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Relationships are hard. And your company’s relationship with PPC is no different.
You and your marketing team may give PPC your best shot — but still not get the results you expect.
Ultimately, you become frustrated with paid search and decide to break off your on-again, off-again relationship.
But, as with personal relationships, sometimes these breakups are based on misunderstandings. Only after you gain some distance — and more knowledge — do you realize you might have been too hasty in your decision.
So before you send PPC packing, allow me to dispel four common misconceptions that lead to unfortunate PPC breakups.
Misconception 1: PPC is a One-Hit Wonder
I recently audited a PPC account of a floral arrangements retailer. When I dug into the account, I found that the cost per acquisition was around $80 — and the average sale was also around $80. This kind of finding makes my stomach turn. Not because it creates an incontrovertible case against PPC, but because I know many people will jump to that conclusion.
In this case, I was surprised to find that the marketing manager was not only aware of the $80 cost per acquisition (CPA) and $80 average sale, but he was completely fine with them. And no, he’s not crazy!
Why hasn’t he and his team put the brakes on PPC based on these numbers? Because they take a broader view. They recognize that PPC is often just the first step in building long-term relationships with their customers.
As it turns out, the company acquires most of its new customers through paid search advertising. Potential customers find the company’s ad when searching for florists. They click on the ad and end up buying their spouse a floral arrangement for their wedding anniversary (for example). The florist then adds these new customers to the company’s customer relationship management system (CRM).
Then guess what happens? Eleven months later, the florist sends a reminder about the upcoming anniversary, and the customer makes another purchase.
The customer’s spouse is thrilled with the gift. The customer is happy with the service and quality of the product. Before long, the florist becomes the customer’s go-to place to buy flower arrangements for any special occasion.
In this context, an $80 CPA sounds like a bargain.
While we love the data that PPC can provide us, it can be a double-edged sword. Unfortunately, it isn’t unusual for business owners and marketing teams to focus their attention on one or two numbers (such as CPA and average sale) and then use them as the basis of all their decision making.
But PPC isn’t so simple. You have to consider the lifetime value of the customers you acquire, not just the initial “one-hit” wonder.
Misconception 2: PPC Can Stand on Its Own
Recently, a client called to let me know that their call volume was down. My team had already noticed the change and were in the middle of discerning why it had occurred. (It isn’t unusual for call volume to ebb and flow, but we wanted to investigate nonetheless.)
After doing a deep dive into the client’s account, we couldn’t point to anything, in particular, that would explain the volume drop. True, they had experienced a dip in some ad positions, and a few new competitors had come on the scene. But neither of these were terribly significant.
So what was the deal?
When I looked at their analytics data, I had a pretty good idea of the answer. And my theory was confirmed when I asked the client what they were doing in their other marketing channels.
Turns out, the company had been running billboard and TV advertising for some time. But the client had grown disenchanted with these marketing channels, not only because they were expensive but because they couldn’t gage the return they were getting.
As a result, the client decided to stop running their billboard and TV campaigns. Not surprisingly, the results were reverberating across all their marketing channels, including PPC.
This isn’t to suggest that you must stick with the advertising channels you’re currently using. If you’re unhappy with billboards or TV ads or anything else, you can certainly make adjustments. However, I will caution you against shuttering all your marketing channels with the exclusion of paid search.
Paid search is awesome, of course! But that doesn’t mean you can expect it to stand entirely on its own.
Misconception 3: Paid Search Is Too Expensive Relative to SEO
Related to the misconception that paid search should stand on its own is the idea that it’s too expensive when compared to SEO.
We came across this recently when a client told us she was being pressured to scale down her company’s PPC program because it wasn’t performing as well as organic search and direct traffic.
(This isn’t the norm, by the way. Typically, we find that PPC is the top source of revenue and leads for our clients.)
It isn’t unusual for companies to target PPC for budget cuts (relative to SEO) because of perceived costs. We can’t deny that when working with an SEO company, companies only have to pay consulting fees. But when working with a PPC agency, they have to pay consulting fees and cover the costs of ads.
However, we reminded this client that all of her company’s channels were working together to make sales. After all, people find her company in all kinds of ways.
We reviewed some reports with her, which showed that more than half of the company’s sales last month were based on someone coming back to their site two times or more.
In addition, the top conversions report showed that referrals, organic search, email marketing and paid search were all working together to make sales. And often, PPC is the first click in this path to conversion.
So you have to ask yourself: If you remove PPC from the mix, would the sale still happen?
Most likely, you’d see a dip across all channels. Maybe only a little one at first, but then larger over time.
We’ve seen something similar on the few occasions where clients have insisted that we stop bidding on brand because they’re convinced organic search will pick up the slack. This “experiment” typically only lasts a few days before the dive in sales is enough to convince the client to let us bid on brand again.
Undeniably, there’s a synergy that exists among different advertising channels, especially between PPC and SEO. Each channel supports and reinforces the other. In advertising, the whole is truly greater than the sum of its parts.
Misconception 4: You Can Rest on Your Laurels
When companies first step into paid search, it’s not unusual for them to approach the task with enthusiasm. But over time, they get distracted by other channels or projects and are content to leave their PPC program pretty much as is.
But paid search is a channel that can greatly benefit from creative thinking. Often, our most successful accounts are those where clients are willing to think outside the box and work with us to find new ways to leverage their PPC programs. And often, that leveraging comes in the form of offering additional products and services to existing customers.
After all, once you’ve done the hard work of putting paid search in place for your core products and services, it only makes sense to use that same infrastructure for related products.
This could be something as simple as using audience lists to remarket to existing customers. For example, say you’re a retailer of patio furniture. When someone purchases a patio set from you, you use that as an opportunity to follow up with offers of protective outdoor furniture covers. Or maybe you could entice the buyer with planters, a bistro set, decorative pillows, a water feature or patio heater.
Similarly, let’s say you’re a professional organization that offers realtor training and certification testing. In that case, you might want to remarket additional coursework that allows certified realtors to earn certification maintenance credits.
The point is not to get stuck in a rut of “this is how we use PPC.”
Start thinking creatively!
Don’t look at your data and ask whether PPC is working. Rather, the question you should be asking is, “What else could we be doing?” Or more specifically, “What other value-added opportunities are there here?”
Don’t Rush to Break Up With PPC!
Like any relationship, your company’s relationship with PPC will have its moments of frustration. But often these frustrations stem from the misconceptions we’ve discussed above.
By having a more accurate idea of how you can make the most of PPC, your relationship is more likely to be long-lived, advantageous and loving!
More PPC Resources Here:
- Stop Pausing Underperforming AdWords Campaigns and Grow Your Account
- The Top 10 Most Common AdWords Mistakes
- 5 Most Overrated PPC Tactics