David Fiske Affiliate marketing & web development musings from Fiske Towers

"OK, so you've told us how much money we need to earn each day to create a reasonable living but how easy is it to generate (for example) £100 per day?"

I suppose that would have made for a better post but nonetheless, I'll clear that up now.

What are the calculations for working out how many visitors you need?
 
Our target per day is £100. To make that, we need visitors and we need orders.

To create a calculations, we need an average basket and an commission rate.

So, for Dilbert books, lets assume a basket of £15 and a commission rate of 5%.

For one average sale, we can expect (£15 x 5%) £0.75.

To get £100, we need (£100 divided by £0.75) 134 orders.

Now, whenever I calculate stuff like this, I assume that 1% of my visitors will make a purchase. This is obviously dependant upon what it is that you are selling and what the average basket size is. You are likely to sell more books than wide-screen TV's but you could profit more long term from TV's.

So, if 1% of visitors create 134 orders, we need (134 x 100) 13,400 targeted visitors per day.

To show a contrast, let's take jewellery with 10% commission and a £50 average basket.

For one sale we can expect £5.

To get £100, we need 20 orders.

Therefore, we need 2,000 unique targeted visitors per day.

One last one for fun! This time, we will use a fixed commission rate and we will select loans as our subject.

For each loan application with XYZ, we get £100 commission.

Therefore, we need one application per day to get the £100, equating to 100 unique visitors.

The point that needs to be highlighted here is that you then have to look at the bigger picture. Yes, you need substantially less visitors for loans but the market is incredibly saturated. The market for jewellery can be niche depending upon which section you tackle. The books idea is certainly niche but you then have to questions how easy is it to get 13,400 unique Dilbert fans to your site every day!

Hope this helps.