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Top 5 Common PPC Questions Our Paid Acquisition Expert Answers

Running paid ads on Google, Facebook, and various other paid platforms is often new and exciting to any business owner looking to crack into new sources of leads. In my role as a Paid Advertising Specialist at Tuff, I partner with CMOs and business owners and get the opportunity to answer their initial questions when getting started. Here are the most common PPC questions and responses to those questions.

Let’s dive in!

1. Is PPC right for my business?

This is a big one, the most high level of common PPC questions. Owners and entrepreneurs have seen ads all over the internet and usually have fair concerns about the validity and effectiveness of them. I look to a few specific things to answer this question:

What industry are you in?

The type of business you operate is of big concern to me. If you are a niche business with no competition and Keyword traffic, PPC is a great fit for you. If you are a brand new Real Estate Investor in a crowded NYC market that has a ton of expensive competition, PPC would be a tough nut to crack. Usually clients fall somewhere in the middle and it’s my job to find the sweet spot in the market space.

Do you have systems in place to handle leads?

It’s not a great experience for potential customers if there isn’t a sales funnel or process in place to convert this new channel of incoming leads. It’s important to ask yourself, does my business have a reliable CRM? Will my business be able to provide a reasonable amount of creative flexibility with landing pages to test new traffic? Do we have a reliable IT process?

How much traffic is out there for you?

This might be the most important starter question. I always check if there is enough traffic out there looking for exactly what your business does, using Keyword tools like Keyword Planner, and SpyFu. Bottom line, if there’s not enough traffic PPC might not be the answer. Traffic doesn’t just mean Keyword impressions, it could also include audience groupings for display, youtube, facebook, etc. If there aren’t market segments that exist already, you would essentially be creating a market, and for a lot of business owners the capital to do that is limiting.

2. How much should I spend?

This usually comes on the heels of agreeing that PPC is right for you. Now, it’s time for me to align PPC expectations:

What are your goals?

There is a big difference between looking for engagement to drive leads and looking to drive sales of a very expensive online item through paid ads. This question is an opportunity for me to set realistic expectations based on experience and traffic estimates. This is also a great time to be more specific about how we plan to turn cold traffic into warm traffic through blogs, white papers, videos, etc. This is where an experienced PPC manager will explain that turning extremely cold traffic into a sale through one ad and landing page might be too big of an ask.

What is the lifetime value of your customers?

The lifetime value of your customer is an important metric to track. This metric should be ingrained within the decisions you make about balancing your own books. Knowing the lifetime value also helps a PPC manager assess how much we should spend to get a lead and customer or sale through the paid advertising.

Knowing these two things helps me set a baseline budget for testing and makes sure I’m optimizing my campaigns against the right ROI targets.

3. What will I get in return?

So, we’ve decided PPC is right for you and set a budget for testing. Then, we dive into some more questions:

What are you hoping to get in return?

When it comes to maximizing your results with PPC, the first step is to identify an ROI target. While this can be difficult to track, it’s one of the most important KPIs for your business and advertising health. During this stage, I work with you to set reasonable lead and ROI targets.

What are your historic conversion rates from traffic to lead?

This is a necessary metric to know as a PPC manager. With these historic numbers, I can set a baseline for your PPC performance. If conversion rates are too low based on PPC traffic, your targeting isn’t hot enough.

What are your historic conversion rates from Lead to Sale?

Similar to above, this metric is important to grade the continuity of your marketing efforts from ad to sale. If you are getting a ton of leads but no sales, a) your ads aren’t in line with the messaging on site, or b) the site in general isn’t great at converting colder traffic. As an end-to-end growth agency, we love analyzing if it’s a or b and can help optimize either.

With all the above, you can forecast some average conversion rates and some very conservative numbers on what you can expect from the PPC efforts.

4. What platforms should I be on?

This is where we breakdown the platforms for our clients and help them select the right channels to reach their goals. As a general rule, if the objective is brand awareness, we’ll typically start with Facebook, Instagram, or Pre-Roll YouTube ads. Video is an excellent ad format when it comes to reach and impressions, so we’ll often push for this type of creative asset to maximize brand lift.

