PPC Costs 10% of Sales

[JJWinst]

I heard a turn of phrase the other day that said 'as a general rule of thumb 10% of sales is a regular PPC figure'

Is this true? I use google shopping and currently have a budget set up of £500 per month. I also pay someone to manage the campaigns. I'd like to know what would be a good result from my spending, or is it hard to calculate?

Our CPC ranges from £0.12-£1.00 PC.

 

[boring-friday]

Good result=any profit, plus you'll hopefully get returning customers.

too hard to calculate but no its generally more than 10% of sales

 

[stevebrownlie]

It's hard to calculate and will vary wildly depending on your site, conversion rate, prices compared to competition, advertising consistency, your brand (a recent study showed people who've seen you advertising on Facebook are more likely to click your results in Google results, even if they didn't click the Facebook ad...) and so on.

It may be the case (unless they're charging you £10/hour and get everything done in under 3-4 hours or something...) that paying someone to manage a £500 budget is not a good use of the budget.

Most of the benefit from hiring a professional comes from testing huge numbers of different versions of copy for different segments, landing page optimization and all of that kind of thing which is unlikely to be particularly possible with just a few thousand visitors to work with. Too little data - you'll find on that kind of budget you have good months and bad months without really changing anything, just natural variation.

 

[Tedwood92]

No. This is not right, every campaign is set up differently and every industry is different.

You have the below variables:

• Website conversion
• Average Order Value
• Average CPCs
• Margin

You should be looking at what a customer is worth over the long term and optimising for that. If you don't have that data, then work out a COS based on what your margin is and what you're comfortable with.