Whilst it might sound like a simple question, the ‘what is PPC?’ has a number of levels to it that makes the initial answer ‘pay-per-click’ a little more complicated. What I’ve tried to do here is tackle some of the more frequently asked questions around PPC that I hear from business owners.
What does PCC mean for my marketing budget?
Essentially, Pay-Per-Click means that you pay every time someone clicks on one of your adverts, wherever that advert might be displaying.
Do I pay immediately?
In most cases no. Depending on where you’re PPC campaign is, you’ll normally rack up credit with the company serving the ads before they charge your credit card or issue you an invoice. That level of credit can be set to whatever you require. Google, for example, will charge you after the first $100 is spent, and then will increase that credit level gradually, normally up to about $1,000.
However most channels do require a credit card. There are very few that I’m aware of that will allow you to pay by invoice. Google do have a bank transfer option in their system but it’s deliberately hard to use and the transfer amount is low in order to make it hard to use.
If Google fails to charge your credit card for any reason, they will immediately put the ads on hold and won’t release the account until the full amount has been paid. And of course, Google have a fairly sophisticated system for getting the money back from people if they fail to pay. So best not go testing them.
What types of Pay-Per-Click are there?
There are a lot of different types of PPC. Google has perhaps the most recognised in the form of Adwords, which itself has a number of different variants such as Display, Search, YouTube, Remarketing and so on. Each one serves a different purpose and attracts a different type of customer to your website.
All the other major search engines have their own – Bing, Yahoo and so on, as do the major social networks such as Facebook, LinkedIn, Twitter and Instagram. There are also other companies that have their own PPC networks such as Quantcast and Outbrain. Once again, each PPC system on these channels works in a different way, targets different customers and delivers a different result.
How much should a click cost?
That is a huge variable. Clicks in certain channels and in certain geographical regions can cost a matter of cents; whereas in some business sectors with heavy competition from large corporations, clicks can cost over $40. For example, in the US, the most expensive keyword is ‘business services’, costing a massive $58.64 per click.
Chances are your business won’t be spending anywhere near that, but be prepared that it could range from anywhere from $2 to $15. With this in mind, it’s vital that the website page they land on has been created in order to convert them. A bit more about that below.
You can also cap the price you’re prepared to pay for a click when you get started. If $15 a click scares the crap out of you – which if you have a $20 a day budget, it probably would – then you could cap the amount you’re willing to pay at $5. Of course, as most pay-per-click systems operate a bidding system for their clicks, this could mean your ads might never be shown.
Why is PPC good?
There are a number of reasons your business should be using PPC. First, it’s easy to control your budget with PPC either per click, or on a daily or monthly basis. If you only want to spend $500 a month, you can set that number with Google (albeit by breaking it down into a daily spend) and you won’t go over it.
Secondly, you can turn it on and off whenever you want. Many businesses might shut down over the holiday seasons and find it pointless driving traffic to their website when there’s no-one there to service them, so they might turn their adverts off for a short period to save on wasting budget.
And finally, there’s a lot of data and information available on most PPC platforms so you can really drill down to see what people are doing when they look for your site. This can help you make all sorts of improvements across your business. Working with a number of clients over the years, we’ve actually discovered a number of new keyword phrases within the PPC traffic; sometimes keyword phrases have given us great ideas for blog topics too.
Does that means someone is going to buy from me if they’ve click my adverts?
Well, no. Getting someone to your website is just the first step. If your website isn’t set-up to convert those visitors to clients or buyers, then you could find yourself spending a lot of money with no result. Effective landing pages aren’t complicated to set-up and there are many programs that can create them with a simple drag-and-drop. One of our favourites is Instapage.
It’s important to marry up what’s appearing on the advertisement with what people are seeing on the landing page. Giving them the ability to take action immediately – whether that’s to buy something from you or contact you in some way – is vital. The last thing you want is for people to see something they’re interested in and then they struggle to actually find where they can engage with it.
Remember for every additional click someone makes on your website, the more chance you have of losing their attention. Get to the point quickly and ask them to take action to contact or buy from you.
What factors affect the success of my PPC?
There are a huge volume of factors that make up the success of any PPC campaign. I’ve tried to dissect a few key ones below.
Shit ads don’t get clicked on. For banner adverts you have to make sure you create something both eye-catching and appropriate. If you have the budget think about rotating banners (gifs) that can have three or four different panels with a sequential message.
