When it comes to Pay Per Click advertising, business owners are either overly hopeful or extremely confused. It is clear that advertising is effective, it is likely that you have tried advertising using Google Ads, spending money on ad clicks that never seem to convert. This proves that PPC is not the issue, the real issues are whether or not PPC agencies do a good job, and if hiring a PPC agency is worth the cost.
What is the cost?
Hiring a PPC Marketing Agency is not just spending money on someone to click on your ad, and this is not the value PPC Marketing agencies provide. To properly manage PPC advertising, agencies have to do the following: determine how to manage ad campaigns, determine which keywords to avoid/not avoid, and determine how to write ads/manage ad copy so that ad click rates are as high as possible. This is in addition to managing ad pricing, which is based on PPC advertising agency guidelines.
Most people do not realise the importance of this last point. Google Ads and other PPC advertising agencies reward you ads that are consistently being clicked on and purchased over ads that have not received activity for a few days/weeks. Ads that are not set and forget are, on the whole, more effective, which is ultimately the reasoning behind hiring an PPC agency.
The breakdown of the DIY argument
Any reasonably tech-savvy person can run their own ads, and there’s a reasonable argument for that. Google will even show you how to do it. Each step in their process is built for someone’s hand to be held. They also give you the tools you need to lose money fast. Experience is needed to maximise what you get for what you are spending. Most new Google advertisers will lose their entire monthly budget with nothing to show for it in a week.
You can be sure that someone is accountable for losing your budget when you hire a PPC marketing agency. They are spending your money each time someone clicks on your ad, and they are trying to keep that cost low and your sense of value high by creating negative keyword lists that keep your ads from showing up for searches that will never give you a positive return.
How the numbers should look
Here’s a simple way to look at it. It would be the case that the PPC marketing agency would have £500 in monthly management fees, and your monthly ad spend would be £1,500. That would mean £2,000 as the ad spend and agency management combined. As long as you have 2 or 3 new customers from that, it is already a positive return. For most service businesses, this is easy to achieve as the average order value is above a few hundred pounds.
True results will settle after a few months. The first month is usually spent understanding the metrics and analysing the ads. Things like how ads are pulling and where the budget is leaking. From month two and month three, a good agency should show you clear improvements in your cost-per-acquisition.
When it might not be the right move
There are times when it might not be the right move to hire a PPC marketing agency. If your monthly budget is under about £500, the management fee becomes disproportionately larger than it should be. The leads are also limited by the budget. If your website has serious issues that impact how it converts like unclear calls to action, slow site, and no contact form, then ads will just drive traffic to a dead end. Fix it.
The short answer
When businesses have a budget, a clear understanding of how much a new customer is worth and a website ready to go, it is reasonable to say that PPC should pay for itself. The question should not be if a PPC marketing agency does add value to the business. The real question is how much longer can you manage it without any results?