Google dominates online advertising, mainly because its ads are so effective. Nothing else compares to Google because no other ad platform has users who are in the same state of mind. When consumers search, they are already primed for action: to visit a website, to buy a product or to pay for services. Social media and display ads can’t compare, simply because ads on these platforms are an interruption to users. Alternative search engines can’t get close to Google because they have just a fraction of the traffic.
Surprisingly though, many companies – both large and small – have never tried to run their own Google ad campaigns in-house. Delving into online ad campaigns can be a daunting business, but there’s no need to worry. With a tiny budget, a little bit of marketing knowledge and a solid plan, anyone can set up risk-free always-on Google campaigns that generate a profit. Although it takes some time and effort to set up, once a campaign is in place and making money, it largely looks after itself.
This doesn’t mean you can just set up your Google ad campaign and ignore it. Tracking, monitoring, and optimization are vital to any successful campaign and having the right system in place is vital. Not only to track your Google ads, but also to compare it with your other digital campaigns and ensure your investment is paying off.
If you’re a brand manager and you want to prove that Google ads are worth investing in, this article will take you through the vital things that you need to get a test up and running – although this isn’t a step-by-step guide to setting up ads on the Google platform. There are plenty of great guides out there that can teach you how to do this (which we’ll share in this article) but we want to give you something you can’t find elsewhere: a master plan that will help you prove that Google ads can be profitable for your business.
The first thing you need is a destination: a place where people who click on your ads can buy your products or services, or somewhere where traffic will make your company money. Preferably this should be a website or app that you own so that Google tracking can be added, but even if you only currently sell products on a third-party e-commerce site like Amazon, you can land traffic on your site first before sending them on to make a purchase (known as a landing page).
If you manufacture physical products and they aren’t available online yet, then this is your biggest hurdle. Luckily Amazon is here to help. There are countless guides out there that will help you do this, including Amazon’s own. The great thing about Amazon is that they take care of the fulfillment headache and you can pay-as-you-go, so there really is no excuse for not taking this step. Obviously, this is a much bigger company decision but something that many successful global brands are doing (see the Samsung, Levi’s and Coca-Cola Amazon stores).
The biggest factor between success or failure with a search campaign is not the Google ad campaign itself, but the customer journey after a potential customer clicks on your ad. If you’ve already got a streamlined sales platform in place with a great conversion rate, then Google ads will accelerate your sales. But if you are getting visitors and nobody is buying anything, a Google ad campaign won’t solve these problems. Go and fix those issues first by working on your customer journey, your brand, your pricing structure, and your lead offers before investing in any ads. Otherwise, you’ll only be throwing money away.
It’s difficult to plan a proper search campaign if you don’t know what a visitor to your destination is worth. A simple way to calculate this is to divide the monthly profit generated by the number of monthly visitors – so if you made US$12k profit from 850 visitors in a month, a click is worth $14.12. If you genuinely have no idea at this stage because you don’t have access to the data, then running this kind of test campaign can give you the data required to work this out.
You might also have an offline activation that makes your company money, such as a free consultation appointment. If you know that for every 100 visits to your online booking form, 20 appointments are booked 10 people show up and spend a certain amount of money, you can also work out what a click is worth (just make sure you divide by the number of visitors to the form and not by the number of appointments booked). Of course, you can just shoot as low as possible, but a solid number means less risk that you’ll lose money. The higher the value that a click is worth to you, the easier it will be to make this a success. If you sell low price high volume products, then Google ads probably aren’t for you, but you can check with these simple calculations.
The best you’re likely to be able to pay for Google clicks when your campaign is finely tuned is around US$0.10–$0.15. As an example, let’s say you sell wireless Bluetooth headphones on your website and your profit margin is 50%. For every 100 visitors to your website, you make five sales with an average spend of $40, which gives you $20 profit per customer. So for every 100 visitors to your site, you make $100 profit – $20 x 5 customers is $100. $100 divided by 100 visitors is $1, so each visitor is worth $1 profit to you ($2 revenue per customer). If you’re happy to accept a final profit margin of 25% after your ad budget is included, you have 25% remaining, or $0.50 to spend on clicks.
So $0.50 is your target CPC. Buy clicks at $1.01 and you are making a loss, at $1 you are breaking even, anything below that counts as a return on investment, but $0.50 or below is your target.
Your first port of call should be Google’s keyword planner. You can access it with any Google login. It allows you to search for keywords and find out what you should expect to pay for a click, how often that word is searched for and how competitive the bidding is for that keyword. What you are looking for are keywords with a high volume of monthly searches, low bidding competition, and the lowest bid range.
