Digital marketing agencies are in the unenviable position of setting realistic expectations when it comes to paid advertising. Marketing dollars are precious, and campaigns don’t always go as planned. It’s a complicated business. Worse, there’s no shortage of agencies out there that overpromise and underdeliver.
When things don’t go our way it’s easy to get frustrated and give up. Understanding a few key things about paid campaigns can give you a better grasp on what to expect and boost your confidence next time you’re working with an agency on a paid advertising campaign. Here they are.
The Cost of PPC Campaigns Vary by Industry
All industries are not created equal when it comes to ad costs. PPC keywords are most expensive for industries that manage or deal with huge sums of money—think insurance and money lending. Here are the top 10 most expensive keywords, according to one analysis:
| 1. Insurance | 6. Lawyer |
| 2. Loans | 7. Donate |
| 3. Mortgage | 8. Degree |
| 4. Attorney | 9. Hosting |
| 5. Credit | 10. Claim |
Click-through-rate (CTR), cost-per-click (CPC), and conversion rate can vary dramatically by industry, too. Another analysis found:
- Triple the CTR for the dating/personals industry (6.05%) versus technology (2.09%).
- A huge difference between cost-per-click for e-commerce ($1.16) versus legal ($6.75).
- A dramatic difference in conversion rates by industry, ranging from 1.96% for advocacy groups to 9.64% for dating/personals (all numbers are for search network ads).
If you’re in an industry that pays top dollar for PPC keywords, you need to be even more diligent about following PPC best practices like building out negative keywords and using A/B testing for ad creatives and landing pages.
Larger Budgets Mean Faster Optimizations
In order to optimize ad budgets, you need a certain amount of usable performance data. And with very small budgets it can take longer to collect the data needed to effectively optimize PPC campaigns.
If you’re getting “limited by budget” notifications from Google, it’s important to investigate why you’re running up against budget constraints. Again, keywords for big money industries can be super expensive, eating up your entire daily budget after just a handful of clicks. If they’re leading to conversations, great. If not, you might want to nix some of them or create separate campaigns for high-ticket keywords versus less expensive (but not necessarily less valuable) ones.
You Don’t Need All Kinds of Advertising All the Time
Which type of campaign is right at any given time depends on several factors, including the product or service you offer, your buyer journey, etc. In the realm of paid advertising, both search network ads and display network ads are effective, but they’re different.
- Search network ads are text-based ads that appear next to the search results when you search for products or services. They’re best for capturing intent (e.g., “Los Angeles electrician”). To effectively use search network ads, you need to know the intent behind the terms people use to search.
- Display network ads are those that appear on the Google Display Network, a conglomerate of third-party websites that have agreed to show Google ads. The Display Network is made up of millions of websites, which collectively reach 90% of internet users. Display ads can appear not only on websites, but also in apps, in Gmail inboxes, on YouTube videos, and in banners. They’re best for building brand awareness, not meeting an immediate need.
- The Search Network with Display Select is a combination search and display network campaign. It’s no longer possible to create a combo search and display network campaign on your own, so you must select Search Network with Display Select in Google Ads to pursue this strategy. The good news is that Google recently made improvements with a more selective algorithm, which they claim yields better results.
Clicks Do Not Equal Conversions
Many an agency has boasted about X number of conversions when they really meant X number of ad clicks. The two are not the same. An ad acts as a link to a website or landing page—but clicking an ad link is not a conversion. A conversion happens on the page, whether it’s downloading an eBook, subscribing to a newsletter, or buying a product.
If you’re getting lots of clicks but few or no conversions, some tweaking is in order. Maybe you need to learn more about your target audience (creating buyer personas is a good start). Or you might need to reevaluate your keywords. Or build a more well-defined conversion funnel.
Bottom line: Clicks are great, and it takes a certain number of them to generate conversions. But if your conversions are stagnant or shrinking, it’s time for action.
Reasonable Expectations Are a Must
PPC is often presumed to be the most expensive of all the marketing tactics. You’re paying for every click, true. But you can measure the effectiveness of your PPC spend relatively easily. Measuring the effectiveness of SEO, email marketing, and social media efforts, on the other hand, is trickier—the costs are harder to calculate. That’s because SEO is a long-term process that requires ongoing effort.
No agency can guarantee the number of conversions or leads you’ll get on the outset of a paid ad campaign. As a campaign matures, projections can become more realistic. But any agency that promises a certain return or number of leads for a fixed rate is not being honest. A reputable PPC marketing agency will set realistic goals and expectations but make no guarantees.
Get Help from the Pros
Overwhelmed at the prospect of launching and managing a successful PPC campaign? The pros at National Positions can help.
Our PPC analysts and digital marketing specialists offer a lean, data-centric approach toward paid search advertising. We focus on the data that matters, and we monitor your campaign with the attention you deserve. It’s why we’ve been so successful building targeted campaigns that optimize profitability for our clients.
We have the expertise and industry-leading tools to help you create a profitable paid search campaign. Call us today at (877) 866-6699 for help with PPC, SEO, and much more.