Category: News & Trends

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Google AdWords – What Will My Click Cost Me?

This is the most pressing question most new Google AdWords clients want to know before they put money down for our services, or for that matter input their credit card with Google. There is a good tool that AdWords has online that will shed light on what you may pay. But the figures in this tool should be considered a guideline and not the real verifiable price you will pay when your account is rolling.

Here is one of the online tools you can use to check the anticipated cost per click:

Google AdWords Traffic Estimator

To use the estimator, enter your keyword phrase, then select (on the right in the sorted by section) columns, and then select in the drop down to show CPC (cost per click). The information that is displayed shows you searches on a global basis and the estimated cost per click. This is great for identifying, before you start with AdWords, the range of pricing you may pay.

It is crucial to understand that in my experience I have rarely seen a client pay what is shown in this tool as the typical cost per click. In reality the cost per click when the account is running will be higher – sometimes 20% higher or more. So, use the information found in this tool as a guide and not a rule.

Why would the cost per click in an actual running account be different?

There are several reasons: quality score, market competition, targeting settings, and real-time auction competition. Remember, AdWords is an auction and the auction prices are decided in real-time at the moment the search query is entered. The keywords tool certainly cannot take into account all of the above listed factors when it shows your estimated pricing.

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Google Explains the Name HotPot

Google sent me a note on Twitter when I tweeted about Google HotPot recently when I had blogged about it last week. Turns out there actually is a story behind this queer name they chose for their terrific new online review interface.

“Hot pot, the dish, is about community. You and your friends huddle together and add ingredients to a pot of boiling broth, creating a delicious soup to be enjoyed by all. Sometimes you take your own food from the pot, and sometimes you taste what your friends have added. This shared experience of gathering around a fire to cook and eat communally is a fundamental illustration of how we’ve come together to enjoy food from the earliest days of humanity.” Read the full article on the HotPot blog.

So it appears that the Google HotPot team is watching Twitter which that in itself is an interesting note. Okay I’m not sure I buy into the HotPot thing for food, who wants people double dipping into food you actually will eat, but the concept of sharing information on reviews, restaurants, businesses, hair salons, all makes perfect sense.

I like Google HotPot, it is similar to Four Square, but I like HotPot better as I can be at my computer updating Facebook and jot a note in HotPot. I don’t have to be on my mobile phone to write a review like you do with Four Square. The sharing aspect is cool and I am personally using it to write reviews for the local businesses that I use.

Even more interesting for me is that HotPot is integrated with Google.com and Google Places. So anyone who is in my HotPot group has their reviews shown on my Google.com searches and all HotPot reviews appear on Google Places. I think Google has a winner with HotPot, but here are a few names that I ask them to consider while they are at it: Stew Pot, Add to My Stew, Fondue It, Tell Me More, Crazy Spot. What weird and wonderful names can you think of? Just put them in comments below. Google appears to be listening.

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Know Your Cost Per Acquisition to Be Profitable with AdWords

To use pay per click advertising successfully you really need to know what your cost per acquisition is or rather how much you are willing to spend to get a new customer and still have profit left over. Without knowing your cost per acquisition, you can actually be paying Google AdWords for each new customer sale you make or each new customer your get. Google will work hard to spend your money, but it is your job to make AdWords profitable for you.

So, do you know how much it costs for each customer? How to you figure this out? A lead conversion in Google AdWords does not mean a sale. The formula for each business is different. One of my clients told me that for their business, it takes 10 leads to make a sale. Typically the higher the value or price of your service, the more lead conversions you will need to make a sale.

AdWords will track the lead conversions for you, but you need to track sales generated and each month look at the sales generated, total spent on advertising in all areas and then extrapolate to determine your cost per acquisition. In some cases when clients review this information they find which avenue is a better lead generator for their business or that one is more cost effective to use than another. Without this additional information and careful review, you may be spending more than you should on generating new business.

Once you know your desired or average cost per acquisition, Google AdWords has some excellent tools to help balance your traffic and cost per click to keep you within your profit restraints. The conversion optimizer with a maximum cost per acquisition setting is an excellent tool. You can balance what you want to spend with what Google recommends. Remember however that Google is in the business to serve clicks and you need conversions and sales so make sure that the setting you use does not stretch your margin too tightly.

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What is Your Website Traffic? What’s Low?

That’s the question everyone wants to know… is my website traffic high, low or in between. For small businesses that are not start ups and have been on the web for over a year, I feel that traffic under 50 unique visitors a day is low.

If your website figures aren’t even in the double digits on the average in a 30 day period, you really need to start working to build your website traffic. Why have a website if no one visits it and if it does not generate leads for you?

Here’s another benchmark if you have over 100 unique visits a day and you are a small business your traffic is definitely in the normal to good zone. Higher than that around 200 visitors a day and you are doing great. If you have 30,000 unique visitors a day, you’d better be on a dedicated server before you give yourself a big pat on the back.

So if your numbers are low what should you and what can you do to boost them. Here are just a few suggestions to consider:

  • Start blogging but only if you can install a blog under your own domain name on your parent website’s server. That is really key! Offsite blogging won’t help you in this area.
  • Think about writing and syndicating articles at Google Knol, Go e-articles, ezine.com and other sites. The key here to your traffic will simply be the quality of your writing and the timeliness of your content.
  • The easy path is to drive traffic to your website with Google AdWords or MSN adCenter (for Yahoo and Bing). When you don’t have time to do the other things this is very workable. Pay per click costs but the traffic you can generate immediately to expose the world to your services and products is well worth the investment. Just make sure you are targeted and don’t create a branding campaign that just brings your impressions and clicks.
  • Work all your angles! Do you have friends with websites on the Web? Get links back from them to your site. Consider doing guest blog writing. Tap into your network. If you are a member of a national or regional association ask if you can guest write for their online archived newsletter or blog. You want links and exposure.

These are just a few ideas to consider. Typically pay per click as it is the easiest is the route most people will pursue when they have little web traffic. Take some time to make sure your website is generating the traffic you need to feed your business.