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Why Pay Per Click Advertising Campaigns Fail for Small Business

by WarrenDuff Prodigy(October 2007) (rank 21st)
 
 
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business   click   cost   per   ppc   small

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(Note: this is an update on a article first posted on 19th September 2005 but is still relevant today). Many of the people I speak to in the course of my role and even socially, talk to me about their pay per click experience. I regularly hear that they are disappointed with the results and feel that the reality of running a PPC campaign fails to live up to the hype.

In my opinion, pay per click campaigns “fail” for two core reasons: 1. The campaign is too conservative; or 2. The campaign is too aggressive. By “fail” I mean met the massive sales expecations that they have when they start their campaigns. Conservative

What do I mean by conservative? Well in the course of setting up a PPC campaign, the user is given the task of selecting / creating: 1. Geographical distribution; 2. Number of keywords/terms to use; 3. Bid price levels/budget; and 4. Effective advertisements / descriptions; In any one of these areas, if the user who sets up the account is too conservative, then the traffic they receive will not reflect the true traffic potential. The user may now walk away from PPC thinking that it doesn't deliver the promised results of increased sales or visitors. The only saving grace here is that they probably have not spent a great deal of money, due to their conservative approach, other than their value of their time.Of course, because they have set their budget so low, they have also robbed themselves of the opportunity to make more money. Aggressive

On the flip side, imagine that the user sets up the same account and takes an aggressive approach on the 4 points above. What a difference this will make! The site will receive a lot of traffic but the expense of the campaign will outweigh the returns. This is usually due to the high level of poor quality traffic that such an approach generates.

Again the user may walk away from PPC advertising, with an even more bitter taste in their mouth, because they have spent (potentially) a great deal of money and time on the campaign. They will feel very jaded towards Pay Per Click advertising as they believe it generates a very poor return on their investment.

The Middle Ground

Is there a middle ground? Well yes there is as all experienced search engine marketers know. Unfortunately many of these have already dealt with the issues of being too conservative or too aggressive, but have finally found their patch of middle ground. They are also the people who persevere in the effort to get things right.The middle ground will be different for each industry and only through experience will a user know what this is.

However, most small business owner are not experienced Search Marketers and are not willing or able to devote the time to gain the experience needed to find the middle ground. So what are the options for them? 1. Give up on PPC and miss out on sales; 2. Outsource to a search engine marketing consultant; or 3. Consider a fixed traffic plan.
Each of these options has pros and cons. The flexibility and individual attention given by a SEM consultant is offset by the high cost. Option 3 is a fixed cost but doesn't necessarily provide the flexibility of option 2 and generally will have a higher cost per click. Option 1 is the easiest approach and unfortunately, the one I hear all too often. It all comes back to the comfort level of the user.If they are prepared to give PPC a go and work at it, then they can find their middle ground (either themselves or through a consultant).PPC is not a silver bullet, but it can be effective.
 
 

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Re: Why Pay Per Click Advertising Campaigns Fail for Small

Al-Scillitani
Vote:

October 2007

Great article.  It has to do with expectations and knowledge.  If the small business owner can not hire an experienced paid search person, I think they should read through the google learning center http://www.google.com/adwords/learningcenter/ read and ask questions in forums, and try to test and play with a campaign with a small budget.  Isn't that how most of us got started anyway? 

Once they feel comfortable in the interface and ROI, increase the budget and number of campaigns and keywords. 

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Re: Why Pay Per Click Advertising Campaigns Fail for Small

rene-lemerle
4.67 (Excellent) Vote: Interesting Interesting Interesting Interesting Interesting

October 2007

very true warren...the other thing that most advertisers don't realise, is that maintaining the balance (middle ground as you put it) is an on-going challenge. As PPC advertising is such a dynamic platform with competition and variables changing all the time - it's not as easy as finding the perfect mix of ad creatives, keywords, bid prices, scheduling, targeting etc etc and expecting that balance to remain...it changes everyday...so to be successful and ROI +ve is a perpetual process of review and adjustment.

also - i don't think this reason for failure is solely the domain of small businesses...i think any business can fall into the traps of being too aggressive or too conservative....this is article is good advice for business at all levels.
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