By Paul Parcellin, Staff Writer
April 29, 2014

A lead generator must come up with a steady flow of leads, but acquiring those leads can be costly. One strategy to reduce the cost is to work with second-tier ad networks. If managed properly, second-tier ad campaigns can help you tap into a pool of good-quality traffic at a lower cost than you'd pay a first-tier network.

If you're part of a lead generation company and have worked with an adverting network, you already know the basics of how they operate: the ad network is a firm that connects websites that host advertisements with businesses that want to advertise. Visitors to the websites that host your ads may see your advertisement and click on it. Usually, visitors who click on your ad are brought to your landing page and, if all goes well, they convert.

Ad networks are classified in two groups, first-tier and second-tier. First-tier networks have a large number of their own publishers and advertisers. They get high-quality traffic and they serve ads and traffic to second-tier networks. The major search engines are examples of first-tier agencies that a lead generation company can use.

Second-tier agencies may have their own advertisers and publishers, but they get most of their revenue from syndicating ads from other advertising networks. Online advertising inventory comes in many different forms. This inventory can be found on websites, in RSS feeds, on blogs, in instant messaging applications, in adware, in e-mails, and on other sources. Some examples of advertising inventory that a lead generation company uses include: banner ads, rich media, text links, and e-mails.

Some advertisers find that second-tier networks' offerings are a better fit for their ad budget than are first-tier networks such as Google, Bing and the others. The first-tier agencies can cost anywhere from $30 to $50 per click, but second-tier agencies can provide a lot of traffic at a lower cost. Second-tier traffic quality may not be as high as that from Google or Bing, but the larger quantity at a lower cost could work well with your cost per acquisition in the long run.

Marketing Tactics

You'll find that many of the management tactics you'd use on Google and Bing paid searches will transfer well to second-tier networks, but the networks are also different in some ways and will require that you treat them differently. Your keyword research and ad text will likely work with your second-tier campaign, but there are slight differences that a lead generator has to negotiate.

 

After Hours

On second-tier networks, lots of advertisers put a cap on their daily budgets, and they usually max out at around 5 p.m. After that hour, the crowd thins out, competition decreases, and a lead generator can get in with bids that are even lower than the regular ones. That way, you can get a lot of traffic on the cheap.

Weekends tend to be a downtime for lots of advertisers, and that offers you the chance to get traffic with a bid reduced by as much as 25%. Work with the networks and your AMs to learn when traffic tends to peak and to ebb. If you're working with an email-based network you can optimize your bidding strategy by knowing when the mass mailings go out.

Testing

Traffic quality will vary among networks, so it's advisable to test several different networks to find the right mix of traffic at a price that works with your budget. It doesn't cost a lot to set up an account with many second-tier agencies, so it makes sense for a lead generator to continually test the waters with small investments in new ad networks to see what kind of traffic they can bring.

Financial Leads

"The Clicks.net network focuses only on financial traffic but can be a great source of cheap traffic if you happen to be a lead generation company involved in mortgage, debt consolidation, 401K or auto/home/business loan lead generation," says Justin Freid, writing for Search Engine Watch. "Targeting capabilities are limiting and the interface lacks thorough reporting but the traffic through this network has some decent quality to it."

Freid says average bids range from $2-$5 depending on the industry you are in, but he adds that a lead generation company will find that a cheaper remnant inventory can be had for under $1 during evenings and weekends.

Taking Care of Business

Say you are a key player in a lead generation company are solely in charge of setting up accounts across second-tier networks it may be a good idea to work with networks that offer account manager support. You may find that some account managers understand the kinds of publishers you need to be pared with and can help you get great traffic at a low cost.

You may not have to budget to get an account manager, so it's a good idea to use the strategy that is effective on other high performing traffic sources, such as head keywords and high performing ad text from Google. Over time, you'll figure out what is the best mix of traffic.

Minding the Store

It's always a good idea for a lead generator to keep a close watch on his or her return on investment. In fact, it's something you should be watching on a daily basis. Networks will change publishers from time to time, and your traffic may also change accordingly. If you keep a close eye on your ROI, you can tweak your traffic mix on an as-needed basis to ensure that you're getting the best traffic possible.

Credits and Refunds

Generating leads requires a firm understanding of the kind of traffic that you need. You will probably have days when traffic varies, and sometimes you'll get a day when low-quality traffic has a big uptick. Traffic quality is the networks' gold standard - their reputations rest on providing high-quality traffic to advertisers. They frequently add new traffic sources, and some may not work out for you. You can always ask for a refund or a credit if you find that you've hit a patch of low-quality traffic days.

Managing Expectations

While it's important to understand that second-tier agencies will not give you the same results that you'd see from Google, Bing and Yahoo!, a lead generator can still get a lot out of the second-tier with proper management.

However, the top three search engines command 75% or more of the market, so it's realistic to assume that your results will be proportionately smaller than what you'd get from the top tier. The important factor is your CPA, and ifyour ad campaign is managed properly, you can enjoy the benefits. Justin Freid estimates that the average CPA from second tier ad networks was between 15-19 % lower than that from first-tier networks. 

Post Script

As a lead generator, you'll want to be sure your advertising dollars are bringing in the traffic that you want at a price that you can afford. One way to get cost-effective traffic is by working with second-tier ad networks. With testing and careful management, second-tier networks can generate the traffic that you are looking for. If handled properly, you'll get high-quality traffic at a lower cost than you'd pay a first-tier network.

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