Much like the creative, text-based ads need some serious thought. For one, it’s important to try and factor in the user’s search terms into the advert. If they’re tapping in ’emergency plumber Brisbane’ in their Google search, they need to see an ad where the copy has ’emergency plumber Brisbane’ in the copy.
Obviously with the huge numbers of differing keywords being typed into Google every day (in fact 15% of the keywords typed into Google every day have never been seen before) it’s impossible to match every search precisely with an advert. But it’s very easy to create multiple versions of ads in order to try to match them up as closely as possible.
Mentioned above, landing pages need to link through from the ad copy all the way back to the original phrase typed into the search engine. User searches for a term, sees an ad with that term in it and is taken to a landing page that focuses on that term.
Time of Day
Pay-per-click ads can run 24/7 but this might not be the best strategy for your business. After all, who is looking for an accountant at 3am in the morning?
Although a counter argument to that could suggest that anyone who IS searching for an accountant 3am in the morning, probably really does need some help, and after finding your website, might contact you at 9am the next morning.
This is where ongoing testing and management is important.
Especially if you’re using Google Adwords, there is a challenge that some people will click on ads looking for jobs rather than help. And if that’s something that keeps happening, you’ll find you will end up wasting budget in order to tell people there are no jobs available.
There’s no real way of eliminating that issue completely, but you can protect against it a little but using various negative keywords (words that when typed by the user stop your ad being shown). I often start off with adding in ‘jobs’, ‘job’, ‘career’ and ‘careers’ in as negative keywords straight away.
Should I be worried about click fraud?
Click fraud is defined as such:
“The practice of repeatedly clicking on an advertisement hosted on a website with the intention of generating revenue for the host website or draining revenue from the advertiser.”
There’s many ways this can happen but if you’re working with a reputable PPC channel, then this sort of thing shouldn’t be a problem. They all have ways of determining if click fraud is occurring and it’s more than likely that you won’t be billed multiple times for someone repeatedly clicking on your ad.
If in doubt, it’s best to check that channel’s approach and deterrents to any sort of click fraud.
What other terminology do I need to know?
The world of PPC is full of acronyms but there’s a few that will be important for you to understand.
CTR = click through rate. The rate at which your advert is seen, versus the rate at which it is clicked.
CPC = cost per click. The amount of money you spend every time someone clicks your advert.
CPM = cost per 1000 impressions. The cost to show your advert one thousand times. This could be a very low amount but there’s no guarantee anyone is going to click on the ads.
ROI = return on investment. The most important acronym of them all: how much money your business makes from the money you spend. There’s no real benchmark for you to look to because there are so many different industries, but you should be aiming for at least 300% to 400%. You might think that’s low, but remember, new customers can become repeat purchases if managed properly – so it’s best to use a longer customer lifetime value as the return, instead of just that single sale.
What’s a good CTR?
Much like the ROI, different industries and different networks have different CTRs, so creating a single benchmark for all of them is impossible. But if you’re looking at a 4% to 5% for search CTR then you’re doing a good job. Display will be much lower but if you’re achieving 0.5% then that’s a good job too.
Of course, it’s all relative. If the clicks aren’t from good potential customers, then it’s likely to be a waste of time and money. A 5% CTR delivering customers that take action on your site is better than a 40% CTR with junk traffic.
How much does it cost to have someone manage PPC?
Most agencies and digital marketing consultants charge between 15% and 20% of your overall spend to manage your account. Normally there is a minimum spend per month too. There will normally be additional costs for creating landing pages and designing display banners too. These can range in price quite significantly depending on who is doing them for you and what type they are creating (static banners are cheaper to produce than animated HTML5 banners for example) so always ask for a quote first.
PPC is a complicated beast, especially for small to medium sized business owners who may not have the skills within their team to get maximum benefit from their budget. Many times, we’ve seen businesses experiment with PPC, fail and then declare the channel ‘doesn’t work for them’. That’s simply not the case.
Google especially has some complicated exams for Adwords that are normally 90 minutes or more in length, so assuming you’re going to master their channels in an afternoon and get a great result is way too optimistic.
This is one of those areas you’re better off in the hands of an expert. Drop us a line on firstname.lastname@example.org or call us on 07 3198 2483 and we’d be happy to give you some initial advice free of charge. If you’d like us to look at your whole digital position, then fill in our digital marketing audit form and we can produce a full report for you.