PPC budget strategy: Tips for success on a limited budget

By Tereza Litsa

You don’t need a large budget for an effective PPC strategy. Here’s how to maximize the success of your PPC campaigns regardless of the size of your budget.

The budget of a PPC campaign can play an important role in its performance. However, it doesn’t guarantee successful results without a proper planning first.

It’s common to believe that the bigger the budget for your PPC campaign, the better the results. But small businesses, or those without a lot of resource to allocate to PPC, may not always have the option of increasing budget. So how can you be as successful as possible with what you have?

This article will set out how you can manage your PPC strategy in a way that maximizes the benefits of your budget, no matter what its size.

Note: This article is an updated version of John Gagnon’s excellent piece, PPC Budget Strategy 101, and incorporates several of his insights.

Set clear goals for your campaign

Forward planning is critical when getting started with PPC. Having a pre-defined outcome for your paid search campaign will help you to avoid over-spending and incurring unexpected extra costs, so the first step is to set your goals.

Decide on what you’d like to achieve with your campaigns and how you’re going to achieve it.

Estimate your budget

Once you’ve set your goals, it’s time to decide on the initial budget that you’d like to use for your campaigns.

The first question is to decide on the number of leads that you’d like to gain through PPC. The answer should be aligned with your available resources and the goals you set in the last step.

The next step is to make sure that you’ve clearly defined what counts as a lead for your business before you start calculating the CPA (cost-per-action) to expect.

Wordstream has presented this process in a graphic that explains how your expectations for the number of leads and the conversions can help you determine your PPC budget.

For example, if your client goal is to gain 250 new ones per month and your current close rate is 15% with a cost of $25/lead, you will need a budget of $41,666 per month to generate 1,667 PPC leads.

In this case, a quick solution is to use your budget in campaigns that involve lower CPA to increase your chances of higher success.

Be strategic with the allocation of your budget

The next step is to aim for an improved CPA. A cost-efficient CPA helps you become more strategic with your PPC campaigns, and allows you to determine the most effective ads to apply your budget to.

If you want to lower the CPA, then you need to:

  • Increase your conversion rate (CVR), and
  • Decrease your cost per click (CPC).

By focusing on the best performing ads and lowering your CPA, you can spend your budget more wisely.

As always when calculating ROI, the higher the revenue when compared with expenditure, the better the investment.

You might now be wondering what steps you can take to increase your Go to the full article.

Source:: Search Engine Watch

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