These slides were presented during the SEMrush webinar "Advanced PPC #5: How to Justify the Budget You Need for New Campaigns". You can watch the video or read the transcript here >>> https://www.semrush.com/webinars/advanced-ppc-5-how-to-justify-the-budget-you-need-for-new-campaigns/
Creator Influencer Strategy Master Class - Corinne Rose Guirgis
Optimize PPC Campaigns for Consistent Profits
1.
2. The Problem
Profitable PPC Campaigns
cost time and money
The person giving you
this money is nervous
The amount you need
is hard to define
(thus increasing their anxiety)
3. So what’s this Money For?
Stats to Optimize Campaigns so that you
consistently Return More than you Spend.
Campaign
Optimization is
Traffic you buy
brings the Stats
Success comes from using the
Stats for Campaign Optimization
Ads
Targeting
Proper Bids
Improving the Sales Funnel
4. Grew up in
Orlando Florida
Was one of Google AdWords
first 300 users
Somehow ended up living in
the North of Brazil for 6 years
Moved to Israel
in 2009
Fell in love with PPC
while working at Wix.com
Briefly Worked
at SimilarWeb
Founded
Quality Score
late 2012
About Me
Launch
14. The Stages
Understand how far you are from the Goal
Gage how quickly you can close the gap
Optimize towards 100% ROI
Scale campaigns to maximum potential
Optimize for Profit
16. Benchmark Period
10% of Budget
Benchmark CPC`s
Benchmark CVR ROI
ROI =
(Sales Value) x CVR________________
CPC
17. What it looks like
$2000 spend
ROI =
(Sales Value) x CVR________________
CPC
0.06% =
($100)________________
$5
Bottom Line
-$1,880
x 0.3
$100 Sale Value
CVR = 0.3%
Learn Essential Metrics such as:
CPC = $5
26. Profit Period
Find your Optimal ROI
Lower Bids
Lower CPA (Cost Per Acquisition)
ROI
Sales Volume will Drop
Lower CPC
+ Profits will Increase
Profit drops
Optimal ROI is found when
29. Ask for the right starting by understanding
the dynamics of the factors
Data Load
Data Cost
Risk Factor
Conclusion
Reduce Risk Anxiety by setting expectations
through the campaign life cycle
Benchmark Period
Growth Period
Profit Period
Success comes from using the stats for campaing optimization.
campaing optimization is:
ads,
targetting
proper bidsbids
improving the sales funnel
If your budget is $20,000 you should set aside 10% of it, $2000 as your benchmark period. Let’s assume for this example, that the value of a sale is $100.
Using this $2,000, we will understand the essential metrics that determine your ROI which are CVR and CPC . For this example, they are 0.3% and $5.00
Next we will plug them into the formula to determine ROI from these metrics. (click, show the formula)
Sales value, we already said is $100 (show sales value) Then, if we multiply it by our conversrate which is .3% and divide it by the CPC we’ve gotten, which is $5, we’ll calculate our ROI which is only 6%
Bottom Line You loose $1880
Improve
Conversion Rates (CVR)
Campaign Targeting
Funnel Conversion Optimization
Cost per clicks
Better Ads through A/B testing
Better Campaing Trgetting
For the benchark period, we spent $2000, found that our CVR was .3% with $5 clicks which produced a 6% Roi. We lost $1880 to understand where our stats fell.
Then we entered the optimization period which lasted another 5 weeks. Week is just an example. The more aggressive your budget, the less time needed. Could be days.
The first week, we improved our CVR to .5%, lowered CPCs to $4.50 which produced an 11.1% ROI and lost $1178.
For week’s 2 through 4 we continued to optimize. ROI increased weeky b week.
Finally on week 5, value per click finaly met cost per click and we were ROI nutural.
Grow PPC campaigns to maximum potential with natural ROI
Start with Optimization Pierod Slide – Animate to growth Period which shows last week of Optimization
After weeks of optimization and thousands of dollars lost, we reached an important milestone. We managed to optimize our campaings to where our ROI is 100%. (#show week 5)
Now that our campaigns are no longer a financial drain, we can uncap our budgets and grow. For the first week of the growth period we manage to spend #$4000 (show spend with the same #conversion rate and cost per #click as the previous week. Because ROI stays at 100%, our sales volume increases along with spend.
The Second and Third weeks show continue growth in spend. #(show Week 2 and 3 columns, all lines bu CVR and CPCs) However, there is a changing trend. #CPC’s go up, along with #conversion rates. The reason is simple. Expensive clicks are not your enemy. The opposite. IF you’re campaings are optimized for the right traffic, the clicks that tare the most expensive will be the most valuble ones. Now that we’re realizing that, we’re optimizing for it.
Finally, when week four comes along, we find htat we aren’t able to grow anymore with these campaings the way they are. Our campaings have neared their max potential. It is at this point, with the right adjustments we can move on to the profit phase where we will maximize our returns from this investment.
Now that our campaign and sales funnel is well optimized, the way to increase ROI is by # gradually cutting bids which will lead to lower cost per clicks. Thus we will achieve # lower CPA’s. …. #ROI will go up, and so will # profit.
However, #sales volume will start to drop so as will revenue. Eventually, #profits will start to decrease. When you reach that point, you’ve found your #optimal ROI for maximum profit.
Now I will show you an example. #The last week of the growth period found us at #100% ROI at a large scale. We managed to both spend and earn $20,000.
#First week of the profit period we lowered bids to where our average# cost per click drops from $2.60 to $2.50. Because CVR remains static, our #ROI and profits start to go up. Consequently, our ad spend goes down, as does our #revenue which drops at a slowed rate. We manage to make #$720 in this period.
The same trend continues. Proffit rises to $2727 for the second week and #$4,444 for the third. On the fourth week we find ourselves earning about $4,700 from $12,188 in ad spend at an ROI of 162%.
So we continue to cut bids. On the fifth week we find ourselves at #173% ROI, but something else happened. #Profit goes down! Why, because our salves volume dropped too low. (show entire graph)
So we have found our #optimal (make an optimal ROI label. Roi which is the point where Profit starts go drop even though ROI goes up.