Google PPC Costs
Discussion
I own a web based promotional gifts business that uses Adwords as a sales generation channel. Our success with Adwords has been patchy but I am turning a profit. The volumes of traffic on promotional gifts are low but highly competitive. We all seem to think the other guy is getting the sales. To find out I rang around my competitors and all seemed to be in the same position.
My issue is that Adwords is consuming around 45% of gross profit of Adwords generated sales. Previously when running campaigns for Travel I expected to pay 25% of GP to Google, but 45% seems high.
I don’t know if approx 45% is now the accepted norm?
I own a web based promotional gifts business that uses Adwords as a sales generation channel. Our success with Adwords has been patchy but I am turning a profit. The volumes of traffic on promotional gifts are low but highly competitive. We all seem to think the other guy is getting the sales. To find out I rang around my competitors and all seemed to be in the same position.
My issue is that Adwords is consuming around 45% of gross profit of Adwords generated sales. Previously when running campaigns for Travel I expected to pay 25% of GP to Google, but 45% seems high.
I don’t know if approx 45% is now the accepted norm?
I own a web based promotional gifts business that uses Adwords as a sales generation channel. Our success with Adwords has been patchy but I am turning a profit. The volumes of traffic on promotional gifts are low but highly competitive. We all seem to think the other guy is getting the sales. To find out I rang around my competitors and all seemed to be in the same position.
My issue is that Adwords is consuming around 45% of gross profit of Adwords generated sales. Previously when running campaigns for Travel I expected to pay 25% of GP to Google, but 45% seems high.
I don’t know if approx 45% is now the accepted norm?
My issue is that Adwords is consuming around 45% of gross profit of Adwords generated sales. Previously when running campaigns for Travel I expected to pay 25% of GP to Google, but 45% seems high.
I don’t know if approx 45% is now the accepted norm?
I own a web based promotional gifts business that uses Adwords as a sales generation channel. Our success with Adwords has been patchy but I am turning a profit. The volumes of traffic on promotional gifts are low but highly competitive. We all seem to think the other guy is getting the sales. To find out I rang around my competitors and all seemed to be in the same position.
My issue is that Adwords is consuming around 45% of gross profit of Adwords generated sales. Previously when running campaigns for Travel I expected to pay 25% of GP to Google, but 45% seems high.
I don’t know if approx 45% is now the accepted norm?
I own a web based promotional gifts business that uses Adwords as a sales generation channel. Our success with Adwords has been patchy but I am turning a profit. The volumes of traffic on promotional gifts are low but highly competitive. We all seem to think the other guy is getting the sales. To find out I rang around my competitors and all seemed to be in the same position.
My issue is that Adwords is consuming around 45% of gross profit of Adwords generated sales. Previously when running campaigns for Travel I expected to pay 25% of GP to Google, but 45% seems high.
I don’t know if approx 45% is now the accepted norm?
Yes - I've engaged an agency to handle it as well as I am too busy quoting for work.
I've amended most adverts to feature a best price and the min order qty to prevent non target audience clicks. Started using price ranges so users can see we provide from low cost to high end items.
Use a full range of keyword variations and break poor performing ads out into own ad groups so they can be fine tuned.
The principle issue is the cost, it's just climbing all the time on Google.
The other issue is new comers. Had one a few weeks ago who piled in a No1 with no history. Rang him up in the end to ask how it was going. Told me he wasn't getting much but it wasn't costing much either. Told him he must be joking, he had to be spending at least £200 per day. He said he'd check with his agency - he's no longer advertising but it put the cost up for us all.
I just need to work out if the cost of working on Google is around £40 per order or around half of my GP.
If it is I'll need to amend my plans accordlingly
I've amended most adverts to feature a best price and the min order qty to prevent non target audience clicks. Started using price ranges so users can see we provide from low cost to high end items.
Use a full range of keyword variations and break poor performing ads out into own ad groups so they can be fine tuned.
The principle issue is the cost, it's just climbing all the time on Google.
The other issue is new comers. Had one a few weeks ago who piled in a No1 with no history. Rang him up in the end to ask how it was going. Told me he wasn't getting much but it wasn't costing much either. Told him he must be joking, he had to be spending at least £200 per day. He said he'd check with his agency - he's no longer advertising but it put the cost up for us all.
I just need to work out if the cost of working on Google is around £40 per order or around half of my GP.