If you’re bootstrapped and on budget looking to drive leads, conversions, or sales, we often launch search campaigns on Google and Bing knowing these might be more expensive clicks, but should convert at a higher rate than other platforms since users are actively searching for a solution or product. In other words, the search intent is higher.

Selecting the right platform to reach your objectives is one of the single most important pieces of the strategy phase. And, in the ideal world, we leverage a handful of PPC channels to reach potential customers at every stage of the buyer funnel – from awareness, consideration, and conversion with a variety of ad formats and retargeting.

5. I see my competition all over the internet. How can I do that?

You’re right to think that way. If your competition is doing it they’re taking money off the table. We like to investigate a little further with this common PPC question:

Is copying your competition best? (Think USP)

Any PPC manager should remind you that copying the competition isn’t always the best strategy. Maybe they’re doing a great job and you can borrow a thing or two, but ultimately, they are separate businesses with separate Unique Selling Propositions that should be built into the ads.

Are they bidding on your brand?

If competition is bidding on your brand terms you should 100% get into the game. That other business is stealing business from you, bottom line. From personal experience, businesses have had shut their doors because other digital marketers have cannibalized their brand terms online.

Are they across all platforms?

This is great to research because it can yield opportunities for an account manager. What if a business is slaying it on Amazon but not on Google? What if a huge brand is owning Google but not on Bing, and that competitor can bid on their brand terms? What if none of them are on FB?

We’d love to work with you.

Schedule a call with our team and we’ll analyze your marketing, product, metrics, and business. Then, present a Growth Plan with actionable strategies to find and keep more engaged customers.

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How Good is Your Paid Advertising, Really?

How does your paid advertising stack up, compared to your competitors? Where does it fall compared to other businesses where your customers spend money?

Whether you’re doing PPC for the first time or your company has been running campaigns for years, it can be daunting to know whether or not you’re doing a good job. In fact, benchmarking your paid advertising against other companies can be more complicated than measuring the results of your own efforts.

Here’s a simple 3-step process for creating your benchmarking report:

1. Understand the metrics that matter most

Earlier this year, Wordstream dug into their clients PPC data and compiled Google AdWords benchmarks across 20 different industries.

They evaluated their accounts based on the following metrics:

  • Average Click-Through Rate (CTR) in AdWords by industry, for Search and Display
  • Average Cost per Click (CPC) in AdWords by industry, for Search and Display
  • Average Conversion Rate (CVR) in AdWords by industry, for Search and Display
  • Average Cost per Action (CPA) in AdWords by industry, for Search and Display

These metrics vary depending on industry. A useful metric for one industry isn’t necessarily helpful for another. What’s important is that you don’t need to compare every possible metric. With the four metrics above, you’ll have a good sense of what is working and what isn’t and how you can improve.

2. Collect data

Now that you have target metrics for your industries paid advertising, the next step is the execute your campaigns. Once you’ve hit “enable”, your campaigns will start running and the data will begin to populate in your account.

Instead of focusing on a short window of time, we like to focus on at least 30 days. You don’t want to get buried in too much data, but you do need enough data for your evaluation to be statistically relevant.

3. Analyze the results

At this stage, you’ll map your internal scores for the same metrics against your collected data. Where are you doing well? Where are you falling behind? What smart ideas can you quickly implement? How can you improve?

Let’s look at two different Tuff client accounts and walk through different ways you can analyze and understand your results.

eCommerce

Tuff has been partnering with a high-end jeweler in the US for over 2 years. Working closely with their marketing team, we manage their paid advertising for YouTube, Instagram, Facebook, Bing, and Adwords, spending around $150,000 per month in media allocations.

In the chart below, we’ve compared their Q1 Search Performance with the industry average. Here’s how our team tackled the assessment:

CTR: We’re only slightly above the average on CTR which made this feel like a key opportunity to improve. Using this info, we sorted our ads from top performing to lowest performing. We kept our top 50% and generated a new set of ads to replace to lower CTR ads. We also layered on two new ad formats: Call Only Ads and Responsive Search Ads.

