Just like you wouldn’t have your general physician take care of your dental needs and concerns over possible skin cancer, you need to take a comprehensive approach to your PPC “health”. For many businesses, their PPC budget is dumped into general marketing and advertisements. The goals, seasonality, projections and other details of PPC programs aren’t given much thought before a business jumps on a PPC project. That’s a mistake, because budgeting is crucial when defining a PPC strategy.
Whether you have a marketing team in-house or outsource marketing and PPC needs to a premium local service, you need to make sure your PPC programming and budgeting is on point. Does it matter how much you spend if you’re reaching your goals? Yes, since there are a number of variables to look at and this oversimplifications of PPC can prove detrimental in the long run.
How to budget for PPC goals
When crafting a PPC budget, get clarity on metrics like spend/revenue, cost per conversion, average order value, ROI and conversions. If a business wants five percent growth each year (for example, hoping to achieve a revenue of $5.5 million in 2015 compared to 2014’s $5 million), you’ll need to spend more. While Forbes recently reported the adage spending money to make money can be a falsity, that’s not true in the world of PPC. However, you do need to keep an eye on the bottom line in order to make your spending viable.
Calculate your benchmark by considering efficiency vs. volume calculations. Efficiency may need to be sacrificed to grow revenue by a certain amount, and you need to figure out if that sacrifice is worth it. One business might decide that they can spend an extra $200,000 next year in order to reach that five percent growth they’re after. This can be spent on aggressive bidding, adding in new features like remarketing, or getting on board with new platforms. Check out what Doz recommends for best marketing platforms to get started.
Don’t forget the analytics
Before creating a brand new budget, make sure to take seasonality into account by looking at historical data. For many businesses the fourth quarter is the busiest, and sales slow down in the summer. A budget should reflect this seasonality, so go back at least two years and break down performance month by month. In some instances, higher efficiency should be calculated in and lower efficiencies also have their place.
A good PPC strategy should encompass when to cut efficiency and which features to utilize at what time. You can also see which platforms will deliver which results at a given time of the year. Once the figures have been pored over and there’s a plan, stick with it. There will always be unexpected circumstances popping up, but a good budget plan will lead to a successful goal over time. For example, maybe you decided that January was a great time to kickstart a new display campaign so you can milk the most out of the big holiday season.
A PPC campaign that works
Keep an eye on the bigger picture and trust that your budget will keep you on the right path. Good PPC budgeting, however, is more than the primary goal. There are many factors at play, which can all help drive annual planning. Right now is the season to develop 2014 budgets and ensure all PPC program aspects are addressed. Take this time to look at your PPC successes and failures in 2014 and 2013 so you can do better in the coming year.
PPC isn’t easy, and sometimes it’s best to let a professional take the wheel.