If it is I'll need to amend my plans accordlingly
Hi John,
Having read your post your issues could lie with your landing pages. Ensure that they are optimised – so not too dynamic, have ‘meta’ keyword & description tags (yes they still count), H1/H2 titles, sub headings and sensible site navigation. In addition, I would check your robots.txt file and sitemap for any inaccuracies – one client of ours moved a robots.txt file from their development site, to the live one, thereby blocking all bots! It is also worth ensuring that the content of each page is unique (so no copy taken from the supplier website, and no copy strewn across several pages of your own site). The content should also contain the keywords and ad text of your ad groups (although not necessarily all of it). Improving the above will likely reduce the cost of running ads, but will also benefit your site within algorithmic indexes. Apologies if i'm preaching to the converted.
I agree Adwords has become increasingly difficult to work with of late, but jump through the right hoops and you'll pay very little. However, despite everything i've said above, an agency, even a mediocre one, should be able to drive quality traffic from Adwords for practically nothing. I can't say what our clients do, but a certain F1 website I run gets a vast amount of traffic on the keyword 'F1 Merchandise' for less than 2p/click.
I'd be happy to critique your site, (PM me) in exchange for information on the agency you're using and how much cash they're extracting from you (you see I like to keep an eye on the competition as well)!
Having read your post your issues could lie with your landing pages. Ensure that they are optimised – so not too dynamic, have ‘meta’ keyword & description tags (yes they still count), H1/H2 titles, sub headings and sensible site navigation. In addition, I would check your robots.txt file and sitemap for any inaccuracies – one client of ours moved a robots.txt file from their development site, to the live one, thereby blocking all bots! It is also worth ensuring that the content of each page is unique (so no copy taken from the supplier website, and no copy strewn across several pages of your own site). The content should also contain the keywords and ad text of your ad groups (although not necessarily all of it). Improving the above will likely reduce the cost of running ads, but will also benefit your site within algorithmic indexes. Apologies if i'm preaching to the converted.
I agree Adwords has become increasingly difficult to work with of late, but jump through the right hoops and you'll pay very little. However, despite everything i've said above, an agency, even a mediocre one, should be able to drive quality traffic from Adwords for practically nothing. I can't say what our clients do, but a certain F1 website I run gets a vast amount of traffic on the keyword 'F1 Merchandise' for less than 2p/click.
I'd be happy to critique your site, (PM me) in exchange for information on the agency you're using and how much cash they're extracting from you (you see I like to keep an eye on the competition as well)!
I know of some sectors where Google is taking 90% of the gross profits. This figure varies by sector, but 45% doesn't sound too bad to me. The problem is that Google is very greedy and wants a larger slice of the pie. They know (or think they know) which keywords are profitable and ramp up the minimum bid accordingly. If you're on speaking terms with your competition you could ask them all to reduce their bids a bit. If you can get the PPC costs down without hitting a minimum bid amount there will be more profit for everyone, except Google!
Edited by Webber3 on Tuesday 26th February 18:50
It's not that bad. We have spent years trying to optimise our website to suit Google. We now have a strong click-through rate and an aggressive campaign that is highly targeted to our main key words, but it still costs us about £25,000 per month. Google Adwords is by far our biggest single expense, but it's also our biggest traffic stream. Even though we are only a small company (10 employees), we have a dedicated full-time Google bloke!
We used to also run an Overture campaign, but found the conversion rate very poor. We would get the clicks, but not the sales. We found that click fraud was rife, paused our Overture campaign, but didn't lose any work!
We used to also run an Overture campaign, but found the conversion rate very poor. We would get the clicks, but not the sales. We found that click fraud was rife, paused our Overture campaign, but didn't lose any work!
Plotloss said:
[AJ] said:
£25,000 per month
Doesn't leave us much to spend on cars!
A large portion of it is caused by new comers who think they can come on with a huge bid. That pushes our costs right up, they vanish because they get a huge Google bill they can't pay and go bust, but then the next one comes along!
AJ your from North Wales 
You should come on my next hoon around the big country - should be end of march.
What type of business are you in?
The other issue I have with Google is the small order volumes. The customers tend to be small business or agencies looking to buy at the lowest price.
I have feeling that my industry isn't ready for the internet yet.
I know it sounds odd but customers in my sector might still be acustomed to traditional catalogues and don't use the internet for larger orders. The market online might be smaller than everyone thinks!
I have an idea that the first guys with websites did well and then everyone piled thinking it was all going online. That leaves everybody with a web site fighting over a small market that is pushing up Google Adwords costs. New guys appear and assume the top adwords companies are creaming it and bid accordlingly to find there is no market.
In essence everyone is selling online except the customer is buying offline.
You should come on my next hoon around the big country - should be end of march.
