How Can You Increase Your AdWords ROI?
The average conversion rate on AdWords text ads is less than 3%.
On display ads, it’s less than 1%. Yet you’ll pay $2 or more per click for the 97% of people who didn’t convert.
With that kind of odds, it can be hard to get a decent AdWords ROI, let alone a great one.
To make matters worse, it’s getting more expensive to run ad campaigns all the time.
Ad spend across industries has gone up almost 24% a year over the past several years.
But there is a light at the end of this tunnel that leads to you optimizing your AdWords ROI.
You can take clear steps now to significantly reduce your cost per click while increasing your conversion rate.
This translates to higher revenues at a lower cost.
Let’s look at how it’s done.
11 Steps On How To Reduce Your CPC
- Optimize Your Website First
- Understand the Quality Score
- Align Landing Pages to Your Ads
- Match Keywords to Buyer’s Journey
- Reevaluate Targeted Ad Groups
- Don’t Pay Too Much Per Click
- Choose Mid-Range Keywords
- Use Broad Match Modifiers
- Don’t Ignore Negative Keywords
- Prevent Unqualified Clickers
- Take a More Comprehensive Approach
Are you sending mobile traffic to a bad mobile experience?
You’ve just wasted the cost of that click. That’s no way to maximize your Adwords ROI.
74% of mobile users will abandon a website that isn’t mobile-friendly. This amounts to losing almost half of your total click-through traffic.
You have to pay for those clicks even if the person immediately leaves your site.
If your site is slow… If it’s hard to navigate… If it looks like a mess… You’re wasting those clicks (and money).
On top of paying for a click that you had no opportunity to convert, Google is watching. You knew they would be.
A bad website experience will earn you a low-quality score on AdWords.
The lower this score, the more you’ll be charged per click. That can cut into your returns faster than anything.
Focus on optimizing your website experience. These 3 are most important.
a. Test Your Speed
Visit the Google Page Speed Test. Test your site. It will make recommendations to improve your speed.
Many of these will be easy to apply with basic knowledge of, and control over, your site.
For others, you may need to turn to your webmaster or other professionals with knowledge about web design.
If your site isn’t terribly slow, do what you can.
Even small, easy changes like optimizing images or getting rid of unnecessary widgets can speed up your site significantly.
b. Be Easy to Navigate
Revisit your menu and buttons. Is it easy to know where to go?
Are you creating choice paralysis by having too many options? Minimalize your menu.
c. Test Your Site on Various Devices
Is the text big enough to read? Do you have to scroll back and forth to see the whole page or an image?
Know what the website looks like to visitors. Remember, over half of them are viewing your page on a mobile device.
Fix any poorly functioning elements or bad formatting to maximize your AdWords ROI.
Google also has a mobile-friendly test to give you a hand.
Many of the topics in this article will improve your quality score in one way or another. But it’s important to understand what it is first.
When you do this, you’ll better apply this article’s valuable information to quickly improve your AdWords ROI.
Your quality score will make or break the cost-effectiveness of your pay-per-click (PPC) advertising. The reason for this is simple.
If you’re providing a low-quality experience, Google doesn’t want to have anything to do with you.
By making you pay more per click, they’re trying to get you to do one of two things.
Either stop running ads because they don’t make financial sense for you. Or fix whatever is wrong with your user experience.
They are really hoping for the latter.
How Google Determines Your Quality Score
Your quality score will go up or down as Google makes note of the following:
- Click-through rate — If they show your ad on the keywords you requested, but few people click, it appears that your ad is irrelevant.
- How relevant a keyword is to its ad group
- How well your landing page performs — Google uses analytics to determine how people respond to the page.
Their involvement doesn’t stop once the person clicks. Your landing page is whatever page you have the ad clicks directing people toward.
If it’s your home page, we need to have a talk. Don’t worry. We’ll tell you how to fix this in the next section.
- How relevant your ad text is to searchers — They can see it’s not relevant if people don’t click.
Or they click and then leave your page because they thought it was something else.
Google will use these factors to rate your ads on a 1-10 scale. 10 is best. 1 is a disaster.
Even after you fix things, it takes time to recover from a prolonged bad user experience (UX). Google is judging you for past performance.
To update your score, they need to know that you’ve really improved the experience.
They won’t instantly change it when you improve your UX.
If your campaigns are struggling, the sooner you resolve this the better.
How Quality Score Impacts AdWords ROI
So, what’s your reward for having a high-quality score?
If you have a 7 or higher, then they’ll give you a discount compared to what others are paying for that click.
This discount can save you as much as 50%. Your ads will be given better “real estate” when Google is choosing where to place which ads.
What a great way to get a respectable AdWords ROI!
On the other side, if you have a 6, your cost is raised slightly. If you get down to a 1 or 2, then getting a good AdWords ROI is impossible.
You could pay as much as 400% more than someone with a decent quality score.
Over time, Google will show your ad less and less. It’s their not-so-subtle way of saying “Fix it or get lost!”
