffett



Put theory into practice


For example, let’s say that you bought a RON that brings you 4,000,000 impressions for 3 days of traffic. Now that those 3 days have passed, to continue making money now, you need to recognize which offer performed the best for your traffic, and which one turned out to be the most profitable.

In this fictional situation (and to make sure that you’ll get it), we’re gonna say that all costs are based on a Cost Per Thousand (CPM) model.

Remember, the CPM is the price that you are paying for every 1000 views of your ad.

This kind of price is usually determined by bid price: You get a higher volume of traffic only if you bid higher than your competitors. It’s a dog-eat-dog world! Everyone wants the best spots and best deals, so if you want a certain spot, step up to the plate and get it!

By this point, you’ve also successfully AB-Tested Your Traffic on different products and you’ve earned some money now, because well, you’ve been following our advice!


eCPM – Earning per thousand impressions
Now you can calculate the eCPM, which you’ll recall, is your earnings per thousand impressions. In this example below, you’ve earned:
  • 20 cents per 1000 views with your Cam offer;
  • 10 cents per 1000 views with your Dating offer;
  • 5 cents per 1000 views with your Casino offer;
  • and, 15 cents per 1000 views with your Paysite offer.
We’ve also defined the eCPM in our last post but here’s another way to calculate it :
  1. First, you need to divide your number of impressions by 1,000
  2. Then, you divide your earnings by the number you’ve got in the previous step.
  3. Take the next campaign, Lather. Rinse. Repeat
For example, in the case of your Casino offer :

You divide 1,000,000 by 1,000 which gives you 1,000 (Sounds redundant, huh?).
Then, you divide your gain of 50$ by 1,000.
That’s how you find out that you’ve earned A HUGE 5 cents per 1 000 views.

Even if this calculation looks reaaaally easy in this example, it can sometimes be trickier than it looks because there’s never a guarantee you’ll get round numbers in real life!



CPM – Cost per thousand impressions
Now it’s time to find out if these offers were profitable and we’re only going to be able to do so with the CPM – the cost you’ve paid per thousand impressions. In this case, let’s say that, in order to purchase the RON, you’ve bid a CPM price of 0.12$ — this means that you’ve paid 120$ for traffic towards each of your offers:

1 000 – the number you’ve reached in the first step calculating the eCPM – multiplied by 0.12 = a cost of 120$ for 1 000 000 impressions

You can easily calculate your gains or losses from there…



OK, while you may not be a billionaire just yet, look on the bright side… this whole media buying thing has netted you 20 bucks!

The key thing here is that you’ve profited and you’re now in the green. A profit is a profit, no matter the number. Always keep that in mind.

It’s not where you start – it’s where you finish that counts.
–Zig Ziglar


Knowledge is worth its weight in gold now that you know which offers are profitable and which ones are not. The next step is to send your traffic to the most profitable offers which, in the example above, are the Cam and Paysite offers.

Be careful though! You might be tempted to send all your traffic to the most profitable offer (in this case it’s the Cam offer). It’s important to remember to never put all your eggs (or in this case, traffic) in one basket. Strike that balance we’ve Talked About Before and consider sending 5, 10, or even 15% of your traffic to other offers that may turn out to be the most lucrative, later on!

Cheat sheet to success

You’re going to become successful at media buying by testing alternatives, always.

You never know what’s good and what’s not until you have the numbers to verify it. Hunches and feelings will only get you so far. ALWAYS calculate!

A data-driven approach is the foundation to media buying.

To make money, you’re going to lose money at times. You can’t win them all.There’s always going to be unprofitable campaigns, but the important takeaway here is to be smart and methodical enough to globally win – and win in the end.

Apply these practical guidelines to media buying, and you can bet your butt you’ll be flying high with profit and soaring to new heights...

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Old 07-15-2015, 10:32 AM   #2
C H R I S
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Another informative post from Crak. Media Buying is an science and an art, with a little practice webmasters can master.

Anyone looking to start campaigns with QUALITY premium traffic - get in touch with me.
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SKYPE : chrisandbee69 | EMAIL: cl at etology dot com

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Old 07-15-2015, 10:49 AM   #3
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Nice informative read !
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I buy my traffic from


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Old 07-15-2015, 11:03 AM   #4
The Porn Nerd
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Is this mostly targeted towards cams and dating offers? Or can this info be used effectively for paysite media buys?
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Old 07-15-2015, 11:05 AM   #5
xXXtesy10
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not reading all of that
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Old 07-16-2015, 10:18 AM   #6
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Originally Posted by C H R I S View Post
Another informative post from Crak. Media Buying is an science and an art, with a little practice webmasters can master.
Quote:
Originally Posted by PornoPlopedia View Post
Nice informative read !
Appreciate it, guys!

Quote:
Originally Posted by The Porn Nerd View Post
Is this mostly targeted towards cams and dating offers? Or can this info be used effectively for paysite media buys?
That's the beauty of Media Buys, most of what was covered here, including profit calculation, applies to all aspects of Media Buying/IM. Paysites included
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Old 07-16-2015, 11:10 AM   #7
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Thank you kind sir for Part 3 of this Educational Series!
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Old 07-16-2015, 06:56 PM   #8
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Good read
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Old 07-19-2015, 10:39 PM   #9
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Thank you for sharing this! It really helps to have someone share such insights especially for those who are new to the industry.
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Old 07-20-2015, 01:58 PM   #10
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150.00 with 1,000,000 ad impressions? this sound most legit ever heard in history of gfy. where can we get on knees and suck off for such true info?
so funny so many webmaster walking around hands out like soup kitchen these days. buy into anything for a small piece of used horse meat.
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Old 07-20-2015, 06:55 PM   #11
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The giant first step and key to media buying as with any paid traffic...

CREATIVES.

If any burgeoning companies need help sifting out a productive campaign and are tired of weak margins shoot me an email and we will take care of your needs comprehensively.

Don't partition your time crunching numbers, let us show you the way

/shameless yet honest plug
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Old 07-21-2015, 01:52 AM   #12
Crak_Eric
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Quote:
Originally Posted by Maurelle Marquez View Post
Thank you for sharing this! It really helps to have someone share such insights especially for those who are new to the industry.
It's our pleasure! Thanks to you all for reading.

Quote:
Originally Posted by myjah View Post
Thank you kind sir for Part 3 of this Educational Series!
no, THANK YOU kind ma'am for the pin!
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Old 01-05-2016, 10:48 AM   #13
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Cool overview for newbies, Eric.
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I have been using them for over ten years now for my adult sites and I am very happy with their services.
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Old 02-23-2016, 01:05 PM   #14
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Thanks guys your' posts help a lot
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