Setting Goals For PPC

Whether you’ve worked in-house or at an agency, you’ve been there. You have been tasked with creating a new PPC account or campaign, and you’ve been given some lofty goals by the main stakeholders of the project. And many times, those goals are a little too optimistic for what can reasonably be achieved within budget, time, or traffic constraints. So it’s up to you as the PPC expert to help set more realistic goals for what can be accomplished. Fortunately for you, I’ve been through this process more times than I’d care to admit. Here are some lessons I’ve learned along the way.

First, I like to start with a traffic estimation. You can get some decent numbers from the Google Keyword Tool, but I wouldn’t rely on it for total accuracy. To do your estimation, choose 10-15 of the most relevant keywords you can think of for your new category and run them in the tool. Remember to use local exact match numbers to get the best estimation. Using global numbers isn’t relevant if you’re only targeting one country, and broad and phrase match estimates include too much irrelevant traffic to be really useful for an accurate estimation. When you get a new list of keywords from the tool, choose the top 10-15 most relevant keywords with the highest traffic volume (which may or may not be the same list of keywords you started with). These keywords will be a representative index of how much traffic you can expect. If your boss wants to reach a million unique users per month with the new campaign, but your total index traffic volume is only 10,000 impressions per month, you can use this data to convince your boss to revise his expectations. A lot of ambitious plans get derailed at this stage. If there’s not enough search volume for your keywords, you simply cannot get enough clicks and visitors to make enough money to meet your ambitious goals.

But let’s say that your traffic numbers work out. Next, you’ll have to figure out what your costs will be. On your Google Keyword Tool report, make sure you have the “Approximate CPC” column selected. Using this and your search volume, you can create an estimate of how much your traffic will cost.

First, you’ll need to estimate your total monthly clicks. This will vary by your average CTR, which in turn will be affected by your ads and industry. I like to use 2% CTR as a ballpark estimate for most new accounts. So you start with your total monthly search volume for a keyword (assuming you capture 100% of that search volume), take 2% of that, then multiply that number by the average CPC to get your estimated monthly keyword cost. Here’s an example for a keyword with 1000 monthly searches and a $2.00 average CPC:

1000 monthly searches x 2% = 20 clicks
20 clicks x $2.00 = $40 PPC cost/month

You may find that your vertical is far too competitive to work within your budget constraints. This is another stage where plans get derailed.

If your goals check out on both the traffic and cost side, the final thing to consider is your time. If a new campaign is going to take you 40 hours a week to build out and manage (while you still have other things to do), then it just might not be feasible even if the traffic and cost numbers work out. You should also consider the revenue upside vs. time investment. It might seem like a good idea to branch out into third party PPC offerings, but if it’s going to take you 5 hours a week to manage and your search volume calculations indicate there’s only about $50/mo in revenue at stake, then you’re probably better off using that time elsewhere. Don’t forget to consider time when planning a new campaign, or you might find yourself committed to something that’s just not worth it.

About Shawn Livengood

Shawn Livengood is a search engine marketing professional based in Austin, Texas. He has extensive experience managing pay-per-click ad campaigns for clients in various industries, from small home-based businesses to large international companies. You can connect with Shawn on Google+.
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