Google Ads is an online marketing platform that provides businesses of all sizes with the opportunity to advertise their products and services to the hottest prospective buyers on the internet through their Google Search, YouTube, and Google Display Network placements.
In this article, we explore how to get the most from your marketing budget by making your Google Ads campaigns go further, including how to calculate and lower your cost per lead (CPL), and how to plan for Pay-Per-Click (PPC) spending.
These tips are normally closely held within the Owendenny Digital Search Marketing Team, and they will help you optimise your campaigns, cut costs, and maximise your return on investment. Let’s dive straight in!
How To Lower Your Google Ads Cost
Google Ads is a powerful marketing tool that can generate a significant amount of traffic to your website. And – like any discerning business owner or marketer – the one thing we hear time and time again from our clients is that they want to make their budget stretch further.
But – before you get straight into the nitty gritty within the Google Ads platform. You must ask yourself this simple one, worded question:
Why?
Why ask why, you may ask. Well, here’s the thing that so many marketing gurus out there fail to understand.
When you are constantly on the hunt to reduce your marketing costs to make your budget go further, you – more often than not – do the opposite. That is, to eliminate all the good work that you’ve already done.
How is this possible? Well, it’s pretty simple. If you chase cheaper leads, cheaper phone calls, and cheaper conversions for long enough, you end up with a lot less quality leads and conversions than what initially started out.
The goal of this post was to bring awareness to the fact that cheaper does not necessarily equate to better – in terms of marketing – and it should be used sparingly if at all.
It’s always best practice to make sure that you are not sacrificing quality for the sake of cost. Constantly evaluate and measure your campaigns; are they proving to be effective? Are you achieving the desired results? If so, great! Stay on course – don’t get tempted by cheaper alternatives that may not be as effective.
Now, without our experience-tempered word of warning out of the way, let’s dive into the key cost metrics you may want to consider starting with Cost Per Lead – or CPL for short!
What Is The Cost Per Lead (CPL)?
Looking at the metric itself, it seems pretty simple to understand. The Cost Per Lead metric measures the cost of acquiring new leads through your advertising campaigns – and in this case, we mean your Google Ads campaigns.
It’s calculated by dividing the total cost of your campaigns by the number of leads generated.
For example, just say you’re a B2B SaaS in the Artificial Intelligence Creative Space, and you spend $5000 and generate 100 leads from your Google Ads campaign.
What this means is that your Cost Per Lead (CPL) is $50, as you paid a total of $5000 for 100 leads.
You simply calculate your CPL by dividing the cost of your campaigns by the number of leads generated.
This metric helps you determine how much it costs to generate each lead in an advertising campaign and provides insight into how effective your campaign is at generating leads.
When your Cost Per Lead is really high, this can be caused by many factors including (but not limited to):
– Poorly targeted campaigns
– Lack of campaign optimization
– Poor landing page experiences
– A bad offer
– Awful Google Ad copy
– A wildly competitive industry
…. Plus a whole lot more!
What’s a good cost per lead?
The ideal CPL varies depending on your industry, target audience, and ad format.
Simply put – there’s no right or wrong here. All that matters is whether you believe spending $X per lead to acquire a customer for $Y who spends $Z over his lifetime as a customer makes sense to your business.
If not – well, then you might need to keep on reading.
On average however, a CPL of $5 to $50 is considered a good benchmark for most businesses. This does depend on the type of lead (is it marketing or sales qualified, are they booked into a calendar of a sales rep, did they sign up for a free resource, etc) which of course affects the CPL.
It’s important to benchmark your CPL against your industry, the type of lead you’re trying to generate, and the Google Ad strategy you’re using to generate them.
How to Lower Your Cost Per Lead (CPL) in Google Ads
Providing your lead quality doesn’t fall off a cliff, it’s important to optimise your cost per lead in Google Ads because it will help you save money on your advertising and help your business grow for less.
When your cost per lead is lower, you get more leads for the same amount of money, which means you have more people in your CRM who know about you, what you have to offer, and who are interested in working with you and your company.
And – the best part – more people for your SDR’s, sales reps, or business development team members to have a go at turning them into customers!
The Top 6 ways To Reduce Your CPL In Google Ads
1. Use Negative Keywords:
Identifying and using negative keywords helps ensure that your ads only appear when potential customers are searching for relevant, related topics. This will help you avoid wasting money on clicks from people who don’t want or need your product.
2. Optimise Your Ad Copy:
Writing effective ad copy is key to attracting and engaging potential customers. Make sure your ads are clear, concise, and focused on the benefits of your product or service.
3. Focus on Quality Score:
Quality score is a measure of how relevant and useful users find your ads. Increasing your quality score is one of the best ways to lower your CPL, as Google rewards high-quality ads with lower costs.
4. Take Advantage of Automation:
Automated bid strategies such as Enhanced CPC or Target CPA help you optimise your bids automatically and ensure that you are always getting the most out of your ad spend.