What type of business are you in?
The other issue I have with Google is the small order volumes. The customers tend to be small business or agencies looking to buy at the lowest price.
I have feeling that my industry isn't ready for the internet yet.
I know it sounds odd but customers in my sector might still be acustomed to traditional catalogues and don't use the internet for larger orders. The market online might be smaller than everyone thinks!
I have an idea that the first guys with websites did well and then everyone piled thinking it was all going online. That leaves everybody with a web site fighting over a small market that is pushing up Google Adwords costs. New guys appear and assume the top adwords companies are creaming it and bid accordlingly to find there is no market.
In essence everyone is selling online except the customer is buying offline.
Yeah let me know the details of your next hoon. I've been aching to get together with some of the North Wales lot. There are a lot of nice cars around here, but very few PHers. I was sure for a while that I was the only car nut in N.W. who knew how to use a computer!
Back to Google though, it's always a tough call. Our company specialises in products and services for the property industry and when we started our website back in 1999 it was early days and the market was very immature. The .com bubble had just burst and web businesses were not making any money at all. We kept at it and now we have a good foundation (although I feel we are still in our infancy). We learnt a lot of lessons along the way and made quite a few mistakes. Google change their PageRank algorithm all the time it's really hard to keep up with them. It's worth monitoring on daily basis. Check your keywords and make sure you're getting the clicks from the right people. We managed to save about £5k / month without losing any work by dumping some unproductive keywords.
You're website looks good although I notice that you can't actually buy online. Is this correct? That's something that I think you should look at. I'm sure you have your reasons for not doing so at the moment, but I wouldn't be surprised if you're losing a lot of the paid for Google traffic because of it.
Back to Google though, it's always a tough call. Our company specialises in products and services for the property industry and when we started our website back in 1999 it was early days and the market was very immature. The .com bubble had just burst and web businesses were not making any money at all. We kept at it and now we have a good foundation (although I feel we are still in our infancy). We learnt a lot of lessons along the way and made quite a few mistakes. Google change their PageRank algorithm all the time it's really hard to keep up with them. It's worth monitoring on daily basis. Check your keywords and make sure you're getting the clicks from the right people. We managed to save about £5k / month without losing any work by dumping some unproductive keywords.
You're website looks good although I notice that you can't actually buy online. Is this correct? That's something that I think you should look at. I'm sure you have your reasons for not doing so at the moment, but I wouldn't be surprised if you're losing a lot of the paid for Google traffic because of it.
It's my intention to add a buy online functionality - I've got the card processing set up but the I had to prioritise developments.
Building a web presence was the first 'Must Have', followed by adding products. At the beginning in October there was only one site offerring full ecommerce but this has changed in the last few weeks.
Loading products was initially done manually but I've now moved to bulk importing. Obtaining clean data from suppliers has been difficult. The big issue in create full ecommerce has been the delivery costs as suppliers in the main don't have the data available.
Another diificulty is deciding how long an adgroup can run without a sale. If I am expecting a 50% Gross Profit CPA at what point do alarm bells sound on an group with no sales?
I've had noticed that one one the major does tend to position their ads around position 6 insted of battling for top ranking.
Coyft would you mind dropping me a pm with the name of the company you met. If it's the one I am thinking of, it was either a Richard or Gareth you talked with.
Building a web presence was the first 'Must Have', followed by adding products. At the beginning in October there was only one site offerring full ecommerce but this has changed in the last few weeks.
Loading products was initially done manually but I've now moved to bulk importing. Obtaining clean data from suppliers has been difficult. The big issue in create full ecommerce has been the delivery costs as suppliers in the main don't have the data available.
Another diificulty is deciding how long an adgroup can run without a sale. If I am expecting a 50% Gross Profit CPA at what point do alarm bells sound on an group with no sales?
I've had noticed that one one the major does tend to position their ads around position 6 insted of battling for top ranking.
Coyft would you mind dropping me a pm with the name of the company you met. If it's the one I am thinking of, it was either a Richard or Gareth you talked with.
coyft said:
Google invited their top adwords customers to their headquarters in Dublin last year. I met a guy from your industry there, he had built his business from zero to £5m within 3 years, purely using PPC and had been offered £10m for his business. Some of it may have been bs but I doubt it. He would have been spending a minimum of 30k a month with Google to have been invited.
I think you need to be spending about £100k per month to be considered a top customer, that's when they give you an account manager. I know of someone that spends around £1m per month with them. Google is raking it in at the moment.Gassing Station | Business | Top of Page | What's New | My Stuff