Pay per click (ppc) budgeting

Pay per click advertising, (the ads that appear at the side of your search results) has really taken off in Ireland.  The internet is still a relatively fresh market place in Ireland.  Indeed some businesses still do not have a website today.  With all new technologies it can be difficult to ascertain what is reasonable budgeting.  What will give a ROI and what will drain the budget resources?

PPC advertising was gaining momentum in Ireland.  However, with the onset of the recession, we saw spends decreasing.  How do we know that spends were decreasing radically?  The bid prices fell dramatically.  So too did adsense revenues.

What is the difference between Google Adwords and Google Adsense?  If you are an advertiser then you are using Adwords.  If you display google ads on your site (like the ones on this site) then you are using adsense.  Every time one of you clicks on an ad on this site I get a few cents.  Pre recession, the revenue from these adsense ads was much higher.

All of this points to a lowered pay per click (ppc) spend.  Interestingly though some companies actually chose to increase their adwords budget.  With reduced competition and lowered costs it made / makes sense.

How much should you budget for with Adwords advertising?

The easiest way to find out is to set a budget that you are comfortable with and then see how far that gets you.  It really depends on how much competition there is for the keywords you are targeting.  The higher the competition, the higher your bid will have to be.  This can sometimes be ludicrously high.  If you are paying $5 – $8 per click then you are wasting a lot of money in my opinion.  I don’t like to ever spend more than $2 per click.  In fact, I am more comfortable around the 50 cents mark.  There are other factors to figure out too, before you spend a fortune on adwords.

How many click throughs are converting to sales?

Your Website really needs to be set up to make money out of visitors you are actually paying for.  If you are getting clicks from your adwords campaign, but are not seeing a boost in revenue then you are doing something wrong.  The landing page needs a call to action.  If it is a single product, give them a big buy button. If it is a shopping site of some kind then get them to register.  If you can get an email address you can give occasional reminders about your site.  Most people visit a site up to 5 times before making a purchase.  Your websites greatest focus should be on converting visitors to sales.  This is true of services too.  If you do not interact with your visitors they will go elsewhere.

Some of you will be thinking that there is no call to action on this site, so what am I talking about?  There is the RSS feed, which is gaining more subscribers every day.  There are also links to my main site sprinkled throughout the blog.  I link from relevant topics to relevant pages on the main site.  In this instance, because the post is about Search Engine Marketing or SEM which is the umbrella term for PPC and related advertising, you will see links like the previous one on PPC.  This helps my SEO and leads to more relevant information.

So, in short, if your conversion rates are low, then you are spending unnecessarily.

Why pay for a professional to do my Adwords advertising for me?

The short answer is that professionals have more experience with Adwords and can actually save you money on your advertising campaign.  Of course you can learn it yourself, but that is taking focus away from the core of your business and it will take you time and money to learn.

You will always retain control over our own Pay Per Click budget in either case.  Online marketing budgets need not only take PPC ads into consideration.  I’ll be discussing Online Marketing budgets further in the next post.

About Ian Wortley

Ian is one of Irelands leading SEO consultants with over 8 years experience in the Irish market. Ian discovered his love of all things internet related in 2005 and has been living nearly exclusively online since then, causing much worry to friends and family, but getting great results for clients. Contact Ian: Phone: 01 6854806 Mobile: 086 3817149

3 thoughts on “Pay per click (ppc) budgeting

  1. Ppc isn’t for the uninitiated. I wasted plenty of money on adwords as I had no idea what I was doing on the subject of key phrases and bidding. I burned through $50 voucher in a day or two. Anyway – nice site I will bookmark and come back. Thanks

  2. Interesting url given the comment! But what you wrote seems to be an experience echoed around the world. PPC budgeting is not rocket science, but it’s very easy to spend way more than you need to.

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