Before you can determine if Pay-Per-Click (PPC) product is right for you, you have to ask yourself a few questions. What are my advertising goals? How much is a new customer worth? How good am I at closing a sale? How many visits to my website convert into inquiries? If you can answer these questions, you can put together an ad campaign that will deliver a positive measureable return on investment.
The goal of any advertising is to get more business, but with PPC you can be very specific. You may want to grow your business in a particular geographic region, for example, as a vendor with a great local reputation, it might be time to market yourself in neighboring cities to reach a wider audience. Or maybe your venue is booked for weddings through the end of the year, but you want to appeal to other event-types to fill your space midweek. Whatever your goal, identify it and build your marketing campaign around that goal.
Warning: Math Ahead
With a goal in mind you can now determine how much a new customer is worth to you. In the most basic sense, a new customer is worth the profit you make from your relationship with them. For example, a DJ bills out $800 for an event and earns a profit of $400, then that customer is worth $400. But, investing the entire $400 towards getting that new customer is unwise unless you are a new business trying to build your brand, or you expect to get repeat business from the same customer. So, the value of the customer depends on your goal. But for argument’s sake, let’s say that our DJ is willing to spend half his profit, or $200, to get that new customer.
Closing the sale is never as easy as it sounds. With competitive leads, 5% is a good conversion rate. But with advertising, you’ve already captured their interest and it’s up to you to convince them to choose your business over the competitors they may be considering. If our DJ converts one out of every four inquiries into a customer – or 25% – he should be willing to pay $50 for each lead ($200 new customer value X 0.25 lead conversion = $50 per lead). And if his website converts one out of every 10 visits into an inquiry, we have determined that he is willing to pay as much as $5 per click to his website ($50 per lead X 0.10 site conversion = $5 per click).
Put Your Money Where the Traffic Is
There are several places you can spend your PPC advertising budget and the big search sites (Google, Yahoo, Bing) are the major players for your dollars. But keyword selection and bidding can be complicated. So complicated, in fact that there are a host of marketing management companies like Blue Corona whose job it is to make it easier on you. (Read the Blue Corona blog entry which inspired this article.)
A PPC platform like EventClicks takes the complications and the calculations out of the equation. Eventective delivers visitors who are looking for event venues and event-related services. If you are looking to grow your business in this sector, EventClicks can deliver visitors for only 25 cents per click. If our DJ above can afford to pay $5 per click to the big guys, how can he go wrong at 25 cents?
Whether you use EventClicks, Google AdWords, or a marketing management company, it’s up to you to find out where your customers came from. Ask the simple, friendly question, “How did you hear about us?”
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