Last time we explored traffic arbitrage and how to profit from it. Today, let’s dive into another exciting topic: search arbitrage.
Curious about search arbitrage and how it works? You’re in the right place. In this guide, we’ll break it down and share tips to help you succeed.
What is Search Arbitrage?
The concept behind search arbitrage is quite simple. First, you buy low-cost traffic through paid search, social media, etc. Then, you redirect this traffic to a monetization landing page, displaying ads or affiliate offers that generate higher revenue per click or action.
Here’s what these landing pages look like:
The key to search arbitrage is to minimize the cost of buying traffic while maximizing the revenue from monetizing it.
Search Arbitrage Example
Imagine, you launch an ad campaign targeting keyword phrases like “budget travel tips.” First, you buy traffic through Google Ads at $0.10 per click. When users see your offer and click on it, they’re directed to a landing page with travel-related content and ads. If the cost per click (CPC) for those ads is $0.20, you earn a profit of $0.10 for each click.
How Does Search Arbitrage Work?
Step 1: Keyword Research
First, an arbitrage professional selects a niche to work with, like finance, dating, healthcare, etc. We’ll talk more about niches further in the article.
Next, the arbitrage professional identifies SEO keywords that people use to find products within the niche. This can be done with tools like Google Keyword Planner. The goal is to find keywords with low competition (not many companies target them), which makes their CPC cheaper. However, these keywords should also have a high search volume.
Step 2: Traffic Acquisition
After collecting SEO keywords, the arbitrage professional launches an ad campaign to attract users. The higher the quality of traffic these ads bring in, the higher the payout is.
Here are various methods for acquiring traffic:
- Launch campaigns on search engines via Google Ads or Bing Ads.
- Create targeted ads on social media platforms like Facebook, TikTok, and others.
- Make native ads on different websites via platforms like Taboola or Outbrain.
- Use an in-app advertising strategy.
The arbitrage professional specifies the targeted keywords and audience details, including GEO, age, gender, interests, etc. They also set a pricing module. It can be cost-per-click (CPC) or cost-per-action (CPA).
Step 3: Traffic Redirection
After users click on the ads, they are redirected to a landing page that looks like a typical search engine. There, you can find various search results and ads related to specific words. For example, the results would be related to travel if we targeted the “budget travel” keyword.
A feed provider helps create this page.
Feed providers are companies, offering services that allow websites to display search results or ads. They deliver relevant content to users based on their searches or browsing behavior, which helps website owners monetize their traffic. These providers are System1, Domain Active, Tonic, and others.
Step 4: Profit Generation
The arbitrage professional earns income from clicks and impressions on ads displayed on the landing page. They might also get paid for conversions if they have the search results lead to affiliate offer pages.
However, the money from these ads isn’t the final profit. A traffic arbitrage professional must subtract ad income from a total acquisition cost and other expenses, like tracking tools and software.
Remember, you need to purchase traffic at a low cost and redirect it to a page where it can be monetized at a higher rate to earn with search arbitrage.
Is Search Arbitrage Profitable?
Search arbitrage requires dedication and time to succeed. You’ll have to analyze and optimize your approaches constantly. Identify good GEOs and traffic sources. Make sure that your campaigns generate income, not losses.
Here’s a list of some key factors to consider:
- Ad costs: Ad costs aren’t the same across different platforms. You’ll have to find low-cost keywords with a high search volume; some untapped niches, others don’t target yet. It can be difficult, but possible.
- Traffic quality: If you attract users who don’t need the offers you promote, they won’t generate clicks and revenue. Analyze your target audience to attract high-quality traffic.
- Relevance: Optimize ad creatives to fit your audience’ needs. Make sure that your landing pages provide the visitors with high-quality UX.
- Analytics: Search arbitrage success heavily relies on data analysis and constant optimization. Tracking tools and data analytics can help you identify profitable opportunities and adjust strategies.
Traffic Sources for Search Arbitrage
An arbitrage professional’s job heavily relies on researching low-cost traffic sources. After all, that’s the main premise of arbitrage. Here is the list of options to study and test:
Paid Search Traffic
These ads appear on Google, Bing, and Yahoo. They are marked “sponsored” and usually displayed as the first few search results.
The main advantage of paid search traffic is direct targeting. Your ads appear when users type in your targeted keywords, meaning they are already interested and likely to click on the offer.
Social Media Traffic
Social media platforms provide you with various ad formats. You can make display ads, video ads, or sponsored posts with influencers.
With social media, you can reach wider audiences to attract new users to your monetization landing page.
Native Ads
Native ads are called “native” because they’re designed to blend in with the website content. For example, they can look like articles on news websites. After you click on them, you’ll be redirected to another page.
The great advantage of this format is its “native” nature. Native ads don’t look like ordinary ads, making them more appealing. This increases the likelihood of user engagement.
Display Ads
Display ads are one of the most common ads you come across online. These are ads placed on websites as banners or videos. You can launch display ads via ad networks, like Google Display Network.
Display ads are all about visuals. Banners with appealing pictures and eye-catching videos are more likely to generate clicks.
Mobile Ad Networks
These networks provide various ad formats, like banners, videos, etc. As the name implies, they are all optimized for the mobile user experience.
The advantage here is that you can integrate your ads with mobile apps, allowing you to reach even wider audiences.
How to Choose GEO and Niche?
To make arbitrage as profitable as possible, you need to determine two things: what to promote and where to promote.
For “where,” identify GEOs (regions) with high traffic and, preferably, low competition. To do so, you need to research and run A/B tests for various traffic sources and countries. See which bundles perform best and drive traffic using them.
As for “what,” pick a niche to promote. Some profitable options are finance, security, and healthcare. These fields generally attract a lot of interest and search activity, making them good targets for arbitrage.
However, you can look at specific sub-niches of these topics. For example:
- Personal finance advice: Information on managing money, investing, saving, and budgeting.
- Security testing services: Services helping businesses and individuals protect their data and systems.
- Health and wellness products: Products related to fitness, nutrition, and overall well-being.
- Web building services: Platforms that provide tools for creating landing pages, websites, and online stores.
- Insurance: Various insurance plans, such as health, auto, home, and life ones.
Sub-niches usually have a high search volume, meaning people are interested in them. Arbitrage professionals can use this demand to their advantage and convert it into revenue.
Best Search Arbitrage Practices in 2024
- Test, test, and test. Set aside at least 30% of your budget for testing and use it to identify the most converting traffic with a low cost.
- Monitor your competitors. Analyze your competitors and see what strategies they use. Check their creative and targeted GEOs. These insights help you stay competitive.
- Use different traffic sources. Don’t just settle for one source. Over time it will most likely become less profitable and less converting. Continuous testing allows you to identify the most profitable sources, GEOs, and creative approaches at this moment and earn more.
- Stay up to date. Monitor the latest trends and updates in traffic arbitrage and marketing. This includes new policies, changes in algorithms, or advertising platforms. Also, see if there are new tools that might impact your work.
- Create converting landing pages. Your page should have clear CTAs and a fast loading time, as well as be optimized for mobile devices. Run A/B tests to check your theories and see which pages work better.
- Analyze and optimize. You need a tracker to see how your ads are performing. For instance, Keitaro Tracker provides reports with 30+ built-in metrics and over 500 ready-made CPA and advertising network templates to gather extensive data on clicks and conversions. It also offers a white and black list feature for protection against fraudulent clicks.
By implementing best practices and tools, you can make search arbitrage successful. Test, optimize your campaigns — and follow Keitaro Tracker for more tips and digital marketing insights.