5. Utilise Remarketing:
Setting up a remarketing campaign allows you to target people who have already visited your website or interacted with your ads. This makes it much easier to convert them into paying customers, as they already know about your business and/or product. These can take the form of YouTube Campaigns, Search Campaigns, and Display Campaigns.
6. Test Different Ad Formats:
Different ad formats can be more effective for different campaigns. Try testing different ad formats to see which ones perform the best and then optimise your campaigns accordingly. It’s all part of the fun!
What Is A Good Monthly Budget For Google Ads?
“How long is a piece of string?”
Don’t worry – we’ve got you.
The amount of money you should spend on Google Ads depends on your industry, target audience, and goals.
Generally speaking, a good monthly budget for Google Ads is anywhere from $1,500 to $10,000 per month.
However, if you have a limited budget or are just getting started with Google Ads, it’s best to start small and work your way up as your campaigns become more successful.
At Owendenny, we recommend our clients start with a Google Ads budget no less than $1,500 AUD per month (or $50 per day). This enables our Google Ads specialist teams to run simple tests, gain valuable insights, and execute the most effective strategies to drive meaningful business growth in your company.
Google Ads Budget: Planning for PPC Spending
Word of advice: Don’t make it up as you go. It seldom – if ever – works when it comes to achieving your goals using Google Ads. You need a specific plan that outlines your goals and how you’ll reach them.
When it comes to setting your Google Ads budget, one of the most important factors is knowing what you can afford to spend on a monthly basis.
Start by calculating your total marketing budget – including other marketing channels like SEO or Social Media Advertising – then allocate an appropriate amount for Google Ads. Make sure to account for things like your cost per click (CPC), keyword bids, and any other costs associated with running your campaigns.
When it comes to making your dollars stretch even further, we’ve developed a 12-step approach to help our clients and customers maximise their Google Ads budget.
Start reading it on the next line.
12 Ways to Make The Most Of Your Google Ads Budget
Below is the Owendenny Digital step-by-step guide to help you plan and make the most of your Google Ads budget:
1. Define Your Objectives:
Start by setting clear goals for your Google Ads campaigns. This will help you determine the amount you need to spend to achieve your desired outcomes.
2. Identify Your Target Audience:
Knowing who you want to reach with your ads is crucial to success. Consider factors like interests, demographics, and behaviours to find the right keywords and ad placements for your audience.
3. Establish Cost Per Lead:
Understanding the average cost per lead for your industry is important for effective budget planning. Keep in mind that this cost can vary depending on the industry and competition.
4. Set Your Monthly Budget:
Based on your cost per lead and goals, determine a budget that works for your business. This budget should account for ad spend, keywords, and ad placements.
5. Keyword Selection:
Choose keywords that align with your target audience and goals. Long-tail keywords tend to be more specific and cost-effective compared to broad, general keywords.
6. Ad Placement:
Select ad placements that are relevant to your target audience and goals. Options include search networks, display networks, and YouTube.
7. Create Engaging Ads:
Use visuals, clear ad copy, and strong calls-to-action to create effective ads that resonate with your audience.
8. A/B Testing:
Test different elements of your ads, such as images and ad copy, to see what resonates best with your target audience.
9. Results Tracking:
Regularly monitor the performance of your Google Ads campaigns to see how they are impacting your goals. Track conversion rates, ad spend, and return on investment to make informed decisions.
10. Make Fortnightly Adjustments And Optimisations:
If your campaigns aren’t delivering the results you want, make adjustments to your strategy. Try different keywords, ad placements, and ad formats to see what works best.
11. Utilise Google’s Analytics Tools:
In addition to third-party analytics, use Google’s built-in tools to gain a deeper understanding of your ad performance and identify areas for improvement.
12. Embrace A Culture Of Continuous Improvement:
Regularly evaluate and refine your Google Ads campaigns to keep them fresh and effective. Test new strategies and make adjustments as needed to stay ahead of the competition.
Summary:
Google Ads is an effective way to reach your target audience and drive results.
In fact, it’s one of the most effective ways our Agency helps businesses just like yours unlock new sales opportunities all over the world.
To make the most of your Google Ads budget, it’s important to plan and set clear goals for your campaigns.
Begin by identifying your target audience and setting a monthly budget that works for your business. Research relevant keywords and ad placements to ensure you’re reaching the right people.
Use A/B testing to optimise your ads and take advantage of Google’s analytics tools to track performance.
Finally, don’t forget to continuously refine your campaigns for maximum impact.
Need a hand when it comes to making your Google Ads campaign drive predictable revenue growth in your company? Book A Free Growth Diagnostic with Owendenny today and our Specialist Team will help you get the most out of your Google Ads budget.
With Owendenny, you’ll gain access to our team of experts who can help unlock the potential of your campaigns and bring cost efficiency to even the toughest marketing challenges.
We’ll analyse your current setup, explain what is working and why, and provide actionable insights to help you achieve success. Get started today and see how Owendenny can help your business grow!