They take this approach because they value the experience of their customers, the searchers.
Finally, as if things could get any worse, you’ll have abysmal conversion rates because of a bad user experience.
In effect, you’re getting punished for the same “crime” 3 times.
But enough of the bad stuff. Let’s get back into solutions.
Google specifically recommends that you create custom landing pages for your ads.
An effective landing page optimization provides a clicker with a seamless experience.
In order to convert clicks, you need to generate this flawless transition. There’s no room for distractions.
Your landing page takes a person to the logical next step.
According to Hubspot, businesses with 40+ landing pages generate 12X the leads of websites that have fewer than 5.
And yet, research firm eConsultancy found that 61% of businesses have no more than 5 landing pages.
It’s worth the time and money to create aligned landing pages.
And it’s likely your competition isn’t creating custom landing pages. That gives you the leg up.
If the ad offers a 20% discount, the landing page has a clearly visible button to redeem it.
Everything else on that page is directly related to the ad and its offer.
If the ad is addressing dentists, you shouldn’t send all of the ads that address chiropractors, lawyers, and nutritionists to the same page.
The reason is simple.
You can connect with each target more effectively when you customize a landing page for each one.
And did you know that the best landing pages can have a conversion rate of 24.7.%? However, success doesn’t always mean several purchases.
Instead, the true measure is improvement.
Does your conversion rate increase every month? Does it grow together with your website traffic?
How to Optimize Landing Pages
Only 52% of businesses analyze the performance of their landing pages.
That’s great news for you. Chances are that your competition isn’t optimizing. If you do, you’ve got a serious advantage.
Use Google Analytics or paid tools to see how each page is performing.
Do A/B testing for a single landing page format to see what works best. This is when you create 2 slightly different versions.
Then test each one with the same ad to see which works best. You might change only a little wording, color, image, call to action, or another element.
Before you optimize, create landing pages that follow proven best practices.
Let’s explore some quick tips to create better landing pages.
Tip 1: Put your CTA (call to action) below the fold.
That just means that people have to scroll down a little to see it.
The CTA shouldn’t be so close to the top of the page that it’s the first thing they see. If it is, it’s like screaming “buy this” to a stranger on the street.
You wouldn’t like that. Today’s consumers don’t either.
Expand on your ad a little first. Tell them who you are and how you can help them.
Explain what they’re getting. Then put a descriptive CTA button like:
- Claim Your Discount
- Start Getting Results Now
- Download the eBook
Marketing research firm, Marketing Experiments, found that a CTA below the fold can generate 220% more leads.
Tip 2: Have only one offer on a landing page
If you make people think about which to choose, they start having seconds thoughts.
48% of landing pages have multiple offers, showing that some people aren’t getting the memo.
By only having one, you’ll outperform those who do.
Tip 3: Reduce or eliminate the menu.
Removing the navigation menu can increase conversions by 100%.
Ideally, your landing page should stand alone. It shouldn’t lead people anywhere else.
Tip 4: Test everything and keep an open mind.
These are known best practices. But you could be the exception. If something doesn’t seem to be working, revisit it.
For a more complex buying decision, for example, a menu may be needed.
Make changes and compare your results.
If you’re running AdWords campaigns by simply including as many keywords as possible without regard to how they align with searches…
…you’ll struggle to get a decent AdWords ROI.
The keywords should align with your ad which aligns with your landing page.
To do this, think about the buyer’s journey. Here it is in a nutshell.
This is the top of your funnel and the beginning of a buyer’s journey.
If you’re not building awareness through other methods like social media and content marketing…
…how you reach people through AdWords is incredibly important.
People must become aware of you or the challenge you solve first.
Because they are early in the journey, they’re in research mode. They may not be ready to buy yet.
The goal of an awareness campaign is not to make a sale. It’s to educate and convert a visitor into a lead.
The ad should offer valuable information that furthers the buying decision when clicked.
The keywords you select will reflect this stage. If you sell window air conditioners, then awareness keywords might be:
- Window air conditioner reviews
- Best window air conditioners
- Shop for window air conditioners
- Window air conditioner guide
Depending on your marketing angle you might also use:
- Affordable window unit
- Most energy-efficient window AC
- Reliable window units
You can also catch people before they’re even thinking about a new window AC with terms like:
- How to fix window units
- Troubleshoot AC
- How much energy is my AC using
- How to reduce cooling bill
As you do your keyword strategy, the keyword planner will offer more options that may fall into the awareness category.
Consider each phrase and what stage it represents.
In this stage, the buyer is in the market. But they may not feel any urgency to buy now.
They’re thinking about what they researched during awareness.
They could be persuaded to buy now given the right offer. Consideration keywords will normally be paired with an ad that offers a discount.
To continue our example, consider the following:
- Window AC discounts
- Air conditioners on sale
- Best place to buy air conditioners
Also, consider this example of a great consideration stage ad for women’s shoes.
If you weren’t able to further the person along with your enticing offer, they’ll search while in this stage.
