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PAY-PER-CLICK: Setting up the PPC Budget!

Examining PPC ad campaigns more closely, one should budget just enough money to attract the value traffic profitably.

You should know that the Average Conversion Rate – a percentage of people that actually purchase a product or service after clicking on an ad – on the Internet is in between 2% and 4%.

 

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SETTING UP THE PPC BUDGET

Mind you, the Average Conversion Rate – a percentage of people that actually purchase a product or service after clicking on an ad – on the Internet is in between 2% and 4%. If promoting a new business let us assume a 3% conversion rate for your website, i.e. 3 out of 100 customers that click on your PPC ad would purchase your antique car dynamo for $200. If there is a $90.00 profit out of those three customers and you have to spend $25.00 to acquire these hundred visitors, then a profit of $65 ($90 - $25).

It is obvious that PPC campaign can make or break the online marketing budget. Again, the relevancy of your ad is the most important factor that differentiates making from losing money. Every percentage increase in the conversion rate changes the calculation.

* 4% rate = CPC $0.25 x 100 = $25.00 to make $120.00; PPC cost is 20.8%

* 5% rate = CPC $0.25 x 100 = $25.00 to make $150.00; PPC cost is 16.66%

* 9% rate = CPC $0.25 x 100 = $25.00 to make $270.00; PPC cost is 9.25%

But keep in mind that things can go “south” very quickly:


*1% rate = CPC $0.25 x 100 = $25.00 to make $ 30.00; PPC cost is 83.33%!


HOW TO WRITE A GREAT PPC AD?

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Every single detail in the ad must be totally relevant to the product or service you’re selling. Yes, RELEVANCY again – we cannot stress that enough, in PPC as in a great SEO work, RELEVANCY is the king. Poor relevancy in PPC costs money; good relevancy yields increased revenue. .

 

Keywords used in a PPC campaign must be as specific as possible. If you sell cars, and you not only sell “nice vintage cars”, but you have “1967 Corvette Palm Beach” so you target only online visitors in Palm Beach and vicinity and who are looking to purchase a 1967 Corvette. Do not forget to build an expanded keyword list for testing that could go to as many as 100+ keywords that you’d have to closely monitor and adjust its usage, depending of a performance any particular word produces in the ad campaign.

In designing a PPC ad campaign “think as customer thinks.” If you’re selling hydraulic pumps for a vintage Corvette who’s your client? A no-nonsense guy whose pump is down and who needs to have it repaired or replaced ASAP. Therefore you write your ad for such a guy and promise “Same Day Hydraulic Pumps Repair” in a body of your ad (your keywords are still “hydraulic pumps repair”). Offer great service and deliver great service.

Landing pages MUST also deliver the promise from the ad. If someone searches for the exact term he or she would seek to see that same term on the pages they came through a “click” or they might leave the website and never come back. Also, always Add the URL of the target website; if running a promotion, sale, free shipping, or anything that benefits a potential client, create a landing page for the specific ad and emphasize the special offer.

Google AdWords, MSN adCenter, Yahoo Overture

 

 

 

 

 

 

 

 

 

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