Google Ads and budgets

Discussion in 'SEO, PPC and Online Marketing' started by VillainousRaccoon, Mar 15, 2021.

  1. VillainousRaccoon

    VillainousRaccoon UKBF Newcomer Free Member

    1 0
    Need help setting out budgets for google ads, my company wants to run keyword-based ads and we have never done this before.

    I've looked through the google documentation and I roughly know basic concepts (short tailed, long tailed keywords etc.) but I also know that google SEM is exorbitantly expensive and I'm worried about what I can do to reduce costs or make it economical.
    Posted: Mar 15, 2021 By: VillainousRaccoon Member since: Mar 15, 2021
  2. fisicx

    fisicx It's Major Clanger! { Moderator }

    34,367 10,201
    Depends on what you are selling and to whom.

    You can run successful campaigns for £10/day or you can spent £50/click.
    Posted: Mar 15, 2021 By: fisicx Member since: Sep 12, 2006
  3. Ewan Kennedy

    Ewan Kennedy UKBF Contributor Free Member

    39 5
    One of the most common ways people waste money using Google Ads is by not having conversion tracking set up so that the value of the click is not quantified.

    £1 per click can be more expensive than £10 per click if you don't know what you're getting back from your £1 (other than a website visit).

    If you don't have online sales to track, make sure you are tracking something useful such as form submissions, calls, emails, downloads, sign-ups etc.

    The second most common reason for wastage - that I see - is a poorly structured account eg having only 1 ad group with, say, 300 broad match keywords in it.

    If you want to maximise control you might consider using SKAGs - single keyword ad groups, containing only exact match or phrase match keywords.
    Posted: Mar 15, 2021 By: Ewan Kennedy Member since: Mar 10, 2010
  4. makeusvisible

    makeusvisible UKBF Ace Full Member - Verified Business

    1,144 270
    To give some context to my answer below, and for transparency, I'm replying from the perspective of a digital agency owner.

    Ok, firstly, no disrespect meant in any way. But my advice is don't run a Google Ads campaign yourself. You have already indicated that your not fully knowledgeable about it.

    I have worked in the digital marketing sector for 10 years. I personally wouldn't dream of running a Google Ads campaign for myself or for a client, and I'm exposed to it every day.

    The reason; it's simply too complex a beast.

    I work in the same room as a colleague who manages our client Google Ads accounts. The way Google Ads works is changing constantly, and unless you are constantly researching, and learning, you cannot have a full handle on the capabilities of the systems, nor the potential pitfalls. Google Ads is designed to get you spending money. I know of no quicker way to leak cash than Google ads, other than standing at a petrol pump with your fist clenched.

    Over the years we have managed some hugely successful campaigns and still do. But I have heard literally hundreds of people come to us to discuss marketing over the past decade, who have said "google ads doesn't work". Those people had one thing in common....they had tried to do it themselves.

    That's not to say Google Ads can work for everyone, it isn't the right fit for every business. Leading onto your question about the budget;

    A Google Ads campaign (in fact almost any digital campaign) will never work month one, in the same way as it will month 2, 3, 6 etc. From month one you should have a target cost per conversion.... how much money are you willing to spend for every sale/lead generated. This is your target CPA.

    Your goal, is to reach that target CPA. So for example, if you set your target CPA at £50, and the average click is costing £1, that means that for every 100 people for click on your Ad, you need to generate 2 conversions.

    An ad campaign can only be improved by using data. So lets say in the example above your budget was £1,000 per month. That means you generated 1000 visits. You can now drill into the data, and look at which keywords generated the clicks, and which ads. You then need to analyse which keywords are converting the best. For example;

    Someone typing in "cheap diamonds" may convert at 20%, and someone typing in "buy diamonds" at 1%.

    To make decisions on which keywords are working, you of course need volume. You cannot even think about percentages, until you have several hundred visits, and the nature of PPC, those visits, and thus the data is going to cost you £.

    So in terms of budget, think about how much the average click costs in your sector, and then think about how many clicks you need in order to make rational judgments on the performance of specific keywords, ads and of course landing page of your website. A budget too low, and you won't have volume enough to make those decisions.

    Remember also with the above there are multiple streams of Google Ads. Above I am talking predominantly about Text Ads. A well-run campaign will also incorporate display ads, possibly shopping ads, and a remarketing campaign.

    To answer your original question; how can you reduce cost; You can reduce cost in the long run by investing in a properly run campaign initially, having solid conversion tracking, and ensuring you have the tools in place to measure performance, and the skill set in place to ensure that the campaign is adjusted based on data not intuition.

    Hope that helps.
    Posted: Mar 15, 2021 By: makeusvisible Member since: Jan 23, 2011
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  5. Fagin2021

    Fagin2021 UKBF Regular Full Member

    111 40
    There’s some useful advice above, but before you get into keywords, bids and budgets you need to think through a few things...

