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Tiers of Traffic in Affiliate Marketing: why geo-targeting matters?

Discussion in 'General Affiliate Marketing Forum' started by zeropark, Jul 8, 2020.

  1. zeropark

    zeropark Traffic Manager Traffic Manager affiliate

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    What are country tiers in affiliate marketing?
    Affiliate marketing allows advertisers to target ads at people all over the world. To make your life easier, all these countries have been divided into three groups — tiers — based on a number of factors, like:
    • financial status
    • geographical location
    • languages
    • legal regulations
    • technological advancements
    • society and ethnicity
    This allowed for identifying three main areas that share similar characteristics, called TIER 1, TIER2, and TIER3 GEOs.

    So what countries belong to each group? Well...if we were to include them all you’d get tired scrolling down. That’s why you can check the full list here or have a look at our blog article for the shortened version that we’ve prepared for you.

    Here are a few brief observations, though:
    • Clearly, Tier 1 includes mostly English speaking countries plus rich Western European ones.
    • Tier 2, as could be expected, is a mix of countries from all over the world that could be described as medium level.
    • The last group, Tier 3, consists of all the other countries — either the poorest, the least developed, or simply the least attractive for affiliate advertising. Do not write it off just yet, though. Bear with us and you’ll see there’s a huge potential in Tier 3 countries.

    [​IMG]

    Why is geo-targeting essential for digital advertising?
    Geo-targeting is a very important part of any digital advertising strategy because careful targeting and optimization are crucial to the success of your campaigns. That’s why geo-targeting is a key component of your marketing strategy.

    It allows you to analyze the audience’s preferences and can get you real far in affiliate marketing. The more you learn about your ads’ recipients, the higher your conversion count.

    Where to invest your advertising budget?
    Once we’ve established the basis as to why geo-targeting is an essential part of your business, let’s have a look at each tier and discuss its characteristics, pros and cons, as well as what areas are especially worth focusing on.

    [​IMG]
    US, UK, AU, CA joined by FR, DE and IT. What a party, huh?

    As mentioned already, Tier 1 consists of the English speaking countries plus the three Western European ones. These are definitely rich countries, with a huge spending potential, high technological advancement, and broad mobile devices adoption. All this makes them a very attractive target for affiliate advertisers.

    [​IMG]

    The second group is a mixture of the remaining European countries, Asian countries, and the better-developed countries from the African continent. Generally, people there aren’t as prosperous as in Tier 1. Although this may be a sign of a smaller spending potential, it varies heavily depending on a country. That’s why advertisers need to check how a particular country they’d like to target performs despite its Tier characteristics.

    [​IMG]

    For some advertisers, the Tier 3 countries are the wild, wild west of affiliate marketing. There are little rules, lot’s of traffic for very occasional prices, many campaigns that wouldn’t even be accepted in other GEOs are scoring it big in Tier 3, and the competition is much smaller.

    There’s a huge potential in Tier 3 GEOs that’s only waiting for takers. The technology has moved forward significantly in the last few years, and mobile adoption, as well as the online payment solutions, are only growing. This means more and more offers actually make sense to be run with Tier 3 countries.


    Top GEOs & Cost-Per-Click
    The higher the tier, the higher the prices — that’s something we’ve already established. Now, to help you understand why it’s better to go for Tier 3 regions if you’re only starting, here’s some food for thought.

    Some Tier 3 countries, like the Philippines, offer lower CPC prices, smaller competition, big volumes, eager audiences, and still use English as their conversational language, so you don’t even need to worry about translation. What’s not to like compared to the crowded, expensive and highly demanding US market? Let’s do some basic math.

    • If you want to run push ads in the US, your CPC is $0.04.
    • While in PH it’s only $0.0072.

    That’s 550% higher price per click for a Tier 1 country as compared to Tier 3!

    It means that in order to buy 1000 clicks and test your campaign’s set up, you’d need to spend $40 for the US targeting, and only $7,2 on your PH campaign. Having a $100 testing budget allows you to gather way more data running tests on PH traffic rather than US.

    [​IMG]

    [​IMG]

    [​IMG]

    English-speaking yet cheap GEOs outside of Tier 1
    Another thing is that, many of the countries outside of Tier 1 do actually use English. Often as an official language, or simply because the language adoption is high among its citizens.

    That’s why we’ve prepared a list (that we’ve already shared with you on our blog) with countries where English is commonly used as the set device language, therefore making it the preferred website (ad) viewing language should work, too.