Use high intention keywords and make it super easy to buy, schedule, etc. These should convert to instant sales.
Use words like:
- Buy window unit
- Where to buy model 9X984fg
- Appliance store near me
- But AC in Atlanta
Each of these represents the fact that the buyer has done the research and knows what they want.
Here’s another example of a great decision stage aligned ad for the keyword “Buy Asics Nimbus”.
The ad takes you to a landing page where you can see the various colors and variations for this athletic shoe style.
Missing a Stage
You may be wondering:
Why don’t I just run campaigns focused on the end of the journey? Why waste time or money when people aren’t ready to buy?
Think of a funnel for a moment. As it nears the bottom, it gets smaller.
As your competitors siphon off customers earlier in their searching, there are fewer for you by the time they get to the decision stage.
Reach people at all stages or the competition will.
Whatever the stage, align the ad and landing page to maximize results.
Here’s an example of an ad from Sears that’s poorly aligned to the awareness keyword they used “best window air conditioner”.
Can you see why? Which stage does this ad better represent?
Review your ad groups. Find keywords in those groups that have low-quality scores compared to the others.
These keywords may perform better in a different ad group. Consider moving them or removing them.
If you’re using broad match rather than exact match, pull the report to find out what actual phrases are triggering your ads.
You may want to add some of these phrases to your keywords to better track performance.
In some industries it can look like the only way to get seen is to pay a lot for a click.
If each click were a guaranteed loyal customer it might make sense. But generally paying over $6-$10 for a click is too much for AdWords search ads.
Instead, dig a bit deeper into your keywords. Find less competitive ones that cost less per click.
This takes some time and effort. But it pays off in improved AdWords ROI.
With AdWords, there’s a sweet spot in keyword length. It’s not effective to have keywords that are short (1-2 words).
These words will typically cost too much per click. And they’re less relevant because they’re less descriptive.
It’s also not as effective to have long keywords.
If your keywords look more like a blog title in length 8-10 words, it’s hard to get enough visibility to get a decent AdWords ROI
Mid-range has shown to be the most effective in both generating traffic and being relevant.
Broad match means that the searcher doesn’t have to type in the exact phrase to trigger your ad.
They put the words in a different order or ad an extra word. It still causes your ad to appear.
But broad match by itself can go too broad. This causes your ad to seem irrelevant in many searches where it appears.
Google now has “broad match modifier” which allows you to limit how “broad” your matches go.
It will include singular plural, synonyms, common misspellings, etc. But it’s not so broad that it opens you up to completely irrelevant searches.
Sometimes knowing what you don’t want is as important as knowing what you do. Create a list of negative keywords.
Continually update it as you see which terms are triggering your ads but are really irrelevant.
For example, let’s say that you own a hair salon. This salon has a great reputation.
Because of it, your stylists are able to charge higher prices.
You might use “Where to get a haircut” as a keyword. But if the person types in “where to get a cheap haircut”, you don’t want that to pull up your ad.
First of all, if the person clicks your ad, you’ll have to pay for that click. The clicker will realize your prices are too high for them and leave.
Second, if they don’t click, your ad looks irrelevant, lowering your quality score.
Negative keywords that most businesses should start with include:
- Jobs (unless your ad is for recruitment)
- Tips/Hacks/Tricks (unless you’re advertising an article or video)
Some of these “negative” keywords may surprise you. Monitor regularly and keep adding.
Create a list for future reference on other ad campaigns to reduce negative keyword upkeep over time.
Do you sell high-end watches in your eCommerce store?
Then paying for a click from a person who wouldn’t pay more than $30 for a watch isn’t your target audience.
Even if you put luxury language in the ad, this person may click, not knowing how many luxury watches cost.
In some cases, it’s beneficial for companies that sell products and services at a premium to put something to the effect of “Starting at $5,000”.
You’ll save the searcher some time and yourself the money.
AdWords is great because it’s easy to measure performance. It’s easy to get started and you can generate sales quickly.
But you’ll pay a premium for those clicks without a more comprehensive strategy in place.
A comprehensive digital marketing strategy generates greater awareness for less.
It uses digital strategies like those found in social media and content marketing. It uses these strategies to nurture leads during the consideration phase.
Adding email marketing allows you to further nurture leads in a highly customized and meaningful way.
And we’ve already discussed how important a responsive website is. That’s part of a comprehensive strategy too.
By the time a person clicks on an ad, they’ve already seen you elsewhere. They already know who you are.
They already trust you. They may have even developed an emotional connection to your brand.
They’re ready to buy when they click. A more comprehensive strategy causes not only more clicks but higher conversion rates on those clicks.
To further improve your AdWords ROI, branch out to develop a single consistent brand experience.
Maximize Your AdWords ROI To Grow Your Business
Stop paying too much to acquire a customer.
If your cost per click isn’t what it should be, you can’t get a reasonable AdWords ROI.
By applying the steps, you can lower your costs to improve your ROI.
To learn more about how we can help you achieve the highest AdWords ROI and grow your business, contact us today!