When to Cut Campaigns? (4)
At what point do you decide to cut a campaign? After how many clicks and no conversions or any other specific data amount, do you say enough is enough and you cut the campaign?
You would probably receive 10 different theories in the first 10 replies.
Everybody has their own strategy, mine boils down to an instinctive combination of:
1) How much potential I see in the offer/campaign based on what other affiliates are doing.
2) How much of a swing would be required to get the campaign profitable based on current stats? Is that likely?
3) Can I test a different offer/angle?
4) Even if I got this campaign profitable, would it deliver enough volume to pay for the time I'm spending on it?
5) Gut instinct.
Originally Posted by talontron
This is a simple math exercise.
- Based upon the payout and your traffic costs, this can be 1.5%, 15%, or 150%.
- Even before running any campaign, it should be clear that if you need 150% conversion rate for the campaign to back out, you should cut it immediately.
Step Two: Figure out how large of a sample size you need in order to be confident that you either can or cannot hit the required CVR
In stats terms, you need to define your null hypothesis, and determine the confidence interval required to reject the null hypothesis. Important note: the required sample size is DEPENDENT on the conversion rate you require in order for the campaign to back out.
This is why asking "how large of a test do I need" (as I see many people on this board to) is, in itself, completely meaningless. The reason is obvious:
- Suppose (just by way of example) you need a 75% CVR for a specific campaign to back out. Even if you run just 25 clicks to your page and NONE of them convert, then you can be quite confident that your should cut this. Why? Because in order for this campaign to back out, you will need EVERY SINGLE ONE of the next 75 clicks to convert. What is the probability that this will happen, given than none of the first 25 converted? Just intuitively, it should be clear that this will be VERY LOW.
- If on the other hand, you only need 1% CVR for your campaign to back out ... then even if you have 25 clicks with no conversion, it is difficult to feel confident that you should cut this. Why? Because in order for this campaign to back out, you only need 1 out of the next 75 clicks to convert. Intuitively speaking, it should be clear that the probability of that happening will be higher than the first example.
Step Three: After you have run the zero conversion campaigns at a sample size large enough for your required level of confidence, cut the campaign ... but don't stop there.
Okay so, after doing steps 1 and 2, you realise that this campaign most likely will not back out, then yes you should cut it.
But cutting it does not mean giving up.
Cutting a campaign means trying to figure out why that campaign may not have worked, and if possible, trying to create another campaign (and indeed multiple campaigns) that can build upon this thinking.
Figuring out why a campaign may not have worked also does not mean just changing the landing page.
Once again, you need to think through all the variables that drive campaign profitability ... including the payout of the offer and your traffic sources. The payout of the offer, for example, impacts your gross profit (GP) which has pretty much a direct inverse relationship with your required CVR. So your gross profit (GP) doubles, your required CVR goes down by 50%.
As you can imagine, doing this a scale, for hundreds if not thousands or tens of thousands of campaigns is not easy. But if it is hard for you, it is hard for everybody else.
And doing something that is hard that other people are not willing to do, is a great source of competitive advantage.
You should definitely read this http://www.charlesngo.com/losing-mon...g-or-to-pivot/
There are a LOT of ways to optimize a campaign
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