If I search for “wireless headphones” in the United States, these are the results:
For example, “wireless headphones” costs between $0.58 and $9.01 per click. At this stage though, we are just trying to see whether clicks are available around or below our target CPC of $0.50. Don’t concern yourself too much with the higher figure because you can set your own CPC limit that you will never pay more than for a click. For the moment we just want to make sure there are clicks available within our price range. You also need to consider the fact that the quoted cost here is to be top of the page (which means your ad will be the first result). If it costs $0.50 to be top of the page, then it’s possible that other ads are available to further down the page, on the second page of results or at off-peak times for $0.10-$0.40. This is what we are interested in. If the low range figures were showing up as $2 and up, then it would be best to look at some different search terms.
At an average CPC of $0.20, you could bring around 50 visitors each day to your site for $10. Continuing with the example above, five sales per 100 visitors would give us an average 2.5 sales per day. Small numbers, but enough to prove that a return on investment is possible and decide whether to invest a bigger budget.
It’s not always going to be possible for $10 a day, but it should be doable for most companies in most locations. If you’re a US brand in a competitive market, advertising at peak times and bidding for popular keywords, then you might struggle to get a single click for $10, but you just need to be a bit more creative. Think of something your business offers that is unique, or run your ads in the middle of the night when competition for bids is lower. For example, if your USP is comfort, the keywords “most comfortable wireless earbuds” are available for $0.21.
At this point, with a few rough calculations, you should now be able to make a call on whether, in theory, this is going to be profitable for your business.
This is a simple test campaign with a very straightforward objective so you want to make sure that the people working on it know exactly what you’re trying to achieve: spend as little money as possible to prove that there are customers out there using Google every day to search for and buy products like yours who can be converted at a cost-effective CPC. You have some tight parameters to work with and you have identified search terms and a USP to focus on. Getting this all down in a really tight brief will definitely save you time and money down the line.
Once you’ve got the brief sorted, you’re going to need some help. By having these four things ready, the person you ask to do this is already going to have some of their headaches solved (media people hate it when a brand comes to them without the first clue about budgets and targets).
If money is very tight, then this probably has to be someone within your company. That shouldn’t be a problem though as none of this is particularly difficult. It’s the perfect project to give someone when they have regular downtime. It is time-consuming, and there’s a lot to learn, but there’s a huge reward at the end if you get it right. Small businesses without any marketing skills set up successful Google ad campaigns every day. With the right management, you could even get an intern to do it. There are some fantastic in-depth guides out there (like this one by Neil Patel) that you can give to an intern or read through yourself if you want a better understanding of how it all works. The more you know the better.
You could also get a specialist to help you. This kind of project is perfect for outsourcing and, depending on what your employees are paid, it might even work out cheaper. It will certainly be quicker and have a better chance of succeeding. There are highly skilled Google ads specialists available for $40 per hour available on platforms like Upwork.com. If you can get all the assets needed for the project created in-house, a specialist could easily put this kind of small test together for a few day’s works. It might take a day or two to set up and then another day spread across three or four weeks to optimize. (If you’re worried about overseeing a remote worker, see point 6 below.)
The other option is an agency. You might think that no agency will be willing to run such a small test (you’d be right if you have a big agency in mind) but there are many talented local ad agencies who would be more than willing to spend a little time on this. You might even be able to get them to do it for free if there’s a carrot of running a bigger campaign if the test is a success.
One of the most common mistakes people tend to make when it comes to their analytics is not tracking their results. But it is highly important, as your product grows, evolves, expands, basically, it acquires more users, to have the ability to dig right into your data in order to be able to actually learn something about your product or service and it also helps you with the developing of your product. Keeping an eye on the most important metrics will help you see how trends change over time or how your users behave – the customer journey can be different from one user to another and tracking your data will help you see and understand the differences. Analyzing your metrics will also help you with the understanding of user engagement and it will help you in the big scheme of making the best product decisions or marketing decisions.
So, no matter which option you choose, setting up yourself the Google ads or making use of an agency’s help for it, the Sether platform is there to make it easy for you to manage the process. It can even help you to monitor and track the performance of your internal team and their targets. Sether is designed to help brand managers monitor their agencies, but it works equally as well if you treat your internal staff or external consultants as if they were an agency. Sether’s tools help you to track their performance and keep a close eye on your campaigns.
To see how easy this is, take a look at this video that shows how to set up a campaign:
Or, if you need some help talk to us at Sether and we can help you get started with our platform and set up your Google test campaign.
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