Many sites want nothing more than to be seen across the vastness of the Internet. However, with so many other websites competing against one another, getting noticed in your respective niche isn’t easy. Fortunately, there are certain methods on gaining that much needed visibility that you want. PPC or pay-per-click ads can be seen as a shortcut to getting your site bumped up in the search results.
Several services like Google, Bing and Facebook now offer PPC ads to individuals and businesses to get better listings in their search results. PPC ads get their own space alongside more organic search results in the top pages. The cost of these ads varies with anything from a few cents per click to something like $10 and above for more competitive keywords or niches.
However, this begs the question: are PPC ads worth it? Will you be able to make back all the money that you are pouring into these ads?
Admittedly, PPC is not some magic pill that you can simply take to make your business take off. Just like any other marketing practice, its results can vary based on various factors like competition, industry, pricing and ad efficiency.
A quick and dirty way to determine if you’re really getting your money’s worth is to compute your monthly spending by checking if your cost per click is less than what you’re spending and compare it against your profits.
A simple formula to check for profitability would look something like this:
Conversion rate x Total clicks per month x Profit per conversion
So if you get a conversion rate of around 1% in a given month with 200 total clicks and around $5 dollars in profit per conversion, you may want to reevaluate your campaign or drop it altogether.
This is one of the biggest deciding factors that you should consider when running a PPC campaign. Your ROI (return on investment) should dictate not only your budget, but also your strategy. Depending on which keywords that your campaign is targeting, you can properly allocate your budget across a given amount of time and then drive your marketing efforts towards the right direction.
However, if you notice that your conversions aren’t stacking up to the amount that you’re paying for with PPC, then you might want to reconsider your strategy. You can either retarget your keywords and content as appropriate, or scale back on your budget. In the end, if the ad spending doesn’t bring you that much needed return on investment, then you’ll need to take a step back and reassess things.
Once you’ve set up a decent sampling of how your campaign has panned out (a month’s worth of should be a good sample), then you can decide which way your PPC campaign should go from there. There isn’t a hard and fast rule of how much profitability you should have with PPC, but you need to be the one to establish the correct metrics for your campaign to answer the question of: “Is it worth it?”