Before creating a pay-per-click (PPC) campaign, clients will often ask us how much AdWords budget they need to spend to get a specific number of clicks. Or similarly, they ask how many clicks they can get for a certain budget. While both are completely valid questions to ask, the number of variables that enter the equation makes any answer an educated guess at best.
The Google AdWords Traffic Estimator can provide a range of clicks, impressions and cost based on input keywords, maximum cost-per-click (CPC) and a daily budget. However, these estimates are just that—estimates – they do not take into account critical factors that can dramatically increase or reduce potential clicks. Often, the effects of these elements on performance of your pay-per-click campaigns are unknown until campaigns have been running for weeks at a time.
Quality Score: An often overlooked yet important statistic, quality score determines CPC and influences the number of impressions generated, which can directly impact the potential number of clicks. While the AdWords interface only shows one quality score for each keyword phrase, the algorithms track multiple quality scores for each keyword phrase in relation to each ad, as well as the average quality scores of the entire account.
Furthermore, Craig Danuloff’s book, “Quality Score in High Resolution,” describes how there are some keyword markets, such as financial or medical, that Google automatically assumes will perform poorly, making it difficult to earn decent quality scores. Therefore, you may have to automatically pay higher CPCs no matter what, which will reduce your click potential.
Ad Copy: You could have an endless budget but if your ad copy is not written for your target audience, then the resulting number of clicks will be lower than estimated. At R2i, we put particular emphasis on utilizing available characters in the ads and creating multiple ads that test different messages and styles; however, you only know which ads will resonate best with your audience through live testing.
Keywords: The selection, grouping, and optimization process of targeted keywords has a large impact on the success of your ad groups and campaigns. You can create campaigns based on Google AdWords best practices, but you may need a different set-up, depending on your budget, audience and goals.
Furthermore, keyword lists should be dynamic, monitored, and optimized, according to analysis of performance data such as CTRs, conversions, or search terms. So for example, if a keyword earns a lot of clicks but zero conversions—is the keyword worth your budget?
Negative Keywords: Do you want clicks or do you want clicks from your target audience? Almost as important as your targeted keywords, negative keywords narrow your available impression share to only those who you want to target; the Google AdWords Traffic Estimator does not factor in negative keywords.
Ad Extensions: Ad extensions can earn additional clicks from ads in top positions through offering additional links to your site, click-to-call options, Google+ Places pages, etc. While these can increase your clickthrough rates, they should only be used when appropriate for your campaign goals and audience.
New vs. Existing Account: Good or bad, Google AdWords uses your account’s historical data in their algorithms– the better your account history is, the better your new campaign quality scores and performance will be from the start. If you have a new account, Google uses average historical data for your targeted keywords from Google AdWords accounts until you have enough data for your account to use, meaning well-managed campaigns can increase performance statistics as weeks progress.
Campaign Settings: Campaign settings should be selected with your target audience in mind. Modifying campaign settings allows you reach your target audience in a variety of ways, including; showing ads 24/7 vs. day-parting, targeting specific geographic areas, and targeting specific age groups. Changes to these settings will cause your target audience to narrow or broaden, thereby influencing the potential traffic and spend these campaigns will generate.
So what does all of this mean? Simply that rather than focusing on the number of clicks, you should focus on the quality of those clicks. Keep in mind that 10 converting visitors for $8 each are more valuable than 20 non-converting visits at $4 each. Your AdWords management team should be continually optimizing your PPC campaigns to reach your target audience and earn clicks while also monitoring PPC visitor behavior when navigating your site.
After a few weeks or months of live campaigns, you will know whether or not your media spend is worth the results. A recent BusinessInsider.com article (http://www.businessinsider.com/forrester-social-media-and-retail-report-2012-9#ixzz27cK3tJMe) noted that “paid search traffic is the most effective way for retailers to engage new customers,” so no matter what your budget is, the best way to know if PPC is right for your company is to give it a try!
If you have any questions about the above content or your Google AdWords account, please feel free to leave questions or send a tweet to @r2integrated.
Credit: Danuloff, Craig. Quality Score in High Resolution. Durham: Potato Creek Books, 2011.