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This article was provided by Practical eCom.
Pay-per-click advertising is essential for many ecommerce and omnichannel retailers. Google, Facebook, and other ad platforms have made it easy to set up a campaign. Their machine learning can even identify audiences and keywords.
PPC success, however, often depends on careful planning and preparation, not rushing out to place ads.
Moreover, PPC advertising is almost always iterative. So even with planning, a fully optimized campaign could take months.
What Is the Goal?
It is too easy to buy PPC ads with only a vague idea of what they are supposed to accomplish.
To start, define for each new campaign a SMART goal — specific, measurable, achievable, realistic, and timebound.
Imagine you sell subscriptions for premium ice cream. Subscribers receive various “flavors of the month.” A PPC goal might be to increase monthly recurring revenue by $25,000 in the for you in future quarter.
Can I Afford It?
Next, decide if your goal is affordable.
An objective of generating $25,000 in new monthly recurring revenue requires knowing some things about the direct-to-consumer ice-cream-subscription business, such as a competitive subscription price and the customer acquisition cost.
For example, if the typical subscriber pays $25 per month, you need 1,000 new subscribers over three months. And a customer acquisition cost of, say, $27 requires $27,000 to fund the campaign.
And this says nothing about your company’s profitability. If the cost of goods is $12.50 per order, you would need a subscriber to stay at least two months to break even.
Monthly Subscription Revenue – Monthly Cost of Goods = Monthly Gross Profit
Customer Acquisition Cost / Monthly Gross Profit = Number of Months to Breakeven
$25 – $12.50 = $12.50
$27 / $12.50 = 2.16 months
Run these sorts of scenarios to ensure your campaign goal is realistic.
Who Is the Customer?
Having a SMART goal that has survived your customer acquisition costs is not enough.
It’s essential to understand your target customer. Developing a customer profile or persona can help, especially when it comes time to write ad copy.
Consider the customer’s needs. For example, in 2019, Google, together with the Kantar Group, an analytics and consulting firm, identified six needs that drive search behavior:
- Surprise me. Search is fun and entertaining. It is extensive with many unique iterations.
- Thrill me. Search is a quick adventure to find new things. It is brief with just a few words and minimal back-button use.
- Impress me. Search is about influencing and winning. It is laser-focused using specific phrases.
- Educate me. Search is about competence and control. It is thorough: reviews, ratings, comparisons, etc.
- Reassure me. Search is about simplicity, comfort, and trust. It is uncomplicated and more likely to include questions.
- Help me. Search is about connection and practicality. It is to-the-point and more likely to mention family or location.
“Each need state is made up of a combination of emotional, social, and functional needs. Emotions are the foundations of need states. The truth is, decision-making is not a rational process, but one driven mainly by how people feel. The rational brain layers on reasons for our choices only after they’re made,” wrote Justin De Graaf, Google’s head of user experience research.
“And those needs have a profound impact on search. How long the query is. How many times a person hits the back button. How many tabs a person has to open. Which device they’re using. The number of search iterations. Whether a person prefers text, image, or video results. How many different things they type into the search bar.”
Those needs are also likely to impact your PPC search advertising.
Once you know your customer, you’re ready to develop the keywords and structure for your campaign.
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