Pay-per-click advertising can be a game-changer for small businesses. But if you want to get the best results, you need to be strategic in your approach to developing search advertising campaigns. This all starts with knowing the right best practices for improving return on investment (ROI), but improving PPC ROI is no easy task.
You need to go beyond just setting up and creating campaigns. Even the most experienced Google AdWords managers are constantly looking for new ways to improve their return rates.
If you’re not getting the results you had hoped for from your PPC ad campaigns, use the tips below to boost your PPC ROI:
1. To start boosting PPC ROI, look at your account structure.
The first thing that you will need to look at when trying to boost your PPC ROI is your account structure. If the foundation of your PPC campaigns is not optimized then you will struggle to make significant improvements to your campaigns. Not to mention, it will be difficult to improve PPC ROI over time.
There two main parts of your PPC account that you’ll need to optimize are your campaigns and ad groups:
You can start by organizing your campaigns by relevant themes. Each campaign has different ad groups which focus on your chosen keywords. You will set up your budget at the campaign level. So you’ll need to decide which campaign topics you would like to allocate your PPC marketing budget to before you create ad groups.
Under each campaign, you will have relevant ad groups. These are more specific than the campaign level. Though there is no set number of ad groups that you should have under each campaign, try to keep it manageable. You don’t want to stretch your ad budget too thin across too many campaigns. These ad groups will contain around 10-20 keywords that will trigger your ads when users type them in the Google search bar.
After you have created ad groups, you’ll want to continue to look for ways to optimize and create more targeted groups. Look through your ad groups and find keywords that have a low quality score or low click-through rate. This suggests that these keywords are not relevant to the ads in that group. Consider moving them to a different ad group with more relevant content.
2. Use the best keyword match type based on your objective.
When you create a text ad as part of your AdWords PPC ad campaign, you have the option to use different keyword match types. Your four options are broad match, modified broad match, phrase match, or exact match. Each has different pros and cons that you should consider before choosing the right type of keyword match type for your campaign.
Broad Match Type
Your default keyword match type is the broad match type. This reaches the widest audience as your ad will appear any time a user types in any word that’s in your key phrase. With this match type, the order that the words are typed in the search bar doesn’t matter. Additionally, Google may also show your ad content for ad queries that include synonyms for keywords that you’re targeting.
For example, let’s say that you are using broad match for the term “luxury condominiums.” Google may display your ad for people searching “luxury apartments,” “oceanside condominiums,” or even “luxury vehicles.” Notice that the last phrase is not relevant to your original keyword phrase, but because it contains the word “luxury,” your ad may appear.
Since broad match allows you to reach the widest audience, it’s a great way to drive the most clicks. However, not all of these clicks may be relevant. And as more irrelevant users click on your ads, your ad costs go up without improving your PPC ROI. For this reason, it’s important to be careful about how you use broad keyword match.
Modified Broad Match Type
Modified broad match provides some of the benefits of broad match, but helps you improve the relevancy of your clicks. This type of keyword match allows you to reach a wide audience, but provides better control over which type of search users will see your ad content. With modified broad match, you can lock in certain words in your keyword phrase to ensure that only search engine users who type in these specific words are seeing your ad content.
You can identify these locked in keywords by using the “+” parameter. This tells Google that in order for a user to see your ad, they must type in the specific keyword. For instance, “luxury +condominiums” tells Google that search queries must contain the word “condominiums” in order to see your ad content.
Using this type of keyword match helps you benefit from reaching a wide audience while minimizing the number of irrelevant clicks. Though you may still find that not all of your PPC ad traffic is relevant, this is a good way to reach more of the right types of consumers with your paid search ads.
Phrase Match Type
The phrase match type gives you even more control over who clicks on your ads than the modified broad match. With this match type, your ad content only appears for search engine users that type in your identified keyword phrases in the exact order you’ve entered them. However, it does allow other words to be before or after the keyword phrase.
Using the example above, let’s say that your keyword phrase is “luxury condominiums.” Using phrase match type, your ad many appear for people who type in “beach front luxury condominiums” and “luxury condominiums in Los Angeles” but not for phrases like “luxury condos” or “luxury lakefront condominiums.”
This type of keyword match helps you reach more relevant consumers as it ensures that they are using all parts of your keyword phrase. However, since your ad appears for search queries that may contain extra information before or after the search phrase, you’re still able to remain visible for a wider search audience.
