A client of mine recently asked me to prepare a PPC quote for her company. She wanted to know what the least amount of money she could spend (of course) to run PPC (pay-per-click) with Google Adwords. What she didn't say, but which was implied (from other conversations she and I have had), is how much did she have to spend in order to get some leads? That's the burning question, isn't it? That number will include how much she spends in click charges to the search engines. Some companies also want to factor in the cost of paying an SEM agency to acquire those leads through PPC. So let's take a look at that question first, and then secondly I will give you the PPC Quote breakdown I sent her, anonymized, of course.
Online marketing, especially search engine marketing, gets what feels like exponentially more competitive every year. You, dear reader, must take this to heart -- it's not possible to just run a list of keywords to your website via Google Adwords or Bing Ads and expect to get leads and/or sales (there are always exceptions to the rule, but not many frankly).
Unless... these two elements are the kickers:
HOW TO RUN A SUCCESSFUL PPC CAMPAIGN
Your success with PPC will depend on 2 things:
a.) how well your PPC campaign is set up -- do keywords + ad copy attract the right visitors?
b.) how well the page (a.k.a. "landing page") they come to after clicking the link in your ad is able to "convert" them (creativity + offer + timing).
If the visitor doesn't take an action on your site and join your sales funnel at some level, you've not converted them from a visitor to a customer or future customer. They haven't converted to a form you can utilize for your bottom line yet.
PPC RESEARCH & DUE DILIGENCE
As a demonstration, I pulled a keyword list from Google's External Keyword Tool for my client (she's in the insurance industry). The list showed that the CPC (cost-per-click) for the top position was over $10 for many of the words -- although bear in mind the tool only gives national CPCs and not necessarily local CPCs. Meaning, if you run a small campaign in a specific geographic region, there is a possibility you will pay a lot less on your CPC.
Competition was also looking stiff (indicated by the green bar in the keyword tool). Another way to gauge competition is to type in your keyword phrase and look at the number of vendors vying for a Sponsored Ads position.
Whenever running PPC, your objectives are to keep cost low and conversions high. This cannot be overstated.
HOW MUCH SHOULD I PAY FOR A CUSTOMER GAINED THROUGH PPC?
I explained to my client that she could end up paying as much as $50 - $100 in click charges (paid directly to the search engines) for ONE (1) lead... Although I was only estimating, it brings up an important point -- before running PPC you must know how much you can spend on gaining a new customer or lead.
Can your company afford $10 or $20 for a lead or sale on average? Your company has to determine this value in advance and communicate this with your PPC provider or manager. Your PPC manager or company can help you determine this value if you ask him or her.
This value should probably be a blend of your Short-Term and Long-Term Customer Value (SCV and LCV). It should also be an average between what you are willing to pay for direct brand terms and non-brand terms. So, in actuality, you have two values -- the amount you're willing to spend on a BRAND PPC customer or lead and the amount you're willing to spend on a NON-BRAND PPC customer/lead. If you don't know what that means, post a comment below and I'll do my best to explain :o)
SETTING EXPECTATIONS EARLY
Your PPC Manager cannot guarantee he or she will deliver leads to you. They are being paid for their time and expertise to provide the service of setting up your PPC campaigns using Google's best practices and their own experience.
They are paid for their time to set up the campaigns, as well as the time it takes to answer your questions, provide reports and discuss the account or provide further consultation via the phone. None of that is guaranteed to produce leads or sales.
Note: If you want to purchase leads, you may want to think about doing just that (also an internet service, but one which our company does not provide.
LANDING PAGES ARE A TOPIC UNTO THEMSELVES
...and are an integral and key piece in any PPC campaign. To have a truly successful campaign, this is an investment that must be made either sooner or later. If you're campaigns don't produce results running to your existing site's pages, you need special landing pages. Do yourself a favor if you can afford it and have an expert do it for you. Or learn how to do it if your are a "DIY-er". For ideas and illustration, look at your competitors landing pages to compare what you are up against.
CREATIVITY IS A BOON
What I noticed when taking a look for my client was there was just a list of dry ads -- "Buy Insurance Here" type headlines. I did not see one ad offering anything for FREE. Like a whitepaper or video with helpful (truly) info for the searcher. If you're industry is highly competitive, consider paying a lower CPA (cost-per-acquisition) just to get the visitor INTO Step # 1 of your sales funnel. From there, you can continue to reach them via email. If you rolled your eyes, stop it. Email still works.
THE GOLDEN NUGGET -- TIME & TESTING
The free report or coupon idea is a suggestion I made to my client that poses a risk of failure. That's why it's so important to be willing to Experiment and Test. Set a test budget and time allotment to lay out a follow-up strategy and track your efforts.
What it comes down to is a commitment to the follow-up and to experimenting (i.e. testing) until that sweet spot is found. There is no magic bullet.
Here are two possible scenarios for a PPC Plan of Action:
PPC QUOTE - SET-UP
To run on Google's Search Network Only (Google's Display Network would require more time)
PPC QUOTE - MONITOR / MAINTAIN
AFTER THE TEST: Once we've run out of $500 or 2 weeks of time, and you wish to continue running your PPC campaigns the cost will be 2 hours/week to maintain what you have + you pay your own click charges. If you want to grow into other areas or test other products, each new campaign is 2 to 4 hours to research, setup and launch
IN CONCLUSION...TO RUN OR NOT TO RUN PPC?
It's a significant investment with no guarantee. But what else are you going to do? We may need to have a serious conversation about what it's going to take to compete online -- it's not cheap, especially for insurance. You may wish to go get quotes from other agencies to discover what an amazing value I actually am . Online marketing in this day and age does take time. I can guide the efforts using best practices and my expertise but I can't do it for free (or even discounted as I have already given you a lower rate than normal) as it's very time and expertise intensive.
Marketing online is a lot like building a house or business. It takes time, patience and commitment. It costs a lot on the front end -- either in your own time to learn, or in paying an agency or provider to skip the learning curve and get faster results. First, you build a foundation, then you keep building until you are about to live in your house comfortably. Then you need to maintain it, perhaps continue to develop it according to your needs.
Hi Level SEM brings you commentary by Zhenya Delate and team on the latest news in the SEM and internet marketing world, from our vantage point in the Hawaiian Islands.