If you're new to the world of paid online advertising, it can be a little overwhelming at first. Even though it's an essential component of a business' internet presence, it's not as intuitive as other marketing channels.
After you've finally learned what all of the jargon and acronyms mean, you still have to figure out how to get the best value for your money. Where do you even start?
It can be hard to know how to set your Google Adwords budget. Luckily, there aren't as many variables as you might guess at first.
We've put together a guide to help you get started. Read on for 7 tips for calculating your Google Adwords budget.
1. Use Your Existing Marketing Data
Before you start looking at keywords, before you assign dollar signs to anything, you should review the marketing data that you already have.
Where and how is your business currently marketing itself? Are you leaning heavily on social media marketing? Does your website enjoy a lot of organic traffic? What about your marketing efforts off-line?
The answers to all of these questions will help you figure out how you should set and spend your Adwords budget. Look at what is and isn't working for you already, then figure out how you want Adwords to fit into your existing campaign.
Are you relying on it for most of your traffic, or is it another way to capture leads?
2. Learn Your CPC
Once you've taken a look at your current marketing efforts, then you can start looking at the cost per click of each keyword, or CPC. This is how much it will cost you each time someone clicks on your ad.
Think about what keywords you think you might want to bid on, then research what their average CPC is. You don't have to have your keywords set in stone yet, but it's a good way to get a rough number in your mind of what you might have to spend down the line.
You can do this with the Adwords Keyword Planner. Make sure to adjust it by factors like industry and location to get the results that are most accurate to you.
We'll come back to keywords again later.
3. Determine Your Top KPI
A KPI is a key performance indicator. It lets you know how well your business is doing in certain areas. Think of it as a goal or target you want to hit.
You can have more than one KPI, but you should determine which ones are most important to you.
For many businesses, the CPA is most important. This is the cost per acquisition, or how much money it cost you to convert one lead into a paying customer. If it seems like it's costing you too much money to find new customers, that's a sign that you might want to revisit your Adwords strategy.
4. Know What Your Competitors Are Spending
It's always a good idea to know what your competitors are doing, especially if you notice that they already have ads in place for certain keywords. You don't want them to win the business you're spending so much time working to earn.
Of course, you can't exactly just shoot over an email to ask what their Adwords budget line is. However, you can use Adwords to get an idea of how much they might be spending. Even this hypothetical information can be valuable to you.
The Adwords Keyword Planner can help you with this, or you can check out the Auction Insights instead. You can see how often a competitor's ad was shown instead of yours, when it was above yours in the search engine, and other really useful data.
You'll also learn who your competitors actually are -- they might be different than you expect.
5. Choose Your Keywords Wisely
Let's say that a personal injury attorney in Dallas wants to advertise on expensive keywords like "lawyer" or "attorney." Those keywords have a high search volume, so he thinks a lot of people will see and click on his ad. Unfortunately, those keywords won't do our hypothetical attorney any good.
People don't necessarily search for "lawyer" with any urgency. Maybe it's a kid working on a school project about what lawyers do, or an adult who wants to read the Wikipedia entry. The keywords are too generic and won't drive any leads to his website.
Someone searching for "personal injury attorney Dallas," on the other hand, probably knows exactly what they want, and is far more likely to click on his ad if it appears at the top of the search results.
You do want high traffic keywords, but they also need to indicate commercial intent. If that keyword also has low competition, you know you've really struck gold.
6. Don't Forget Branded Keywords
What if you have a really robust marketing strategy offline and you know people will be searching specifically for your business? Have you built up enough recognition where people would search for you?
In that case, you'll definitely want to make sure you have money for branded keywords. If your website already shows up at the top of the search results, that's great! It means you're doing something right.
However, there's a lot of potential advertising space above that listing that could go to your competitors if you don't buy it.
Your branded terms will be cheaper for you to bid on, so make sure you set aside some money for that.
7. Keep Checking Your Google Adwords Budget
So you've followed all of the steps, you've created a budget that works for you, and allowed Adwords to automatically bid for you on keywords. You're done, right?
It might seem like all the hard work is already done, but you should continuously monitor your Adwords budget -- and not just to find out when you've hit your daily spending limit. After your account has been active for awhile, you'll get more data about which keywords are doing well for you and which ones aren't worth the money.
Monitoring this regularly and adjusting your budget accordingly will help you get the most for your money.
Get Your Money's Worth
PPC advertising is one of the best ways to quickly draw customers to your website. With these tips, you'll be ready to get as much as possible from your Google Adwords budget.
Want to work with a professional instead? We've got you covered. Falcon Digital Marketing will work with you to create a PPC campaign that will bring positive results to your business. Find out how.