Have you ever wondered why Google Ad Words make up such a large proportion of the overall profit of the company?
The simple answer is because it’s self serve rather than on the advice of an expert advertiser and because of this a vast majority of business owners are paying far more than they need pay to get the same results. Based upon available knowledge plus the experience of our company the number of advertisers paying more than they need pay is probably over 80%.
So how does this happen? Basically as a business owner you know that Google ads bring enquiries from potential customers and you need a constant flow of new clients to keep your business alive. You set a daily budget that your business can afford, write a simple classified type of ad and wait for the inquiries to roll in. But have you ever thought that you could get up to double the number of inquiries for the same cost if only you knew how to do it properly?
Google Ad Words Economics
Most advertisers are of the opinion that the higher you bid for a given keyword phrase the higher your Google Ads appear and therefore the more people will contact your business. Nothing is further from the truth, your competitor, whose ad always seems to appear above yours, is probably paying much less per click than you in Google Ad Words.
To explain that we have to look at Google and Bing as a business overall: Each has millions of users, among who are thousands of people living in the catchment area of your business; these are the ones you wish to target.
The search engines have a duty to make the visit of their clients a good and useful experience. This means that when they enter a search term (keyword phrase) the page they go to will meet what they’re seeking. For instance you landed on this page because the search term “Google Ad Words” was of interest to you. Assume you clicked on one of our Google ads for this keyword phrase and the page you landed on gave poor quality information and didn’t answer the questions you may ask? The simple answer is that Google or Bing’s client is now unhappy and this reflects back on the search engine reputation.
It doesn’t matter how much you pay per click the search engine is not going to give your pay per click ads a good listing. Plus you will have to pay a high price per click to be seen at all.
Google Ads Cost
Assume your competitor who always seems to get top listing and first choice of new customers have their ad send you to a professional information page that meets all criteria set by the search engines. It offers readers information of value before sending them to a call to action page.
Then simple economics comes into play. Readers don’t like the page your ad sends them to so they won’t deal with your business. Lesson 1: The quality of the page you send them to is seen as a mirror image of your business. The search engines know this so they rank the page you send them to. Get a high rank and your clicks cost less. If your page ranks low the clicks cost more.
Business “A” is paying $20 per click but getting just two clicks each day. This means the search engine will only receive $40 each day from Business “A”.
Business “B” sends people that click on their Google Ad Words ad to a true value for money page that gives the visitor a good impression of the business, without giving the impression of being a money grabber, would probably get at least 20 clicks per day and only be paying about $5 per click. To the search engines this means an income of $100 per day From Business “B” compared to $40 from Business “A”.
Assume both businesses convert clicks at 10%, this translates to two new clients per day for business “B”, while business “A” will get one new client every 5 days.
We understand that you are not expected to fully understand how this works because your knowledge is your line of business, other people specialize in online advertising and they understand the demands of Google Ad Words.
Contact us for an obligation free Ad Words audit at zero cost to you.
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