CPC: Our cost per click is higher than average so we can tackle this in a few ways. We started by asking two fundamental questions: Can we identify keywords that have a high number of impressions and clicks, but zero conversions, orders, or sales? If so, let’s kill them. And can we use more restrictive match types (modified broad and exact) to filter out unqualified traffic? If so, let’s tighten up our match types so we can eliminate waste.

CVR: For now, no action items within the account. We’ll continue to monitor and tackle this next benchmark report.

CTA: This is one of our favorite metrics. How much did it cost you to acquire a lead, sale, conversion? This account has 56 search campaigns with a different CPA for each. We know exactly how many leads we need to convert a sale and what are ROI targets are at each campaign. Compared to the industry we’re $18.57 above average. However, we know that our products, at a higher price point than traditional eCommerce, still have a positive return. Since the campaigns are still very profitable at a $63.84 CPA, this metric isn’t super concerning. That said, one way to get this down would be to consider offering a promotion or deal with our retargeting efforts on display. This won’t lower the Search CPA, but it should help increase post-view conversions from Search.  

B2B

Here’s another example from one of our B2B clients. This company is relatively new to the market but growing fast in the small business bookkeeping and accounting space. We manage their paid advertising for both Facebook and Adwords, allocating 20k per month across both channels.

Here’s how our team tackled the assessment:

CTR: Nice! We’re up significantly here. This could mean that our positioning is relevant and unique to our competition in the space. While we didn’t make any adjustments to the ads in this account, we did pull the top performing ads for the entire marketing team so that we could leverage that positioning in other channels such as email, Facebook, Instagram, and landing pages.

CPC: We’re spending 3x more than the industry average on clicks, so it was important to dig in here. The first thing we did was look at our keyword position and the required minimum bid to stay on the first page of results. The keywords in this industry are expensive and in order to stay in the top 3 positions, not the first but an average of 2, we had to bid pretty high. The account quality score is high, so we know that spend is one of the best ways to keep us on page 1. One of the tools we use to see keyword bid trends is Google’s Keyword Planner. We use this before we launch campaigns and during optimization so we know an estimate on what things will cost.

CVR: Wow! Big high five to our client on creating high-converting landing pages. While there were no direct actions to take on this one, we did analyze which campaigns had the highest and lowest conversion rates. For any campaigns that we’re budget capped and converting at a high-rate, we increased budget.

CTA: Over by $5 and working to bring this down. Since this is an average and the account has 31 search campaigns, can we identify any campaigns that are 2x over the CPA average? If so, how do we bring them down? This benchmark was helpful in understanding which campaigns we need to focus on the most to see the most significant change in results.

Key takeaways:

  • Use the data to understand your account metrics but not to shut things down immediately if you don’t hit it out of the park on your first swing. As you can see from our eCommerce example, things look pretty red. The benchmark report gives you a chance to identify focus areas and improve.
  • Understand where you fall on the industry paid advertising spectrum. These benchmarks are averages, and it’s important to know where you fall on the spectrum. In our eCommerce example, the average product price is $10,000. This account sees very different results than a lower price product account.
  • Benchmarks give you a place to focus but aren’t the only indicator of success or failure. We always go back to one key metric: ROI. When you understand which campaigns and channels are actually generating revenue, you’ll know where you’re making or losing money and how to move forward.

Over to you! 

We’re excited to share our strategies, open up conversations on PPC and learn all together. What benchmarking strategies do you lean on when looking to evaluate results?

If you’re short on capacity, you can get some of the benefit of benchmarking with significantly less effort by contacting Tuff for a free growth strategy session. We’ll analyze your paid advertising and present your top growth opportunities in a PDF.

We’d love to work with you.

Schedule a call with our team and we’ll analyze your marketing, product, metrics, and business. Then, present a Growth Plan with actionable strategies to find and keep more engaged customers.