Exact Match Type
Exact match type is the most restrictive keyword match type that Google offers, allowing you to reach the most relevant search engine users. As the name implies, with exact match type, your ad only appears to those users who type in the exact keyword phrase that you are trying to target.
With “luxury condominiums,” your PPC ad will only appear to those who search for this exact phrase, using those words in that exact order. On the one hand, this will help you reduce costs from irrelevant clicks. But on the other hand, you are restricting your traffic volume as the more specific search queries will have a lower search volume.
3. Make sure your campaign has negative keywords identified.
Another way to improve your PPC ROI is by using negative keywords. Negative keywords are words that your ads will not show up for in the search engine results. By using these keywords, you can help make sure that your ads are not appearing in front of search users who are just not a good fit for your brand.
For example, let’s say that you want to appear for the search phrase “operations management consulting” but you don’t want your ad to be shown to those who are searching for free advice. You can add the word “free” to your negative keyword list to make sure that you don’t show up for people who search for “free operations management consulting.”
If you do not utilize negative keywords, you can waste a lot of clicks on uninterested users. Since every click costs your business money, these clicks from irrelevant search users will drive your costs up and your return on investment down. Be sure to think carefully about which negative keywords you plan to use so that you can avoid clicks from consumers who are not a good fit for your brand.
4. Improve PPC ROI by determining customer acquisition costs.
Another important part of improving your PPC ROI is determining what your customer acquisition costs are and calculating your average customer value. Knowing what the average customer is worth to your business helps you determine how much you are willing to spend to acquire that customer.
The customer acquisition cost for your PPC ad campaigns can be calculated by dividing the cost of your PPC ad campaign by the number of customers that were acquired through that campaign. For example, if you spent $100 on an AdWords campaign and acquired 10 customers, then you customer acquisition cost is $10.
You will want to compare this acquisition cost to the total average customer value. For example, if the average new customer brings $10,000 in new business to your brand, then a $10 customer acquisition cost may be worth it. However, if they only bring in $100, then paying $10 to acquire a new customer may not be worthwhile to your business.
Once you determine the customer acquisition cost for your PPC ad campaigns, compare this to the average value for a customer over their lifetime. How much are you willing to spend to acquire a new customer? Knowing this information ahead of time will allow you to develop an adequate budget for your PPC campaigns. It will also help you be more strategic about which ad campaigns you run and which you decide to end.
5. Know what factors you want to test.
A/B testing your PPC ad campaigns is a very important part of optimizing your ads and achieving a high PPC ROI. If you want to maximize profitability, you need to A/B test different elements of your PPC ad campaigns until you find the perfect combination.
When A/B testing, it’s important to remember that you’re only testing one ad element at a time. There are four different elements that you will need to test to optimize your ads:
- Headline – This shows up as a blue link in the search results. It should reflect what you are offering and get to the point in 4-5 words.
- Body Text – The body text is much like a meta tag. This gives the search engine user more information about what you’re offering.
- Ad Link – The ad link is the page that your ad links to. This should be a targeted landing page that relates to your ad, instead of something more broad like your home page.
- Keywords – You can also test the keywords that your ad appears for. Certain keyword combinations may convert better than others.
Once you have determined which variable you want to test first, you’ll need to create two variations of your ad. Again, the only element that should change in these two ad variations is the element that you are trying to test. For example, if you are testing the headline, you will change the headline for each ad, but keep the text, link, and keywords the same.
As you run your test, monitor the results of each ad. Which ad is bringing in the most clicks? Which has the highest conversions? Once you find the right headline, you’ll also want to test the other elements of your ad one by one until you’ve found the winning combination.
A/B testing takes time, but in the end, it’s the only way to know for sure which ad variables are going to bring you the best results. Testing each element of your ad for each ad campaign can help you maximize your PPC ROI.
It’s important to note that there is an unknown profit factor when it comes to PPC campaigns. Many businesses will still make a profit with click-throughs later on, even if it isn’t a direct conversion of the PPC ad. This is often the result of repeated ad exposure, making paid search advertising all the more important as a part of your digital marketing strategy.
If you want to boost PPC ROI, it’s vital that you follow best practices for paid search ad campaigns. The tips above are a great starting point for helping you optimize your PPC ads so that you can start seeing better results from your campaigns.
If you need more advanced help with your paid search ads, you may want to work with a PPC ad agency. A digital marketing agency that specializes in PPC ads can help take your campaigns to the next level using advanced tactics.