Small spenders will fight an uphill battle in search, but that doesn’t mean that they can’t reach a profitable plateau

May 6, 2014: Marketers with a lot of money to spend on paid search tend to have an easier time than modest spenders. Buying lots of clicks yields lots of data which (if analyzed and acted upon correctly) can provide a crucial advantage over those who cannot afford to spend as much. Large PPC spenders can afford to run industry-standard tools and/or partner with agencies that can provide better execution.

So yes, small spenders are at a disadvantage — that’s just the way the search marketplace works. But that’s not to say that you shouldn’t go near search unless you have a $50,000 monthly budget. For purposes of this discussion, we’ll assume that you have only $1,000 a month to spend on search. How should you proceed?

1. Take Care of SEO First

Thoroughly analyze the competitive environment, keywords that are being used to generate profit, and give yourself an unforgiving site audit to smooth the conversion paths for your prospects.
Don’t buy any clicks until you have your website in order, and know as much as possible about how your prospects and customers are organically accessing your site right now. While it’s true that there isn’t as much visibility into this process as there was last year (due to the search engines’ increasing use of encrypted referrer data), you can still learn a great deal. Thoroughly analyze the competitive environment, keywords that are being used to generate profit, and give yourself an unforgiving site audit to smooth the conversion paths for your prospects. You might eat up your entire $1,000/month budget in this initial stage, but that’s OK: no self-respecting retailer would think of opening a physical store with a leaky roof or a slippery floor.

2. Start Strong With PPC

There’s considerable evidence that strong initial spenders pay less for clicks once their accounts are “rated” by the search engines in the same way that D&B rates credit-worthy companies.
Search engines want to see ads with high CTR rates right out of the gate.  There’s considerable evidence that strong initial spenders pay less for clicks once their accounts are “rated” by the search engines in the same way that D&B rates credit-worthy companies. Another benefit of not holding back your spending is that you’ll develop real data about which ads are most effective, where users are going, and whether they’re abandoning their journeys. Another reason for allocating enough money in this period is that you may still not know where your best customers are coming from. Beyond keyword selection, are there geographical areas where buyers are coming from that you’re under-serving? Are there time-of-day periods where more shoppers are buying than at other times of the day?

3. Pause and Adjust

Now it’s time to reconcile your initial assumptions about the kind of creative you needed to run, the kind of people you needed to target, and the degree of competitiveness in your marketing niche.
If your first campaigns are running in the black, pat yourself on the back. You’re either an extraordinarily gifted marketer or a very lucky one in a non-competitive business category. If you find yourself in the “loser” camp, there’s very little consolation in saying that “you’re not alone,” but that’s the truth. Now’s hardly the time to give up, however: it’s time to reconcile your initial assumptions about the kind of creative you needed to run, the kind of people you needed to target, and the degree of competitiveness in your marketing niche. The good news is that you’ve accumulated a lot of data from your search campaign — now it’s time to mine this empirical data so that it can guide your next effort. Look for flaws – and there will certainly be flaws in every campaign – that you can fix easily. Are your negative keyword lists sufficiently comprehensive to weed out non-converting clickers? Are you bidding enough for the searchers who will truly buy from you? Are your carefully-tuned landing pages really performing as well as you expected them to?

4. Learn and Perfect

Consider using some “stealthy” tactics that might allow you to outmaneuver competitors.
Plough back the data you’ve bought from the search engines to improve your results. If your results are very bad from a particular engine, consider allocating some funds to another engine entirely, at least to perform a test. At the same time, however, poor results may have less to do with the engine than changes in the competitive environment, for example, the fact that a competitor across the street has decided to launch a campaign that, while wasteful, is stealing all your traffic. Consider using some “stealthy” tactics that might allow you to outmaneuver competitors. When are your best customers converting? Where are they located? Perhaps there are segmentation techniques such as day-parting and geo-targeting that can “outgun” competitors in times or places when searchers are more likely to buy or convert.

If you’re nimble, know how to extract wisdom from your data, and don’t mind keeping “both hands on the wheel,” there’s no reason you can’t succeed at search, even on a small budget.

 

Didit Editorial
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