| name | offer-analysis |
| description | Analyze an affiliate offer for viability including payout, flow, restrictions, market size, target avatar, and creative requirements. Use when evaluating whether to run a new offer, comparing offers, or assessing offer-market fit. Incorporates Casto's offer spectrum concept, CPL/conversion analysis, and go/no-go decision frameworks. |
Offer Analysis
Evaluate affiliate offers for viability and profitability potential using proven media buyer frameworks.
The Offer Spectrum Concept (Casto)
Before analyzing any offer, understand where it falls on the Chad Spectrum:
Easy Offers (Chad Side)
- Work right out of the box
- Less dial-turning and optimization needed
- Creative really drives performance
- Broad targeting works well
- Can scale aggressively without bid/cost caps
- Example: New mass tort with large claimant pool, high arbitrage
Hard Offers (Technical Side)
- Require more work to create demand
- Need bid caps and cost caps
- More testing and iteration required
- Tighter margin management
- May need audience refinement
- Example: Mature evergreen offers with compressed margins
Key Insight: "The easier this is on the Chad spectrum, the less you have to turn the dials, the more the creative really just drives it with a good offer."
Mass Tort vs Evergreen Offer Dynamics
Mass Tort Characteristics
- Niche, short-term offers with high value
- Disproportional arbitrage - leads are super cheap initially
- Number of claimants is largest at launch - compresses over time
- New to market = largest opportunity window
- CPL naturally rises as claimant pool shrinks
- Conversion rate naturally drops over time
- Call center consistency affects disposition rates
- Revenue comes in 24-48 hours, with drip over 7-14 days
Evergreen Offer Characteristics
- Stable, long-term plays (auto insurance, Medicare, debt settlement)
- More predictable but tighter margins
- Higher competition, more saturated
- Requires sustained creative output to maintain performance
- Better for building consistent revenue base
- Network relationships become critical
Process
Step 1: Review Offer Details
Financial Metrics
- Payout amount and type (CPA, CPL, RevShare)
- Payment terms (Net 7, Net 15, Net 30)
- Payout caps (daily/weekly/monthly)
- Scrub rates (if known)
- Average conversion rate from network (critical for CPL offers)
Flow Analysis
- Traffic type accepted (Social, Native, Search, Email)
- Geo restrictions
- Device restrictions
- Funnel type (Direct link, Pre-sell required, Quiz)
- Disposition timeline - when do you know if leads convert?
Restrictions
- Creative restrictions
- Claim limitations
- Compliance requirements
- Brand bidding rules
Step 2: CPL and Conversion Rate Analysis
The Core Equation (Casto):
Average CPL × Average Conversion Rate = Average CPA
Average CPA vs Average Payout = Your Margin
CPL Benchmarks by Vertical:
| Vertical | Typical CPL Range | Expected Conv Rate | Target CPA |
|---|
| Mass Tort (New) | $5-25 | 15-40% | Variable |
| Mass Tort (Mature) | $25-75 | 5-15% | Compressed |
| Auto Insurance | $8-20 | 10-25% | $40-100 |
| Medicare | $15-40 | 8-20% | $75-200 |
| Debt Settlement | $20-50 | 5-15% | $150-400 |
| Solar | $30-80 | 3-10% | $300-800 |
Margin Analysis Framework:
- Healthy margin: 30%+ after all costs
- Acceptable margin: 15-30%
- Tight margin: 5-15% (need volume or backend)
- Danger zone: <5% (one bad day kills you)
Key Question: "I live and die by that margin. There's no backend for me." - Casto
Step 3: Assess Market Position
Market Timing Indicators:
- New offers appearing = growing opportunity
- Longtime players still active = sustainable vertical
- Many new entrants = possible saturation
- Declining payouts = maturing market
Competition Analysis:
- Who else is running this?
- Estimated spend in market
- Creative saturation level
- How long has offer been available?
- Are payouts compressing? (sign of maturity)
Market Size Assessment:
- Total addressable market
- Search volume for related terms
- Claimant pool size (for mass tort)
- Seasonality factors
Step 4: Identify Target Avatar
Demographics
- Age range
- Gender
- Income level
- Location
Psychographics
- Pain points (surface level AND deeper emotional drivers)
- Desires/goals
- Buying behavior
- Media consumption
Match Assessment
- Does avatar match your traffic sources?
- Can you reach this audience profitably?
- What bucket does Facebook put this audience in? (CPM pricing)
Step 5: Evaluate Creative Requirements
Content Needs
- Video vs static requirements
- UGC availability
- Stock footage availability
- Compliance-friendly angles
Production Effort
- Simple (existing templates)
- Moderate (new concepts needed)
- Complex (custom production)
Creative Volume Requirements (Based on Spectrum):
| Offer Type | Weekly Creative Output | Test Budget per Batch |
|---|
| Easy/Chad | 25-50 creatives | 1x target CPL |
| Medium | 50-100 creatives | 1.5x target CPL |
| Hard/Technical | 100+ creatives | 2x target CPL |
Step 6: Network Relationship Assessment
Network Quality Indicators:
- Payment reliability and terms
- Scrub rate transparency
- Real-time reporting availability
- Disposition feedback speed
- Account manager responsiveness
Relationship Building Questions:
- Is this network proven or new to you?
