Is Your SEM/PPC Marketing Profitable? | Primal 018

Is Your SEM/PPC Marketing Profitable? | Primal 018


On one question this week, we answer how do I know if my PPC search campaign, AdWords campaign, SEM
campaign is profitable? So if you’ve been in the
online space for a while, you know all about AdWords. There are millions and
millions of people searching using Google, especially within
Thailand every single day. So advertising on the first
page of Google, using AdWords, there are so many ways,
and so many advertising baht or dollars being spent
that’s being completely wasted. So how do we really identify
what keywords we’re using that’s really driving profit
or revenue for the business? So I really wanna introduce a metric that not too many people know of, which is EPC, earnings per click. So the premise behind
this is that you know what keywords are generating
revenue for your business, and it’s a metric that you
can work out fairly quickly if you’ve got the right tracking in place. And the idea is to really
look and optimise the account around sales, not conversions, but sales. So within service-based
businesses, you’re typically trying to generate leads
through your website or a landing page, or
through using AdWords search. And there are very few businesses
that I’ve noticed do this, but they’re not optimising
for the actual sales. So it goes from click, website, convert, or drive a conversion through
a lead-generation forum. Then it goes to a sales team,
and then that sales team has to close, and then
you generate the revenue that comes through from that sale. So how do we connect the dots
from click to final sale? So the answer to that is tracking. So making sure that your CRM
which is collecting the leads, and the sales that are
coming out, you need to be able to know which
sales are being generated from paid search, like AdWords. So if you’re able to, through your CRM, so at Primal, we’re a
HubSpot-certified partner, this is some of the things
that we do for our clients, whereby we know exactly what
sales they’re generating through HubSpot, because
it’s able to track which leads are generated
through paid search. And what we do is we collate
all that revenue data, and then we divide it
by the number of clicks that was generated during that time period to generate those sales. So what we end up is a metric
called earnings per click. So that’s the total revenue
derived from paid search or AdWords divided by the number of clicks within that given period. And what we can see is that,
if we’re paying, let’s say, 10 baht per click, on
average throughout the month, and we have an EPC figure of,
let’s say, 20 baht per click, we know that we’re generating
strong revenue from AdWords, without taking into
account profit margins. So if that figure beats
the CPC figure, or the cost per click figure, we know
we’re really generating value. So it’s quite an important
figure to take into account, especially if you’re a PPC specialist or you’re running an AdWords account for your brand or your company. So that revenue, you could even look at, and even if you didn’t
have that CRM to be able to pull through that kind
of accurate information back into AdWords, is you
wanna take a look at your lifetime value per customer,
so the LTV formula. So if you’re able to work that out and figure out, okay
well, how many customers, on average, do we get from AdWords? You can figure out that figure as well, multiply that by the LTV
number, you’ll end up with an estimated amount of
revenue for your company from AdWords, and you can work backwards in order to figure that out. So if you really wanna focus on AdWords driving strong results for the business, you’ve gotta tick a few boxes. And one of those is not
optimising for conversions, but optimising for actual sales. And you gotta ensure that
the tracking’s in place so that you can determine which keywords are generating revenue,
and then what you can do is cut down all of the
unnecessary spend being used on all the other keywords. They might be generating
leads for your business, but they’re not generating sales. So focus on the keywords that are getting your business sales. So that answers that question, hopefully. How can we ensure that AdWords is driving as much value for your
business as possible? Focus on EPC, not on conversions, but actual sales derived
from the platform. So if you enjoyed this video,
please leave a comment. It doesn’t have to be
a question, it could be just letting us know that
this is of value to you. But if you do have any
digital marketing-related questions that you believe
would be suitable for us to answer, please, on any of
our social media platforms, leave a question, and
hopefully we’ll pick it up in next week’s video. Thank you very much.

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