In the previous two articles we looked at managing legal risk and also the different types of traffic that often flow through to domains. In this article I will be examining the other influencers on the returns from a traffic portfolio.
The first thing to look at is where the traffic is coming from. For example, is it mainly USA or is it from China? Chinese traffic tends to be paid much less than traffic from the USA.
A number of years ago I did an analysis on the penetration of credit cards in a specific geographic region and how this influenced earnings per click (EPC). Cash based economies like China tended to have a much lower EPC. The reason being that marketers have a much more difficult time tracking spending money online to ultimate sale of the goods if the transaction is constantly being pulled off-line.
I personally believe that over the years ahead many of these burgeoning economies will adopt credit cards and the online cycle will be complete for marketers. So watch this space!
When you buy a traffic portfolio you are always looking for any “free” upside. An example of this would be if you were getting paid 90% from a monetisation provider but the person selling the portfolio is only getting paid 80%.
We’ve had ParkLogic clients purchase portfolios that have been held at a single parking company and then placed on our system. From experience, typically no parking providers wins more than 20% of the traffic on our platform which means that the acquisition would receive more revenue 80% of the time if move to other platforms. This typically provides a 30% uplift in revenue via our algorithms and processes and this dramatically reduces the payback period for the investment.