Posted by on Jan 13, 2013 in Blog, Marketing, SEO, Small business, Social Media |

Posted : January 13, 2013

Setting a budget for your marketing campaigns should be prepared before the end of year approaches so that you will be able to determine which marketing channel should have the most or the least allocation.

PPC or pay-per-click marketing is a significant aspect of marketing that you should focus on. You should know how to properly allocate your budget on this significant marketing channel so that you will be able to efficiently use your resources on pay-per-click marketing.

Best Practices in PPC Budgeting

  • Getting Started: How to Determine Your Initial PPC Budget

Determining the initial budget for your PPC campaign is kind of hard because you might not have an idea on how much you should allocate due to your unfamiliarity of the marketing channel. But by determining how much you should pay per click, you will be able to set your desired budget based on the amount of traffic that you want to lead to your site.

You can use various tools in determining the initial budget of your PPC campaign like Google Ads’ free traffic estimator. This tool will help you determine how much you should allocate to your PPC campaign by estimating the cost of the campaign from the cost of each click and the conversion rate of the website. This is not a 100% accurate tool but it will give you a decent estimate on how much you should allocate and how many conversions you can have form your PPC campaign.

But this will be nonsense if you are not able to determine the conversion rate of your website. You must determine the conversion rate of your site so that you will know how much your traffic that you have generated through PPC will convert into customers.

If you have found out that your cost per click is not too high and can still be profitable, you may allocate a good budget on your PPC campaign. But if the cost per click is too high and your conversion rate is low, you should test it out first and allocate just a small amount on your PPC campaign to see if things will get better.

  • Base Your Budget on Profitability

You should make sure that your campaign gives you a profitable return. If it is not profitable, you should focus on other campaigns that offer higher profitability than your PPC campaign. This way, you will earn higher profits without spending too much money on unsuccessful campaigns.

  • Don’t Arbitrarily Cap Profitable Spend

If your campaign is successful and provides high profit, you should not really bother limiting your budget on that specific campaign. Buy as much traffic as you can if your PPC campaign is giving you great profit so that you can have a more profitable business.

But be sure that you track the results of your growing campaign to make sure that you are getting the most out of your campaign. If you can get profitable results from a cheaper campaign, it is time to determine which one you should prioritize so that you can get high profits with the least spending.

  • Don’t Just Slash Budget from Unprofitable Campaigns – Optimize Them

If one of your campaigns is not giving profit, you should first think about the aspects of the campaign rather than just cutting down its budget. You have to determine what makes a campaign weak so that you can optimize it to make it provide higher profits rather than just blame your budget on the unsuccessfulness of the campaign. Make sure that you enhance the campaign first before you make any further decisions.

Limit your budget on unsuccessful campaigns while you are determining the problems so that you can save money and allocate them on more profitable campaigns.

  • Understand Your Business’ Seasonality

You have to determine the swing of your business so that you can effectively set a budget. You will want to allocate a bigger budget on months that are favorable to your business and tighten your budget on weaker months. This way, you will be able to avoid spending too much money on your campaign during months that don’t give too much profit.

  • Create Your Campaign Structure Based on Different Budgetary Controls

On Google Ads, you can control the spreading of your budget with the help of the proper segmentation of your campaign aspects. This is quite helpful because by appropriately allotting your budget based on different aspects of your campaign, you are able to allocate more resources to campaign segmentations that provide greater profit.

Some of the factors that you want to consider in spreading your budget properly are geographies, product lines and other settings like network targeting and device targeting. You may want to push certain budget on the aspect of the mentioned factors so that you can make your campaigns more focused on specific factors that greatly affect the structure of your campaign.

  • Test Accelerated vs. Standard Ad Delivery

You have to test whether accelerated or standard ad delivery is good for your campaign. Accelerated delivery means that your ads will be shown to your target audiences immediately while standard ad delivery will make Google reserve your ads so that they are shown all throughout the day.

You have to determine which ad delivery delivers more visitors to your site before you choose the kind of delivery you want your campaign to have. But if your campaign is already quite profitable, you can try accelerating your ad delivery and just put more budget to your campaign so that more targeted audiences will be able to see your ads all throughout the day.

  • Consider Breaking Larger Budgets into Multiple Campaigns

You might want to break up a campaign that has a large chunk of budget so that you can control your campaign more granularly. By doing so, you will be able to control your campaigns and make necessary adjustment to make your campaigns reap more agreeable results.

  • Leverage Impression Share Data to Identify Opportunities

Determine the impression data of your campaigns and make sure that you know which campaigns are losing impressions due to improper allocation of budget. By determining which campaigns can perform quite well but cannot give satisfactory results, you can push your budget on such campaigns and make your campaign better.

  • Remember: Your PPC Budget Isn’t Necessarily Your Google Ads Paid Search Budget

Even though you are having a successful campaign on Google Ads, you might still want to take a look at some of other networks that offer PPC so that you can determine which suit your needs and budget. It is not necessary to shift to other networks if you know you are reaping great results from Google Ads. But if you think that you can make things better and you can get more satisfactory results on other networks, don’t be afraid to try them.

Just remember to allocate only a little budget on your chosen PPC network at first just to test the waters. Only after you have established the profitability of the campaign you can set a bigger budget and allot more time to your new PPC campaign. This will make you avoid plunging into campaigns that will only make you lose money and make your campaign unsteady.


By Candy Lowe