How to Drive PPC Budget Efficiency

Anyone who has managed an advertising budget will understand how difficult it can be. You can launch a campaign, see initial success and start to scale. However, looking at the results a month later, you can see that your costs have ballooned, leaving you with a campaign that you aren’t able to sustain.

The line between aggressive growth and inefficient spending can be a blurred one. Ultimately, with PPC, you need to be proactive but be sensibly so – you don’t want to burn through money for very little reward. The good news is that PPC is one of the most tangible forms of digital advertisement. PPC platforms like Google Ads can assess if your budget is being used effectively. You just need to know how to use these PPC budget management tools to know what levers to pull.

If you’re having trouble driving profit from your ad campaigns, we use a profit-first PPC Agency model. – ROAS looks good. Profit feels good.

 

 

How Can Your PPC Budget Be Used Effectively?

Your PPC account is a transparent ecosystem – with analysis, you can easily see what’s working and what isn’t. Insights from performance tracking and online analytics allow you to spot where the budget is wasted or mismanaged. Identifying what isn’t working can help you pivot towards what is, making your PPC budget as efficient as possible.

 

If campaigns are mismanaged, it can feel like you’re spending money for the sake of it, and that’s what PPC budget management helps to prevent. You can start making smart advertising investments, ensuring every penny contributes to growth strategies that help your campaign.

 

Budget Control

Effective budget management is crucial. However, it’s more than just setting a monthly PPC budget; it’s a constant, ongoing process. Much like PPC, your budget must adapt to shifting campaign dynamics. For example, you may find an easy way to cut the budget, which is to only use ad scheduling in certain time periods when your intended audience tends to be online.

Tactics like this give you a clear campaign structure by allowing you to see what ad segments are performing and which aren’t. From this, reallocating budgets from areas draining it to ones proving successful can get the most out of the money you’re putting into PPC. It isn’t about cutting your advertising budget; it’s about using it in the right way to make it as effective as possible.

Additionally, daily and lifetime budget caps can be established to ensure you aren’t overspending. These caps can be changed whenever needed, meaning the campaign can adjust focus when necessary.

 

Precise Targeting

This is one area where your PPC budget can get out of hand unless managed correctly. Showing your ads to millions of people sounds great on paper, but it only works if they are your intended customers! You may find that your click-through rates are down on certain campaigns, and this can be one reason why. Actual cost efficiency comes from targeting the right person at the right time in the right way.

It all starts with keywords. Targeting broad terms with huge search volume and high PPC competition isn’t always the right move, as it can be much harder to make an impact. Instead, focusing on high-intent keywords can improve campaign efficiency if you target ones that show the user is ready to buy. Tools like Google Keyword Planner can help, but you need to understand your intended customer to do this effectively. What are their wants and needs? Tools that can help you understand the psychology of your intended audience include Google Ads, Microsoft Advertising and Facebook Ads.

 

With remarketing campaigns, you can target based on many factors, such as demographics, past behaviour, and interests. Getting this right will improve the cost per click of your campaigns by targeting the audience that might buy your product.

 

Testing & Optimisation

A PPC campaign needs constant attention to achieve sustainable growth over a long period of time. As such, you need to test and optimise every component to improve performance relentlessly. Aspects you need to test include:

  • Ad Copy and Ad Assets: Test different headlines and descriptions to see which ones have the greatest impact. Check that your ad extensions give users the information they need to click.
  • Landing pages: A high click-through rate means nothing if your landing page fails to convert. This can be due to its poor user experience. Improve the quality of your landing page to see an increase in conversion rates.
  • Bid strategies: We recommend against setting up a manual cost-per-click strategy and walking away. Experiment with smart bidding strategies that use AI search and machine learning to ensure that you bid in line with specific marketing goals. This bidding system can easily be adjusted based on market fluctuations, which is why you always need to be alert for any changes that could impact performance.

 

Addressing these elements will improve your quality scores, which Google and other search engines use to reward high-quality ads with lower click costs and better positions on SERPs.

 

What Are Key Metrics for Successful PPC Budget Management?

When working out how to calculate a PPC budget, it’s vital to understand what the key metrics of a successful one are. Metrics that are crucial to having a successful PPC budget include:

  • CPC (Cost Per Click): This is a foundational metric for any PPC campaign, telling you how much you pay for each click. It’s generally considered that the lower the cost, the better. However, this shouldn’t be at the expense of quality. Focusing on the quality of traffic from PPC ads is essential to drive conversions.
  • Conversion Rate: This statistic shows the percentage of clicks that result in a desired action, such as filling out a contact form or purchasing. It’s a crucial indicator of the effectiveness of the landing page and your ad spending.
  • POAS (Profit on Ad Spend): Many paid search specialists focus on ROAS (Return on Ad Spend). However, it does have a blind spot: it doesn’t account for profit margins. As such, you could have a 5 x ROAS on a low-margin product and a 3 x POAS on a higher-margin one and assume that, because the former has a higher number, that it’s the better performer. That isn’t necessarily the case. By tracking actual profit, POAS is the perfect indicator for determining if your budget is working. It shows you the exact profit you are making with every campaign. By tracking actual profit, not just revenue, POAS aligns your PPC budget directly with your core business objectives.

Further reading: What does POAS mean?

A Real Example of An Efficient PPC Campaign

To demonstrate the effectiveness of these strategies, let’s examine one of our real PPC campaigns, highlighting the work we did with Crisis, the charity that tackles homelessness.

Crisis required optimisation of their AdWords account to make the most of the busiest time of the year, Christmas. Our strategy worked on three key processes: Analysis, Monitoring, and Remarketing. By conducting an in-depth analysis of the charity and what keywords it was focusing on, we devised ad text to increase the click-through rate by improving the relevancy of ads.

We monitored these results to see which ads were performing well and which were performing poorly. By constantly improving the keyword list, we utilised the best-performing keywords and ran a full paid search option to increase donations.

By testing different ads and rotating them, we saw a 20% increase in clicks, a 20% increase in conversion rate, a 61% increase in revenue, and a staggering 493% return on investment for those ad spends.

 

Optimise Your Campaigns to Keep Your PPC Budget In Check

PPC budget management is crucial for keeping your campaign in check. It’s about developing a disciplined, strategic approach. By establishing firm budget control, refining campaigns with precise targeting and learning to work in the shifting landscape by constantly optimising work, you can build a sustainable budget that can help you long term.

Want to know more? We can help you refine your PPC strategy to ensure it’s as effective as possible. Get in touch to assess your PPC budget and learn how we can help you get more out of your ad budgets.