Incorrect assertions people often make about PPC

As a marketing channel, Pay-Per-Click is a relatively affordable advertising platform for most businesses; the cost is both controllable and measurable. So with this in mind, it’s no surprise that so many businesses attempt to set up, launch and manage their PPC campaigns internally. Often this means that the PPC campaign was designed and is being managed on an ongoing basis by someone that has no prior experience of marketing and/or optimising web traffic.

The offshoot of this is that many inexperienced PPC managers have a negative experience with the medium. And of those who haven’t tried advertising through PPC but know someone who has, often they hear only negative stories about it.

This blog focusses on five of the most factually inaccurate statements I often hear about PPC. Some of these comments I have heard from prospective clients who have had a bad experience of PPC, or whom have preconceived misconceptions about the medium.

"PPC doesn’t work- I've heard this remark branded around a lot, often from marketing directors who have "dabbled" in PPC. Here's the deal: with PPC, you are effectively directing an almost limitless amount of traffic to your website. Ultimately, you (or the PPC Manager) are in control of both the volume and quality of that traffic. Quality is the operative word here, because if you are directing unqualified, low quality traffic to your website, then you are unlikely to make profitable gains thorough PPC marketing.

Similarly, if your website itself is poorly designed or, worse still, your business is unprofitable or its products and/or its services are not competitive enough, then all the traffic in the world isn't going to help you generate a profitable return on your investment. By saying that PPC doesn't work, you are simply turning your back on the biggest advertising medium on the planet: Google.

And of course, websites that generate millions of pounds worth of revenue through PPC will also attest to the power of this channel. Hopefully the rest of this article will help shed more light as we discuss some other incorrect assertions.

"My competitors will click on my adverts" - Whenever a client of mine says this to me I always respond with the following remark: "Do you click on your competitors' adverts?” Their response is always no, but for those reading this that are still concerned about fraudulent clicks, let me allay those fears.

Firstly, Google uses an advanced algorithm that cleverly identifies fraudulent activity - any such clicks are quickly identified and filtered out. Whilst this doesn't often this happen, when it does, credits are automatically added to the PPC account and the client is refunded accordingly. Google also proactively examines PPC accounts and intervenes manually if it identifies suspected fraudulent behaviour. If an offending PPC advertiser is identified, then they may be banned from advertising on Google. Similarly, if the data on the PPC account suggests that fraudulent activity is taking place, then the PPC Manager may manually request that Google investigate the activity.

It is worth noting that in my years of managing clients’ PPC campaigns, I have never had to manually request an investigation into fraudulent activity. Consider the following: as a business owner or marketing manager, do youhave time to sit around all day clicking on your competitors’ adverts and potentially evoking the wrath of Google, putting your own marketing endeavours at risk? Probably not!

“I have set CPA targets for you to meet” - For clients that operate purely on a lead generation basis, then the concept of optimising a campaign to meet a maximum cost per lead is understandable. This is particularly true if they offer a one-off product or service at a set price that never changes. But for ecommerce sites and, indeed, lead generation sites that offer numerous products and services, the value of which will vary from order to order, then optimising a PPC account to meet a set CPA target is counterproductive.

In a PPC campaign, profit cannot be measured by cost per sale or lead alone, whether the cost is being measured at keyword, ad group, campaign or account level. Instead, overall return on investment is a truer indication of performance and profitability, and the value of any leads and/or sales generated should be measured both independently and as a whole.

As an example, let’s say you have a set CPA of £10 per lead. Consider which is more valuable to you: a CPA of £20, which generated a lead worth £1,000 (a return on investment of 4900%); or a CPA of £5, which generated a lead worth £50 (a return on investment of 900%).

Optimising for profit is far more beneficial in the long-term than restricting yourself to set targets.

“What use is there in hiring a PPC manager when I can do the work myself?” I can understand the logic behind this comment, even if I completely disagree with it. If like me you enjoy data analysis, optimising marketing campaigns and carrying out incremental adjustments to maximise revenue, then PPC can certainly become an addictive medium on which to focus one’s attention. The difference, however, is that I work full-time on managing clients’ PPC accounts, whereas you are most likely a full-time marketing manager or business owner with much more important things to do with your time. Also ask yourself whether you really have the time to dedicate at least 10 hours per month (most likely more if you have a large campaign that generates thousands in revenue per month), to carry out regular optimisation and analysis, on both paid search channels and their effect on online channels as a whole?

“I expect profitable results within the month” - it is not unreasonable for clients to expect instant results on a newly-launched PPC campaign. After all, you are investing money into marketing activities which need to be profitably viable. But there are many reasons for running a PPC campaign, and whilst direct response success (in which a profitable lead or a sale is generated through your marketing endeavours) may be your ultimate goal, understand that profitable results aren’t always going to happen straight away.

This is none truer than when a newly launched business or website begins its first foray into the world of online advertising. Such data-starved companies have little historic data from which to forecast growth and revenue via paid search channels. Any advertising agency that offers you solid revenue forecasts for PPC when there is no data on which to base those claims are only giving you false hope. In reality, an element of experimentation is required, during which the most profitable segment of traffic is identified. Sometimes this can take two or three months to perfect, as we filter out traffic that doesn’t generate a profitable return, continually testing the market until the top-performing search terms/demographic have been captured. Once the top performing search terms, landing pages, messaging and products/services have been identified and profitability has been achieved, then the campaign can be expanded, traffic volume can be increased, and some degree of forecasting can be provided.

Of course, websites with plenty of historic online data on which to base our marketing decisions will increase the chances of us implementing a PPC campaign that generates a profit for you straight away. However, where data is lacking, the campaign must first generate the data for analysis.

But even if certain areas of your PPC campaign have not generated a profit to begin with, then one thing is for certain: the data accrued has provided you with invaluable insights on which to base your future marketing decisions - why did this product not perform while the other did? What element of my website can be improved to increase conversions of that product? Is this product viable at all? Ad infinitum.

PPC entails far more than choosing the right keywords, writing engaging ad copy and changing bids - it is a powerful medium, in which the slightest change may have a huge impact on both the short- and long-term performance of all of your marketing channels.