Expensive Product/Small Commission...?
Submitted by TranceMaker on Sat, 05/10/2008 - 22:18.
I am currently searching for a good product to use for this project. And, I am wondering...
If one picks an expensive product ($250+, jewelry, technology, etc.) from, let's say Commission Junction and it just has a 5% commission -- which isn't so atypical -- is it really worth getting just $12.50 per sale...
... as opposed to a "subscription" that pulls in $30/month?
On the other hand --
I am looking at an item that I found that just sells for $90 with a 15% commission. That's only $13.50. However, I can sell them another product with a $100 commission on the back-end.
So, I am a bit confused. What should I really focus on after I know my niche, product/commission-wise?
Bryan
There are no hard and fast
There are no hard and fast rules. One thing I will advise is that you focus less on the numbers and more on the opportunity. For example, which niche can you build a better site for? Does one have more/less competition? Do you know more/less about one of these niches?
Commission is always a consideration, but there are guys who can make six figures a year on $5/commissions or $500/commissions. There are too many factors at play to give you a good answer.
Okay, Then I Know...
Then I know where to begin. :-)
I'll start with the small product, making just a few bucks... back-ending to a more-expensive product later on. These are products that I have personally used (both for myself & professionally!) so I think I'll have the upper hand with this.
Thanks, Jeremy...
Bryan
Also Bryan, when you convert
Also Bryan, when you convert someone you typically can catch their email address to market to them later. I sold simple wood pens in a particular deal a year ago and captured 700+ emails. A few months afterward when the end of year holidays started approaching I emailed them all a link to some new pages where I could re-market more expensive handmade wood pens.
I made a few dozen sales with very little effort and now have an estore with a blog that collects sales and rss/email subscribers where I can tap into occationally with "special deals."
-Ken
got twitter?
www.twitter.com/kensavage
Go small or Big
The question I've often asked myself is whether it's easier to sell a million items at $1 or one item for $1 million dollars. Certainly the payoff for selling the million dollor item would be worth it but I think that for some items the effort in the long run can almost be the same. I personally think that it's easier to sell the $1 dollar item and go for the volume approach.
Perhaps Jeremy can chime in on this, is the conversion rate on lower priced items generally better than high priced items or does it depend on the traffic quality that you are getting to your site?
Chris
Think Wal-Mart
"The question I've often asked myself is whether it's easier to sell a million items at $1 or one item for $1 million dollars. "
I'd say the million items at $1. It certainly worked for Wal-Mart. It's better to keep the cash flowing than to have it tied up for a long time trying to sell one expensive item.
An affiliate friend of mine makes $1 per sale selling something that's free. All the visitor has to do is give his or her email address. That doesn't sound like a lot of money but with the amount of traffic he gets, he makes quite a lot from it.