One article will tell you that eCommerce pay-per-click, or PPC, is the best way to start generating traffic and revenue overnight.
Another – this one included – will tell you that it’s also the single fastest way to pour money down the drain.
It certainly can be, at least without the help of an eCommerce PPC services specialist. Here’s what to know.
How eCommerce PPC Works
In a nutshell, looking at this from a very high level, you pick a keyword for which you want your ads to show up.
Then you draft copy and assign a landing page, then you decide how much you want to pay if a user searches that keyword and clicks on your ad. This is called a bid.
Then, ideally, someone searches that term, your ad gets displayed, the user clicks, and makes a purchase.
You pay for the click, hence the name. In an ideal world, it is a good system, but it can become very expensive.
Keyword Targeting and Bid Strategy
The first thing that makes this complex is keyword targeting. You don’t want your ads displayed for too many keywords, because if you get clicks for them and no conversions, you still need to pay for the click.
The other thing is negative keyword targeting. There are some keywords that you don’t want your ads to show up for because they will cost you more.
Then there’s the bid strategy. If you’re not paying enough for your ads to display, they’ll never show up and you’ll never make any money.
If you bid too much, your ads will display, and you might even generate some revenue, but if you’re too aggressive, the bids will cost more than your revenue that’s coming in, which will destroy your return.
What They Don’t Tell You About Cost-Per-Click
Here’s another thing about eCommerce PPC, not just that you need to develop a coherent keyword and bid strategy.
The more competitors enter your market, the more you will need to bid to get your ads to show up.
If in year one you have few competitors, you won’t need to bid much on your keywords. If in year two, 50 more competitors enter your space, that’s going to complicate your bidding.
Not only will more competitors drive up your costs, but it might require you to go after other keywords that your competitors are not targeting.
Unless you’re working with an experienced, skilled eCommerce PPC services provider, it’s likely that it’ll be difficult if not impossible for you to figure out which keywords to target and how much to bid on them.
About Return on Ad Spend
One metric that can help you determine if your campaigns are on the right track is known as return on ad spend.
This metric tells you how much money you get back for each dollar spent on the campaign. If it’s less than one, you’re spending more money on the campaign than you’re bringing in.
If it’s above one, technically the campaign is profitable. As long as there are no other hidden expenses, you should be making money.
This is one thing with which an eCommerce PPC services provider can help you. The thing is, you just need to make sure that whatever revenue you’re bringing in is also covering the management fee associated with the service.
Hiring an eCommerce PPC Services Provider
All in all, eCommerce PPC services providers generally have extensive experience targeting keywords, assigning negative keywords, and developing an effective bid strategy that generates revenue without paying too much. This is the difference between making a little money with PPC (or losing it, for that matter) and making a lot. Get started looking for a qualified PPC partner today and start earning more.
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