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Pay per click, or the process of paying for a click on your ad, has been said to be the marketer’s dream. The internet is awash with internet gurus telling businesses that they can pay some money and get clicks to their website. Then those clicks turn into leads, which turn into sales, while the owner can just sit on a beach letting his bank account grow by the hour.

I trust if you are reading this that you know that is far from the truth. I find it funny that the marketers out there telling you it’s true are also using 20 other marketing techniques to get that message to you.

So, how do you know if you need to use pay per click ads or not?

First, I need to say that I think PPC is vital in any marketing strategy. However, there are a few factors in early companies that we need to consider:

 

1. Do your products and the lifetime value have enough profit to warrant the cost of PPC? If you want help working this out, I wrote about how to work out PPC targets here.

2. Do people search for your product or service? Do people know your service exists?

3. What are your competitors doing?

 

PPC cost is rising. Knowing how many clicks turn into a lead, and how many leads you need to make a sale, will have a HUGE impact on if you should be using it.

Knowing the lifetime value of your customers is important too. Can you afford to market on an LTV? Meaning if a client stays with you for a year could you afford to wait until month 10 to break even?

So, it is essential to decide how you will base your ROI calculation. Are you basing it on how much the client will spend with you on the initial sale? Or will it be over a more extended period of time? As an example, if you were selling a gold necklace, it is most likely a one-time sale. So, your ROI would be based on that one sale compared to how much you spend to get that customer to buy your gold necklace. However, if you were a dentist then the client might initially only pay for a cleaning. But, this client will be with you for years perhaps spending thousands of dollars.

So, do people know about you? This really should be an essential question. It is surprising how many businesses still have a learning curve their clients need to understand about their products.

I recently worked with a company who has an excellent sales product. The problem is no one, and I mean none, knew his service existed. So, the problem faced here is people need to be educated about his solution before they can consider the option to buy; therefore, increasing the time to ROI.

What are your competitors doing? There are many tools out there like spyfu.com where you can see an estimate of what your competitors are spending on PPC. It can also tell you what keywords they are paying for as well.

 

Answering these 3 questions will let you know if PPC is right you for you. However, I will stress that PPC should never be your only strategy. There is a significant downside to PPC. It is a one time spend. Once you pay your $1 there isn’t any more use out of it. This is important to understand. Plenty of businesses take the short cut of PPC for fast results. Then they realize that they are unable to sustain the level of spending necessary. If you are only spending money on PPC, once you stop you vanish from everyone’s minds; unless you have a proper marketing and re-targeting system in place. Check out my post here where I discuss marketing techniques that work. 

Let me know what platforms you use and if you would recommend them. If it worked for you comment “yes,” or if it didn’t perform as well as you expected comment “no.”

 

Steve Goodall is a full-time digital nomad and an Iron Maiden fan who has spent the last 30 years working with business owners in driving company growth, restructuring internal operations and providing full consultancy on all platforms including branding, outreach, and marketing. Talking business is his THING… so connect with him on LinkedIn.

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