- Do you have leverage for better terms?
- Can you get exclusive offers or payouts?
- Will they work weekend leads? (critical for scaling)
Testing Budget Formulas
Casto's CPL Testing Framework
Minimum Test Spend per Creative Batch:
Minimum Test = Target CPL × 1.5-2x × Number of Ad Sets
Example:
- Target CPL: $20
- Creative concepts: 10 (each in own ad set)
- Minimum test: $20 × 1.5 × 10 = $300/day minimum
When to Pull Winners:
- Spending 1.5-2x target CPL with good margin = potential winner
- Test across 3-5 ad accounts before declaring winner
- Scale budget 20% increments (not aggressive jumps for lead gen)
Jason K's VSL Testing Framework
Initiate Checkout Method:
Test Budget = Target CPA × Number of Ad Sets
Example:
- Target CPA: $100
- Testing 12 avatars: 12 ad sets
- CBO budget: $1,000 with 5% minimum spend per ad set
Winner Criteria:
- A winner doesn't lose more than once in 3 days
- A winner doesn't lose more than twice in 7 days
- "Don't fall in love with an ad" - kill fast, don't hang on
Go/No-Go Decision Framework
GREEN LIGHT - GO if:
YELLOW LIGHT - CAUTION if:
RED LIGHT - NO-GO if:
Output Template
## OFFER ANALYSIS: [Offer Name]
### OFFER SNAPSHOT
- Network: [Name]
- Payout: $[Amount] / [Type]
- Flow: [Description]
- Geos: [Countries]
- Vertical: [Category]
- **Spectrum Position:** [Easy/Medium/Hard]
- **Offer Type:** [Mass Tort / Evergreen / Seasonal]
### CPL/CONVERSION ANALYSIS
| Metric | Target | Network Avg | Your Estimate |
|--------|--------|-------------|---------------|
| CPL | $[X] | $[X] | $[X] |
| Conv Rate | [X]% | [X]% | [X]% |
| CPA | $[X] | $[X] | $[X] |
| Payout | $[X] | - | - |
| **Margin** | [X]% | - | [X]% |
**Disposition Timeline:** [24hr / 48hr / 7-14 day drip]
### VIABILITY SCORES (1-10)
| Factor | Score | Notes |
|--------|-------|-------|
| Payout/Margin | X/10 | [Assessment] |
| Market Timing | X/10 | [Assessment] |
| Competition | X/10 | [Assessment] |
| Avatar Fit | X/10 | [Assessment] |
| Creative Ease | X/10 | [Assessment] |
| Network Quality | X/10 | [Assessment] |
| Spectrum Position | X/10 | [Easy = higher score] |
| **TOTAL** | XX/70 | |
### AVATAR PROFILE
- Who: [Description]
- Pain: [Key pain points]
- Desire: [Goals]
- Where: [How to reach them]
- CPM Bucket: [Expected pricing tier]
### CREATIVE STRATEGY
- Recommended angles: [List]
- Hook types to test: [List based on LeadsIcon framework]
- Production needs: [List]
- Weekly output target: [X creatives]
### TESTING BUDGET
**Phase 1: Initial Test (Week 1-2)**
| Item | Quantity | Cost | Total |
|------|----------|------|-------|
| Creative production | [#] | $[X] | $[X] |
| Ad spend (testing) | [days] | $[X]/day | $[X] |
| **Total Phase 1** | | | $[X] |
**Budget Formula Applied:**
- Target CPL: $[X]
- Test multiplier: [1.5x or 2x based on spectrum]
- Ad sets to test: [X]
- Daily minimum: $[X]
**Scale Readiness:**
- Break-even volume: [Leads/Sales per day]
- Scale budget if margin holds: $[X]/day
- Multiple ad accounts needed at: $[X]/day
### RISKS
1. [Risk 1 - e.g., "Claimant pool shrinking"]
2. [Risk 2 - e.g., "Call center weekend coverage unknown"]
3. [Risk 3 - e.g., "High creative saturation"]
### RECOMMENDATION
**[GO / CAUTION / NO-GO]**
Reasoning: [Explanation referencing spectrum position, margin analysis, and market timing]
### IF GO - NEXT STEPS
1. Secure network relationship and confirm disposition reporting
2. Set up tracking with CPL and conversion rate visibility
3. Produce first creative batch ([X] concepts × [X] variations)
4. Launch ABO testing with concepts in separate ad sets
5. Scale winners to CBO at 1.5-2x target CPL
6. Expand to multiple ad accounts at $[X]/day threshold
Evaluation Quick Reference
Green Flags:
- High payout with good conversion rates
- Large underserved market or new mass tort
- Clear avatar with reachable traffic
- Simple creative requirements (Chad spectrum)
- Good payment terms and disposition speed
- Network will work weekends
Red Flags:
- Extremely tight margins (<10%)
- Saturated market with declining payouts
- Complex compliance requirements
- Limited traffic sources accepted
- Poor network reputation or slow dispositions
- "I might not see reporting until the next day" scenario
- Claimant pool nearly exhausted
Spectrum Considerations:
- Easy offers = broad targeting, creative-driven, scale fast
- Hard offers = cost caps, bid caps, more testing, tighter management
Sources: Meta-CastovsJasonK, LeadsIcon-CreativeFlow, 8 Step Ideation