    What is the purpose of your advertising campaign? Is it to..

    - bring traffic to your website (national or local brand, product or service awareness)
    - sell a product, service or subscription off the site (Ecommerce)
    - collect customer details (contact forms)
    - generate leads (enquiry forms, telephone calls)
    - encourage footfall (eg. to stores or restaurants)
    - a combination of these things
    The purpose will determine the type of advertising campaign you run (Search, Shopping, Display, Video) which will impact costs and budget.

    How will you measure success ? eg...

    - number of website visitors
    - volume of sales
    - value of sales
    - number of leads
    - number of bookings
    If you don’t/can’t measure ‘conversions’ (an action arising from your campaign that you want to be taken) you’ll have no idea whether it’s working or not. Some conversions are relatively easy to track (eg. with code on a website), some harder (eg. telephone enquiries) but most are possible.

    How do you value a conversion ?

    Aside from simple traffic volume (awareness) you need to assign a monetary value to each conversion action. Sometimes it’s straightforward (eg. an ecommerce sale) but for other types of conversion you might need to calculate and assign a...

    - nominal value
    - average value
    - lifetime value
    Even an arbitrary conversion value helps you understand whether your campaign (down to keyword level) is producing an acceptable return.


    Make sure the place your campaign is driving visitors to (website/call-centre/customer service) is fit for purpose.

    Ok – now you’ve done the easy part!
    Posted: Mar 16, 2021 By: Fagin2021 Member since: Jan 27, 2021
  6. UKSBD

    UKSBD Not a real duck { Moderator }

    10,638 2,145
    finally - and importantly

    There is a reason why a well organised lead generation type company can make money on Adwords when a small local business can't

    Small local business may get 10 leads from an ad but only be able to service 2 or 3 of them.

    Well organised system will ensure all enquiries can be serviced by having someone to provide the service or by outsourcing it elsewhere and not wasting a click.
    Posted: Mar 16, 2021 By: UKSBD Member since: Dec 30, 2005
  7. Paul Carmen

    Paul Carmen UKBF Regular Full Member - Verified Business

    418 129
    This should be part of a marketing plan, as posters above have already said there are loads of elements to consider. Effectively, if you don't have a marketing plan, and an activation strategy based on this plan, then you're doing this the wrong way round.

    There's so much more than just keyword type and budget; if you don't understand match types (Google are dropping broad match modifier and phrase match now behaves in much the same way), negative keywords and buying intent, you will waste most of your budget.

    If you don't understand how to carry out relevant research to get a proper plan in place; e.g. customer, market, product, keyword etc, then you're likely to waste a lot of their money. You should discuss getting professional advice and quotes like you would with any other specialist work that's not the core business of your company.
    Posted: Mar 16, 2021 By: Paul Carmen Member since: Jan 27, 2018
  8. Larry Fong

    Larry Fong UKBF Contributor Full Member

    85 8
    You can start at a small budget and once you find the ads profitable, you can expand it anytime. I have a client he started a campaign with £5/day last month and he asked me to increase the budget to £60/day.
    Posted: Apr 2, 2021 By: Larry Fong Member since: Dec 16, 2020
  9. StevePoster

    StevePoster UKBF Enthusiast Free Member

    1,043 148
    Is it true that some of the competitors can abuse these ads in organic searches wherein they can easily abuse the clicks with the competitors ads and wasted all the consumable fund within the ad?
    Posted: Apr 10, 2021 By: StevePoster Member since: Nov 29, 2013
  10. Fagin2021

    Fagin2021 UKBF Regular Full Member

    111 40
    There's nothing to stop competitors from clicking on your ads. In theory, Google should identify multiple clicks from the same source and classify them as 'invalid' (ie. you don't pay for them). How well they achieve this is a matter of debate.

    More dangerous is running a display campaign where people may be paid to click on ads. Typically the 'clicker' visits one or two pages for just a few seconds before leaving.

    <rant>The worst offender for wasting your Ads budget is Google themselves. On the pretext of preserving user privacy they're making it harder and harder for you to monitor keyword performance and eliminate unwanted clicks.</rant>
    Posted: Apr 10, 2021 By: Fagin2021 Member since: Jan 27, 2021
  11. gpietersz

    gpietersz UKBF Ace Full Member

    1,994 481
    If you do run it yourself, turn off broad match, which is now the default or you will find your ends coming up for all sort of searches you did not anticipate.

    Also try with a small test budget so you do not waste much if it does not work well.
    Posted: Apr 11, 2021 By: gpietersz Member since: Sep 10, 2019
  12. Marketing Hub

    Marketing Hub UKBF Contributor Full Member

    35 3
    You need to make sure your online footprint is 100% before you start running ads. If it's not you are wasting your money
    Posted: Apr 29, 2021 By: Marketing Hub Member since: Apr 29, 2021