I guess we all know how we can set up a split test of two or more pages to determine which one achieves the highest sales conversion rate.

When running any split test it's important that the results are "statiscally significant" based on the number of actions taken: Number of sales, optins, downloads, etc.

Assuming that you have X actions from your control copy, and Y actions from your test copy (where X is the better performing one).

If the difference in the number of actions (X – Y) is greater than the square root of the total number of actions (X + Y), then the difference is statistically significant.

It's generally thought that significance is achieved after 40 actions. But the above formula should be applied to be absolutely sure.

Check out "small changes : Big Profits" - it's probably the most comprehensive book available on the topic of testing and tracking.

Let's look at using split testing for competitive purposes..

First of all, have you considered evaluating a range of similar products as an affiliate?

If you want to discover which is the most profitable product to promote as an affiliate, simply set up your split test script to rotate all the competitive products, check your traffic stats with your sales and you'll see which product generates the highest revenue. As I'm sure you'll discover, the product with the highest commission isn't always the winner!

Secondly, here's one of my "secret" split testing strategies that I've never revealed before.....{+}

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Let me take a moment to explain how I calculate my break even point; and then we can move on to why understanding your niche's demographic can save you a lot of money and tap into targeted traffic at a much lower cost..

For example, let's say that we're promoting a £279 product with a 10% affiliate commision. That means each sale will generate £27.90 and, if the sales letter is converting at the typical 2%, our income per visitor will be: (£27.90 x 2)/100 = £0.558. So our PPC breakeven point is 56 pence and anything less than that will earn us a profit.

Now, when I see my competitors paying 56 pence per click and above, my decision is easy. I'm going to leave them to it and move on to my "Plan B" where I'll target the same audience but I'll attack the market from a completely different direction based on my in-depth knowledge of the demographics.

Plan B requires a little "out of the box" thinking. Let me explain.. ...{+}

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I don't want to burst too many bubbles, but the continuity business model has been around a very long time.

I can remember when I was around seven or eight years old, yes that's nearly half a century ago.. there's no need to rub it in!

Anyway, even at that young age, I was very much into reading and my parents were keen to encourage me. Every month I received a brand new story book. I really looked forward to receiving those parcels, tearing off the wrapping paper to see which book I'd received. They were great stories of adventure and I thoroughly enjoyed them.

Getting back to the point...

My parents had signed up to a "Children's Book Of The Month" club. They paid a monthly subscription and the arrangement was that they would continue to pay that monthly fee until they cancelled.

Many organisations use the same payment structure.. Reader's Digest, Franklin Mint, are just a couple that immediately come to mind.

And, while the offline world benefits from using the continuity model, the Internet offers a much wider range of possibilities including much more potential to automate the billing and fulfillment processes.

In fact, this membership blog is based on the continuity model, as it uses the PayPal subscription facility to automatically collect  monthly payments from Premium Members. That means that I can concentrate my efforts on providing great content without having to spend time collecting cash.

One of the greatest advantages of the continuity model can be seen when you consider the cost of customer acquisition.

When you sell a single product, your advertising and marketing costs must be deducted from the sales price to determine your profit.

When you sell a membership, or other subscription, your advertising and marketing costs can be deducted from the lifetime value of the subscription.

As a seller, I'm sure that you'll appreciate that it costs far more in terms of time, effort and budget to sell a $97 information product than it does to sell a $9.97 product. As a buyer, I hope you'll agree that investing $9.97 is an easier decision than spending $97?

There are several benefits to the buyer too..

• The investment is made in small multiple payments rather than a relatively high one-off price.
• The cost can be budgeted for in advance.
• The cost of access is much lower, thus reducing the risk.
• Subscriptions can be cancelled at any time.
• Content is delivered in smaller easier to "digest" bites.

So, when considering your next product, think about the cost of acquiring a new sale and compare the numbers.