Pay-per-click (PPC) advertising can be a fantastic way for businesses to reach new and existing customers, drive website traffic and increase conversions by placing adverts on search engines. Then, each time one of these ads is clicked, the company pays a fee.
The most common platforms for PPC are Google Ads (formerly Adwords) and Microsoft Advertising (Bing) with Google being the primary choice for many, reporting an estimated $209.49bn in ad revenue in 2021.
How Effective Is PPC Advertising
Done correctly, PPC advertising can be highly effective and drive outstanding results for your business. In this post, we’ve explained some of the reasons why PPC can be so effective, and other things you should perhaps consider before diving in.
Highly Targeted
PPC allows you to reach a massive number of super-relevant searchers, and you’re not limited by the people that follow you or the customer lists you’ve built as you would be with social media or email marketing.
You can reach specifically targeted audiences based on several factors, for example; search keywords, users that have already visited your site, searchers in certain locations and specific audience demographics. Not only this, but you can use negative keyword lists to exclude your ads from showing on certain searches, truly refining who sees your ads.
This means your campaigns are only delivered to the specific target audience that you’ve pre-defined, whether that be by keyword or more detailed targeting, giving you a much greater chance of a conversion and optimising your ad spend to reduce any potential wasted budget.
Quick
With PPC, the results come much quicker than with most digital marketing channels. Unlike a channel such as SEO, which can take plenty of time and effort, PPC can be up and running within a matter of minutes once your campaigns are built and ready. It’s therefore great for something such as a time-sensitive event, sale or limited-time offer.
With only a small amount of technical implementation required (tracking, optimised web pages etc.), PPC campaigns can be up and running quickly producing fast results.
It is, however, worth noting that although PPC campaigns drive fast traffic, you can expect to wait a little longer before it produces conversions on a large scale. Campaigns go through certain learning periods where they collect data and begin self-optimising (especially if you’re using automated bidding). Consequently, it’s usually around the three-month mark you’ll start to see real results.
Cost-Effective
With the majority of PPC campaigns, you’re only paying out money when someone clicks on your ad. It can therefore be highly cost-effective as you’re not wasting your budget on widespread, untargeted marketing that’s not delivering results.
You have the flexibility to manage the entirety of your budget across your campaigns, controlling the bidding methods that each of your campaigns uses, giving you control as specific as the maximum cost you want to pay for each click.
Measurable
When it comes to measuring the effectiveness of digital marketing, unlike more traditional marketing channels, PPC is a channel that’s extremely measurable and especially effective for attributing conversions.
Using the combination of Google Analytics and Google Ads provides you with accurate data on the performance of your campaigns so that you can easily identify which keywords and campaigns are driving tangible results for your business. You have the ability to drill down deep into the data focusing on performance metrics such as keyword performance, time of the day performance, which audiences are performing best and so much more.
This is especially useful when it comes to budgeting and working out the return on investment your PPC campaigns are generating. After all, you want the campaigns to be as profitable as possible.
Wide Reach
It’s estimated that Google handles around 8.5 billion searches per day and PPC ads in search results account for 45% of page clicks, so if your PPC ads are implemented correctly, it’s a vast potential audience to reach which could drastically increase the traffic coming to your website.
Purchase Intention
If people are seeing your ad, you know they’re already actively searching for what your business sells, and are much more likely to be interested in your offering. According to research, visitors that come to your site by clicking on a PPC ad are 50% more likely to make a purchase compared to organic search.
Due to the nature of PPC, you can choose to target users in different stages of their buying journey. You can serve ads to highly targeted bottom-of-the-funnel PPC keywords, or equally, you can serve ads to more exploratory keywords to drive awareness. If you’re opting for conversions, research shows that 65% of high-intent searches result in an ad click, meaning access to valuable clicks!
Complements Organic Search
Businesses may wonder whether to focus their efforts and budgets on Google Ads vs. SEO, however, PPC tends to complement a lot of other digital marketing activity very well and this is especially true with SEO.
An effective way to do this is to focus on PPC keywords that plug the gap left by SEO. For example, if there are certain keywords you’re not yet ranking for, it could be beneficial to serve ads for these whilst you build your SEO presence.
PPC can also provide a significant number of insights in relation to keyword data, you can discover clicks, impressions and conversion data for specific keywords and use this information to build out a solid SEO plan.
No Algorithm Updates
Unlike SEO, you don’t need to panic when Google releases an update. You can still maintain your position with PPC which offers far greater stability compared to organic search which tends to fluctuate a lot.
Increase Brand Awareness
PPC ads are a great way to increase brand awareness, in fact, they can increase your brand awareness by about 80%! This is especially important in industries where you may have other companies bidding on your brand name. For example, in hospitality, you’ll often find online travel agents (OTAs) bidding on hotels’ brand names.
When is PPC Not Effective
There are a lot of benefits of pay-per-click marketing but that doesn’t necessarily mean it’s the right fit for everyone. The reasons below don’t necessarily mean that PPC won't be completely effective, just perhaps a little tougher or more expensive.
Certain Industries
If your business operates within a competitive marketplace, you can expect PPC campaigns to be considerably more difficult and expensive.
After all, PPC is an auction, so you’re bidding against a lot of other companies, all competing for the same keywords, thus driving up demand and prices.
An industry such as legal services can expect an average cost per click (CPC) of $8.67 - the highest average expected - making it much more expensive to run successful campaigns. Similarly in the apparel/ fashion & jewellery industry, although you can expect a lower average CPC of $2.66, conversion rates are notoriously low (2.06%), which is worth bearing in mind.
Low Margin
If your business operates at especially low margins, PPC may not be the best channel for you. It’s stated that the average cost per click (CPC) is $1.16, this will obviously fluctuate depending on your business, but it gives you a good idea of what you could be paying for your clicks.
Poor Website
Driving a lot of traffic to a poor website isn’t going to help your PPC campaigns. Google takes landing page experience into account when calculating quality scores and therefore poor landing pages will affect the quality score of your campaigns.
Small Budgets
The cost of PPC can sometimes be reasonably high, especially if you plan to outsource to a digital marketing agency. These campaigns require knowledge to set up effectively and need to be monitored regularly as not keeping an eye on your campaigns can result in a lot of wasted budgets, hugely inflating your ROIs.
Overall
So, just how effective is PPC advertising? Done right, PPC can be very effective! Obviously, this relies on a number of factors - thorough keyword research, well-researched and built campaigns, regular monitoring and of course, a basic understanding of PPC and how it works.
If you’re looking for help with your PPC campaigns, get in touch with a member of our team to see how we can help!