Hello and welcome to Social Media Traffic School with Sally Hendrick.

That’s me! I’m Sally from Nashville, Tennessee, and this is today’s update.

Today we’re talking about how much traffic you need on your website to make a sale, and how much that costs in advertising.

Obviously, this changes for every advertiser, as no two businesses or sales funnels are exactly alike. First you want to know how much you’re spending per thousand impressions. That’s CPM in your reporting tool. If your ads are costing $10 CPM, that means it costs $10 to create 1,000 impressions of your ads.

Let’s say that those 1,000 impressions are generating 10 leads. That would mean that you’re spending $10 to get 10 leads, which is $1 per lead.

If you’re paying $1 per lead, and your ads budget is $1,000, then you’re generating 1,000 leads.

But what about sales?

As these 1,000 leads travel through your funnel, some people will start to drop off and not click any further on your webpages or open your emails, but many of those people will keep going and keep paying attention.

So you make an offer to these leads. Only a few people will actually click through to look at your sales page, and a few of those may purchase your offer. Let’s say that 50% or 500 actually see your sales page, and then let’s assume that 2% of those people will buy your offer. That would be 10 sales.

At this point, if you want to be profitable, the price of your offer must be more than $100 in order to make money. Let’s just say your offer costs $200. So $200 x 10 = $2,000. You spent $1,000 in ads, so your profit is $1,000. Not bad! You doubled your ad spend.

If you’re running your ads yourself, you’ve made a profit, but if someone else is running the ads for you, you could be losing money unless you decide to risk more advertising spend, assuming that you’ll make double what you put into the ads.

Let’s review:

Understand your CPM costs.

Find out how many leads you’re generating and the cost per lead.

Pay attention to how many of your leads actually visit your sales page.

Then know how many sales you make.

Compare your sales to your ad spend, and remove any expenses along the way.

If you’d like to understand your numbers, this is what we teach in our coaching program, among other things that you can do to optimize your websites and drive traffic to them to get paying customers. Visit us at socialmediatrafficschool.com to get started.

See you next time!

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Social Media Traffic SchoolBy Sally HendrickSep 23, 2019