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By Maria Annecchino. | July 24, 2017
You have a website and you need to generate traffic to sell your product or service. Perhaps you are asking yourself:
Should I use pay-per-click (PPC) advertising or stick with organic traffic? Will it be expensive?
Should I use Google AdWords?
Pay attention to what we would like to share with you so you can make a good decision.
Is Google AdWords expensive?
Many people think that it is indeed expensive. Others have tried to start a campaign without proper knowledge of how the platform works and in just a few minutes, they have spent a month’s budget.
Now you may be asking: If the cost-per-click (CPC) is between $1 and $3 per keyword, is it possible for Google to be profitable?
The CPC depends on many factors, but it’s important not to obsess over the CPC. What we have to focus on is how much you are getting back from those campaigns, that is, how much is being invested and how much return you are generating from campaign investments.
Imagine you are a small company and you only have $100 to invest in PPC advertising with Google AdWords each month. We’ll assume that the average CPC is $1. That can give us 100 visitors or 100 clicks from people getting to the site via promotion.
If we take into account an average conversion rate of 10%, it’s probable that those 10 people or visitors can leave contact information to ask for information or prices of your products and services.
Assuming that we have various products with an average price of $100, all you need is just one of those 10 interested visitors make a purchase and you have already paid for the cost of your advertising investment. If just one person makes it to your website and makes a $100 purchase, you will not be losing money.
If from those 100 visitors or prospects you get two sales of $100, each one would have a $100 profit. If you invest $100 and generate $150, although the costs can seem high, you will have a profit of $50.
Should you continue investing in Google AdWords?
The answer is very obvious. You are exchanging a $100 bill for $150 bill, and that is called Return on Investment.
Generally the CPC depends on the industry, the sector, and especially the campaign optimization. In addition to the level of competition within the market niche, the factors that most affect the CPC that are out of the control of the Google AdWords administrator is the Ad Rank. This is the value that Google uses to determine the ad position.
In order to determine this value, Google utilizes many factors: the keyword bid, the ad quality, and the relevancy of the landing page of your website.
Google recalculates the Ad Rank each time the ad is eligible to be posted in the auction of available positions. This and many more factors have to be taken into account to keep an account optimized for Google Adwords PPC and for campaigns to be profitable.
That is why it is extremely important when thinking about PPC advertising to consider hiring a company duly certified by Google Partners for AdWords account administration.