Pay-Per-Click Advertising: Everything to Know About PPC

If you’re already doing email marketing and SEO optimization, then you’ve nailed down two of the most fundamental internet marketing strategies every small business should know. But these two strategies alone are not enough to comprise a viable marketing initiative.

For one thing, email marketing requires you to maintain an address list. Once you have that list and use it, you’re marketing to the same customers with each email. If you aren’t regularly adding new names to your list, then your email strategy will eventually fold from natural attrition. And SEO, while essential, is far from enough. Since 2014, Google and other search engines have been returning paid results alongside free ones. Since paid results provide a wide revenue stream to the companies behind internet searches, you can expect to see pride of place going to those paid options more and more while organic results get shuffled to the side.

As a business owner, once you have the budget to expand your marketing a little bit, you should begin to experiment with paid search. Paid search marketing can take several forms, but all of them work on a pay-per-click model of advertising. Using this model, you set up an ad on a platform or a search engine and pay a fee each time a reader clicks on the ad. In 2019, advertisers spent $136 billion on paid advertising. Some of that money brought back enormous revenue, and some never even returned to the advertisers’ pocket.

How can you know if PPC is right for your business? How much money should you invest in this strategy? What are the potential benefits and pitfalls of PPC for a small business? We cover these questions and more in this all-in-one guide to PPC advertising.

How Pay-Per-Click (PPC) Advertising Works

Advertisers can select from several PPC models, but they all have one thing in common — the advertiser pays to direct search traffic toward their website. Whereas organic search marketing attempts to get your website ranked at the top of the SERP (Search Engine Results Page), PPC advertising pays for a spot on the SERP.

Like organic search marketing, however, PPC advertising requires a thoughtful campaign strategy. You have to research relevant keywords, organize those keywords into ad groups, and build landing pages optimized for conversions. Typically, you will split your ad campaign into two groups in order to perform an A/B test and thereby determine which keywords or which images are most effective for your business. PPC is not easy, but it is effective. 64.6% of consumers click on Google ads when shopping online. They can’t click on your ad if it isn’t there.

The Benefits of PPC Advertising for a Small Business

Paid search advertising is not the same as interruption advertising such as banners, commercials, or billboards. In interruption advertising, the company simply puts the message in front of an audience, crosses its fingers, and hopes for the best. With paid search, however, you are using the intelligence of the internet to help you put the right ad in front of the right audience in the right place and at the right time to engage likely buyers.

In this way, PPC offers fast, measurable results. Unlike organic marketing strategies, which can take many months to pay off, PPC starts showing its returns right away. You don’t have to wait for Google to find you and rank you based on its complex, ever-changing algorithm. Plus, when relying on organic strategies, it can be a challenge to know exactly what keywords you are ranking for, what messages resonate with your audience, and what images grab attention. But a PPC test can let you know what’s working within just a few days, improving your data and your marketing approach.

The Pitfalls of PPC Advertising for a Small Business

PPC is one of the few forms of internet marketing that costs money, and an ad can quickly run up expensive clicks without returning the goods, so you want to be careful. Doing PPC advertising well takes time and skill. PPC is not a set-it-and-forget-it strategy. You have to keep reviewing the data from your campaigns, tweaking your existing ads based on that data, and then creating new messages and advertising experiences for your audience. Just putting out a paid ad or two and hoping for the best is a quick way to lose money.

Working with PPC ads also requires specific skills and knowledge. To do PPC well, you have to understand geo-targeting, tracking, quality scores, testing, keyword research, and remarketing. Knowledge of video creation and advertising may also be helpful as more and more of your competitors’ ads are likely incorporating audio and visual elements. You also need sharp math skills to stay on top of your numbers. Too many clicks and not enough purchasers will put you in the hole very, very quickly.

Should You Hire a Firm to Manage Your PPC Advertising?

Given that PPC advertising requires so much time and skill, should you hire a marketing company to handle this strategy for you? Unless you have a qualified PPC professional on your team, then yes, you should hire it done. If you intend to invest money in an advertising strategy, you need an expert to ensure you get a good ROI. If you don’t have the money to hire a firm — or a qualified freelance marketer — to handle your PPC activities, then you probably aren’t ready to get into PPC advertising just yet. Wait until you do have the budget instead of launching too early and losing money.

If you’re ready to hire a PPC marketing agency, though, what should you look for? First, consider credibility. Check their company reviews on Google, ask for referrals, and read their case studies. Ask for their client retention rate. Make sure the firm can do what you need done, and don’t saddle yourself with a group of “fast learners.”

Then, ask about their data tracking and analytics. Do they track search terms as well as keyword performance? What about click-through rates, conversion rates, or customers? Will you see a monthly analytics report that you can make sense of without resorting to the Rosetta Stone to help break the code?

Finally, make sure your prospective agency will keep you informed on budget vs. actual and let you know anytime the numbers look askew. If your PPC campaign is turning from a gold mine into a bottomless money pit, you need to know sooner rather than later so you and your team can correct your course.

