Pay Per Click Return on Investment

No one wants to waste money, which is why it's important for online marketers to know when to stop an unprofitable pay-per-click (PPC) campaign. While the cost-effectiveness of many traditional forms of advertising are difficult or downright impossible to measure, PPC marketing is easy to track and evaluate. By carefully assessing your spending, ad clicks, and conversion rates, you can determine if a PPC spend is pulling its weight or if its time to "stop the bleeding."

Knowing When to Change

The metrics provided by advertising programs are a great place to begin your assessment. Some of the most important metrics to note are your total spending, eCPM, and CTR. If your total costs for a campaign seem to be outpacing the sales and earnings that are generated, it is time to conduct a more thorough assessment of your campaign management strategy.

Start by looking at your eCPM, or effective cost-per-thousand. This figure describes how much you are spending for every one thousand page impressions—the lower the number, the more effective your campaign. If you are spending a great deal of money to generate page views, it is time to reassess your tactics and adjust your PPC spend budget accordingly.

Before you change your ads, take note of your CTR, or click-through rate. If an ad or group of ads has a very high CTR, then you are obviously doing something right. You may simply want to adjust the content of your landing pages to generate more sales from your numerous page clicks.

Improving Your Return on Investment

Once you have decided to adjust a PPC spend, it's important to do it right. You need to determine what went wrong with the previous campaign and what steps can be taken to improve your return on investment for future advertising efforts. The great thing about PPC marketing is that it is flexible and easy to modify. The following are some of the best ways to ensure a successful PPC spend.

Hone your copywriting skills. Poor or ineffective ad writing is one of the top reasons why PPC ads fail. Focus on creating compelling ad titles that utilize keywords and calls-to-action.

Create great landing pages. The page a viewer sees once they click an ad is what will make or break a potential sale. Think of your landing page as a one page sales letter. You need to convey all of the necessary information a customer needs to hear, but in an attractive and compelling manner.

Adjust your keyword choices. Spend some time researching your audience to discover which search terms are important to them. An unsuccessful PPC spend might be an indicator of poor keyword choice, so always be sure your target terms are right for your advertising campaign.

Use Unsuccessful Campaigns to Plan for the Future

So your last PPC spend was a bust; now is your chance to learn a hard lesson that may actually help you in the future. There are always going to be ups and downs in online marketing, but you can use past mistakes to discover what does not work and adjust your future strategies accordingly. Never simply stop a PPC spend and move on to your next campaign. Pause for a moment to assess why your advertising didn't work and use what you learn to modify your current campaign or to plan a brand new advertising effort.

Effective campaign management accounts for both success and failure. By knowing when to stop an unsuccessful PPC spend, you can save yourself both money and frustration. When your investment exceeds your return, it is time to step back and reevaluate your marketing strategy. By using these past errors, you can hone your techniques and build a successful PPC marketing style.

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