Whether you’re a PPC expert or a PPC amateur, setting the right budget for your campaign is critical. You need to take different factors into consideration, which can be challenging - especially in a service-oriented business. But, with the right PPC budget, you really could scale your campaign and help your company grow. The answer in how much you should actually spend is varied, but we’ve listed some key considerations that you should think of when taking that first step in creating your PPC campaign.
1. Goals, Goals, & More Goals
For starters, you need to understand what you want out of your campaign. This means defining your customer’s click; is it driving sales, or driving engagement? Using different keywords, the right way (which we’ll discuss what the right way means later on) can allow your business to target users in different stages of the buying cycle. For a service-oriented business, it’s crucial to have a clear understanding of the value of each conversion to your business.
2. Cost Analysis
Step #2, start thinking about how much you can actually afford to spend on your campaign. How do you it? Start off by calculating how much you would be willing to pay for a sale, then go from there. Simple.
Note-to-self; you always want to aim for a campaign that produces a conversion rate of 1-5%. To work out the costs, you can use tools such as Google Keyword Planner, which can help you decide whether or not you are targeting cost-effective keywords, how much it’s likely to cost, and how competitive it is. That’s the right way mentioned above. Treat Google Keyword Planner as your best friend - and you’re likely to get a good grasp on the effectiveness of your campaign before you even start it.
3. Target Your Location
An essential component in establishing the right budget is knowing how far you want your ads to reach. The size of the geographic target market you are trying to achieve will determine the size of the budget required. Obviously, if you’re trying to go national, you’ll need to invest more in your campaign. If you’re targeting a small city or two, you can look at a smaller budget since your potential audience is smaller.
4. Checking Reports & Analyzing Them
One of the most important things you need to keep in mind is to continuously check and keep track of your reports to ensure your conversion goals are accurate. You want to give yourself a peace of mind, so you need to make sure your budget is being spent on the right keywords. If your goals are not being reported accurately, you won’t even be able to review your campaigns (a super costly mistake!). If you focus your budget solely on the keywords that are delivering a solid ROI through your handy dandy Keyword Planner Tool, you can scale your campaigns with confidence and grow your business. By checking your reports, you can review all your current keywords that are costing you money and remove them, which leaves you with a sufficient amount of information on what’s working and what’s not.
Consistency is key; you want to make sure your goals are driving the most traffic to ensure your campaign is using your budget properly.
5. Initial Budget
The last thing you want to do is blow through your budget too quick. If that happens, you won’t be able to implement the necessary changes to see whether or not PPC is what your business needs. During your cost analysis in step #2, it’s important to have a fundamental understanding of what good and bad scenarios look like, from a budget standpoint that is.
You gotta do it; set a budget aside to sustain poor performing results for the short term (some of your keywords will have to take one for the team - that’s reality). If you have a big budget and can plan ahead, then you must plan a budget of the amount you can actually afford to spend over a 4-6 month period to make sure you have enough time to rescue a miserably failing campaign. If you use your initial budget as a starting point and make the right adjustments on a regular basis (depending on the performance of your campaign), you’ll be good to go.
Setting the right budget for your campaign is critical; it can make or break your campaign. But there is a light - follow our 5 tips listed above, and you’re already taking the right steps towards maximizing the value of each and every conversion to your business.
Need help with your PPC strategy? Contact us today to learn more about creating a strategic, custom PPC plan to drive qualified traffic to your business website.