Calculating Your PPC Budget

PPC can be a cost-effective method of customer acquisition or the most expensive internet marketing debacle you’ll ever spend money on. So it’s important to get your budget right before you ever launch your first campaign.

How much should you spend on PPC? It depends on your goal. Start your campaign with a SMART goal — Specific, Measurable, Aggressive, Realistic, and Timely. Once you know what you expect your campaign to accomplish by when, you’ll have a better idea of how much money to invest in it and whether your investment is getting the results you want. You can rely on a couple of rules of thumb, however, for budgeting.

The standard equation in the internet marketing industry is, Target traffic = goal / conversion rate. If you expect to acquire 100 new customers and your average conversion rate is 2.2%, you would calculate it as follows: 100 * 100 / 2.2 = 2200 visitors. Next, you need to know the approximate cost of the keywords you will bid on. Most keywords run between $0.35 and $1.80. If we assume that your keywords will cost $1.25, then you’ll need to multiply $1.25 by your 2200 visitors. In that case, your campaign will cost $2,750.

Remember, though, that’s just the cost of the ad. It doesn’t take into account the time you or your firm will spend doing keyword research, hunting down the right images, writing the copy, designing the ad, or tracking the results. If we had to pick a number for you to put in your budget for PPC advertising, we’d say count on spending $10,000 a month for your first year.

How to Set Up Your PPC Campaigns

Every effective PPC campaign starts with research. Craft your buyer personas, and let those to determine your keyword list. Then use tools such as Google AdWords Keyword Planner to validate those keywords and quantify the demand for them. Structure and organize your keywords using brand terms, generic terms, and related terms. Be sure to include negative keywords to exclude searchers who do not have a high buying intent for your product or service. Figure out which keywords you can afford.

Now that you know what you can do, see what your competitors are doing. Tools like SpyFu and Adwords can help. Once you know what you can do and what your competitors are doing, it’s time to do something yourself. Start by writing a great ad. Personalize it. Give it a killer headline. Deliver your unique selling proposition (USP) in the copy. Finish up the copy with a call to action. Now, improve your piece by adding an extension such as a call button or a renew option.

Who Should Do PPC on Google?

Everyone who plans to do PPC should go with Google.

When you think of PPC, the first place your brain probably goes is to the massive search engine that created paid search in the first place. It’s the giant in the PPC world, and there’s a good reason for that. According to Hubspot, Google ads gets 246 million unique visitors, 3.5 billion daily interactions, and an estimated 700% return on investment.

Google is not the only place to do PPC advertising, however. Amazon and Facebook are also major players in the PPC space. If you don’t sell your product on Amazon, though, there’s no reason to buy ad space there since it will not take you off the platform. As far as the question of Google vs. Facebook, more people regularly use Google than go on Facebook. So Google is the logical place to start your PPC strategy, but that doesn’t mean limit yourself to Google.

Who Should Do PPC on Amazon?

If you sell your product on Amazon, PPC can help you snag the most prominent spots on the SERP. Like Google, Amazon lists sponsored ads and images at the top of the page. The company offers advertisers three formats: Sponsored Products, Sponsored Brands, and Product Display Ads. Sponsored Products promotes individual products. Product Display ads point viewers directly to product detail pages. And Sponsored Brands lets the advertiser create a headline, promote their brand, and feature three products in an ad that links to a custom landing page on Amazon.

Who Should Do PPC on Facebook?

Facebook ads get a conversion rate of 9.21% across all industries, making Facebook a lucrative spot for paid search when you know for sure your audience is on that platform.

In general, be sure your free strategy is up and running on Facebook, you’ve learned what works, you’ve documented your data, and you know how to maximize free social media for profit before you spend a dime on paid ads. Remember, too, that advertising decays with time, so you’ll need to keep your Facebook ads fresh. If you don’t have the time or money to invest in creating, tracking, and refreshing ads on Facebook, it’s best to stick with the free features on the site.

7 Tips for Getting the Highest ROI Out of Your PPC Investment

1. Use exact keyword matches.

2. Don’t forget negative keywords.

3. Target your campaigns to your audience.

4. Set up a landing page specifically for your ads.

5. Personalize everything.

6. Track everything.

7. Test, iterate, and try again. Great results take time.

PPC can form an effective component of a digital marketing strategy for your small business. Make sure you have the time, money, and expertise (or can hire it) to do it right, and you should see your ads pay off handsomely in both new clients and increased revenue.

Check out all of the articles in the ‘Marketing Strategies Every Business Should Be Using‘ series:

• How Any Size Business Can Have Amazing SEO
• Which Social Media Platforms Are Right for Your Business?
• Pay-Per-Click Advertising: Everything to Know About PPC
• Gain Free Business Exposure by Becoming a Podcast Guest
• How to Become a Trusted Expert with Content Marketing
• Get More Business Referrals by Encouraging Word of Mouth