Predict The Success Of PPC Campaign
Is it possible to calculate the success of a search marketing campaign in advance? Yes!
As an example, a potential client said, "We've got $2500 per month to spend on clicks with PPC. Our goal is $100 cost per sale or less, and we typically close 70% of our leads."
What can we do with this basic information? More than you might think!
1) First, calculate how many sales per month the clients would need to meet their cost per sale goal: $2500 ÷ 100 = 25. So, 25 sales would be the client's minimum target.
2) Calculate how many leads the client would need to make those 25 sales at a 70% conversion rate: 25 ÷ 70% = 36. The client would need a minimum of 36 leads per month.
3) Now, figure out how many clicks the client can expect using their $2500 budget.
Begin by using Google AdWords' "Keyword Tool" to generate a subset of relevant keywords. (We started with 180 in this instance.)
Next, download the keywords into Excel and load them into Google's "Traffic Estimator," using the $2500/mo. budget. Play around with different maximum CPCs (cost per clicks) and see how the results vary. Raise the max CPC and the average ranking increases, which can generate more clicks. Paradoxically, it can also generate fewer clicks since each click is more expensive and your budget buys fewer total clicks. In the above example, we found a "sweet spot" of $1.50 max CPC that generate the most clicks - 1290. (Note that Google estimates the actual CPC paid will be lower - $1.13).
4) Assuming the client achieves 1290 clicks, calculate what the conversion rate would have to be to generate the necessary 36 leads: 36 ÷ 1290 = 2.8%
5) Evaluate whether the resulting conversion rate (2.8%) is realistic given the client's industry.
If you are really paying attention, you will have noticed that if the CPC is actually $1.13 and not $1.50, the client should be able to buy 2200 clicks instead of 1290. If that's the case, we could add more keywords to the campaign's subset to help reach this goal. The good news is the client would then need a conversion rate of only 1.6%
Bottom line, with just a few basic pieces of information and rudimentary algebra skills, anyone can fairly quickly tell whether or not a search marketing effort will be a success. As a search marketing provider, we know what numbers to target and our client knows what to expect. It's a win-win (and doesn't even require statistics or calculus)!
Stacy Sutton Williams is the Founder and President of Prominent Placement, a full-service, award-winning Atlanta search engine marketing firm, formed in 2001. An expert on internet marketing solutions, Stacy is sought after nationwide as a regular speaker on search engine marketing, and is frequently published on the subject. For more information on Prominent Placement's approach, visit our Services Overview page.