There are many ways to measure your native advertising efforts. At VigLink we tend to focus on earnings per click (EPC). EPC represents a per-click measure of how efficiently your traffic is earning from advertisers. For a given volume of clicks, the higher your EPC, the higher your revenue. It’s imperative for publishers to understand how EPC functions in order to maximize their earnings; this means finding out where people are earning the most, in what industries, and on which devices. We analyzed 100 million clicks and four million dollars in revenue to bring you a detailed breakdown of where the money is.
Calculating EPC is as simple as dividing total commission by total clicks. By doing so, you’re able to determine the potential worth of clicks on your site. But EPC is actually driven by a variety of other variables. The publisher must also consider (a) price of the item recommended (b) average commission rate of the merchant (c) average likely conversion rate of the shopper. EPC is the product of those variable. If one of every hundred clicks from your site turn into a purchase for a $100 gadget, for which you are paid 5%, then your EPC would be (0.01 * (100*0.05)) = $0.05 per click. Keep the click number constant but sell goods worth $200, and your EPC will double. Keep clicks and item price constant but double the commerce intent of your traffic by really encouraging them to buy, and the increased conversion rate will mean higher EPC for you.
One way to consider EPC is by industry. Our data suggest the top three are financial services ($1.80), motorcycles & power-sports ($1.50), and lifestyle ($1.37). On the contrary, the three lowest are art & entertainment ($.06), travel ($.19), and family & baby ($.27). The purchase price of items in the first three industries tend to be significantly higher in cost than the later three, they also warrant recurring customers which merchants value and are willing to pay higher prices for.This explains their high EPCs.
With increasing resources and time devoted to tracking consumer trends over mobile and desktop devices, publishers are focusing more on where they are getting their traffic. Mobile is quickly emerging and will be more influential than desktop traffic in the near future, but it isn’t there yet. Even if publishers have equal amounts of mobile and desktop traffic, that doesn’t mean the conversion rate on mobile clicks is as high.
We learned desktop EPC was the highest at $0.07. Not surprisingly, tablet EPC was not far behind desktop at $0.06, but mobile remained low at only $0.02. Showing that even as mobile traffic to sites is increasing, people are still far less likely to purchase on those devices. The poor user experience on mobile risks deterring even the most avid shoppers. When considering the sports and fitness industry this trend mapped out exactly following the trend with desktop EPC at $0.18, tablet EPC at $0.13, and mobile EPC at $0.10. Device EPC will be the number to watch as apps and mobile websites continue to increase their accessibility to customers. With the combination of these more efficient sites and the upcoming generation being more comfortable on their mobile devices than desktops, mobile EPCs will undoubtedly continue to rise, but for now… don’t neglect your desktop experience.
Written by Hanna Fritzinger