    Geo-targeting and optimization tips for successful campaigns.
    Advertisers need to be careful when choosing what tiers and countries to target, and that’s for a number of reasons. It’s not only about which region is the most profitable, or what’s better for more or less advanced affiliates.

    If you want to learn more about things we briefly explained in this forum post, just head to our blog article!

    [​IMG]
    >>>> CLICK HERE <<<<
    Read and learn all you need to know about different tiers of traffic in affiliate marketing, and why geo-targeting matters! Enjoy scaling your business.

    Magda​
     
    Darja, Abril, tyoussef and 3 others like this.
  2. AdCombo
  3. Certified
    T J Tutor

    T J Tutor GM Administrator Certified Vendor Dojo Master affiliate

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    This is incredibly important and well put!

    NOOBS! Pay attention to this, take some notes!
     
    tyoussef and aleksifa like this.
  4. aleksifa

    aleksifa Affiliate affiliate

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    Thanks zeropark for this awesome information along with the pricing tables!

    T J Tutor DULY noted! :D
     
    tyoussef and T J Tutor like this.
  5. hacxx

    hacxx Affiliate affiliate

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    Great article. Thanks.
     
    T J Tutor likes this.
  6. mortensic

    mortensic Affiliate affiliate

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    Great article and well put. I'm curious; how come you don't see Scandinavia (Denmark, Sweden, Norway, Finland) as Tier 1? I'd say we fit all the criteria for being a Tier 1 country :)
     
    Juliette.D, Graybeard and T J Tutor like this.
  7. zeropark

    zeropark Traffic Manager Traffic Manager affiliate

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    Tiers are determined based on a lot of things but mainly on how much advertizers are willing to pay for these GEOs. Even though the countries are rich economically, the click prices never go as high as the countries that belong to Tier 1 already.

    Traffic networks don't determine the Tiers - it's advertisers and how much they're bidding in each country. We only grouped the countries together based on their cost similarities.

    Magda
     
    mortensic and T J Tutor like this.
  8. Certified
    tyoussef

    tyoussef Moderator moderator Certified Vendor Service Manager affiliate

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    @zeropark this is a very important topic.
    very well detailed.

    thanks @zeropark for sharing.
     
  9. Graybeard

    Graybeard Well-Known Member affiliate

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    Sorry, that will not work in the US that well
    upload_2020-8-5_16-11-32.png

    *that's not including very low income people that do not bother filing taxes ie children-dependents ... so the lower group may be in fact a larger percentage.
    Super poor and super rich ... who do you want to reach and how much ad money do you want to waste?
    The top richest 6% will not be interested is most offers people use here but they might be interested in Porsche hood bras or some other luxury item. In another spectrum you might want to target slightly below average income earners with some other offer they might have interest in.

    1. I am assuming human traffic allowing -0- bot/fraud waste
    2. This schema is pretty much 30%-50% world wide --every country has pockets of wealth and the middle class that can possibly afford things.
    3. It's possible that the lower range would buy something too --more a necessity or essential
    One-Size does not fit all -- traffic uses server resources and many offers are picky about the traffic CR maintained.
    So, the question here is; what segmentation you can offer within the GEO (Region,Metro, City, Postal [US zip] code)?
    So, without selecting the local demographics GEO ISO-Code "US" is meaningless.
     
    Last edited: Aug 5, 2020 at 4:36 PM
    tyoussef likes this.
  10. Graybeard

    Graybeard Well-Known Member affiliate

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    good point ;
    __________
     
    tyoussef likes this.
  11. Juliette.D

    Juliette.D Affiliate affiliate

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    definitely agree with you!
     
  12. zeropark

    zeropark Traffic Manager Traffic Manager affiliate

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    We based that division 100% on the data that we've gathered over many years – so, that division is true for Zeropark's inventory and advertisers. :)

    As for more advanced segmentation, we offer region and city targeting with additional option to choose the language for push traffic (in case of targeting multi-lingual countries).

    Magda
     
  13. Graybeard

    Graybeard Well-Known Member affiliate

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    =================
    That's myopic IMHO.
     
  14. Anastasia_CasinoEmpire

    Anastasia_CasinoEmpire Affiliate affiliate

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    That's a great and very informative post, thank you! I might also say regarding Tier3 countries that even though the traffic cost is way cheaper but it's a big question if there is a profit at all from those countries so it is probably better to spend $40 instead of $10 but to have any ROI than zero ROI.
     
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