8 Questions to Answer Before You Pay to Advertise Your Business
The following is a guest post from Susan Waldes, Senior SEM Manager at PPC Associates.
So you think your business is ready to get into paid advertising channels? Or are you into them already? In order to make sure you get the most out of every penny, here are the things you should think about (or should have thought about) first.
- Is your brand and site optimized? Meet Sally. She’s not ready to buy a tablet right now, but she’s been researching tablets because once she gets her year-end bonus, she’s going to buy one. Her boss has been talking about buying a tablet next week. She wants to impress him with her familiarity with tablets, so she tells him, “In my experience, Joe’s hyphen poorly hyphen designed hyphen tablet hyphen shop dot com has all the newest tablets, if you drill into that tiny link at the bottom of the page.” See where I am going here? Sally won’t even bother trying to communicate that garbled mouthful, and she won’t remember it either when her year-end bonus comes. Make sure you are memorable, easy to talk about, easy to find, and leave a good impression.It’s totally possible to make positive ROI if you are joes-poorly-designed-tablet-shop.com, BUT if you want to squeeze every penny out of the value of your paid advertising, you are going to get more return if you are tablets.com with a lovely, well-designed website all about tablets. There is some teeny-tiny value in every impression that your advertising gets and pretty substantial value in every click, even the non-converting ones. That value only exists if people both remember you and have a positive reaction to what they see.
- Do you know what defines success? Positive ROI is simple on the surface. If we spent $1 and made $2 in revenue, we’ve achieved positive ROI, right? Wait, our margin is only 30%; we actually lost money on that sale. Hang on, though – our average acquired customer orders from us five times over the lifetime of the relationship. We are profitable after all! Well, actually, that average is totally skewed because users in California order from us 10 times but this order came from Alabama, where customers generally only order once, so we lost money. But…we need to prove we can develop a user base of 10,000 people to get our next round of funding, so every acquired customer is really important right now…To some degree, the conditions listed above are things that you can work out and refine in the progress of optimizing your paid marketing, and I did push that scenario to the point of being ridiculous. However, knowing what success means for your paid advertising efforts is critical to getting the most out of the money you spend, and success can be a very complex issue. Before you start paying for clicks, think it out fully and deeply for your business and make sure you can communicate all the pieces to the people running your advertising campaigns.
- Do you have multiple ways to engage and reengage your customers? It’s great that your average customer orders five times, but why not shoot for 10? If you are paying for clicks, make sure that you also have a way to maximize the long-term revenue from these users. For many businesses, the long-term value is the tipping point between profitable and non-profitable advertising. How to do that varies by industry, but this probably means you should have a developed email marketing program, an active Facebook page, and a phone number with great customer support people answering it.
- Have you fully developed your funnel (and everything else)? Your design team finished a great landing page that is going to funnel folks right into leads, so it doesn’t matter that the rest of the site won’t be done until next month, right? Wrong. As much as those of us in the interactive advertising world would love it if every person were predictable and faithfully followed the funnel, the reality is that at least 20% of folks are probably going to break out of the path you have laid out for them. The most common thing to do is click on an ad and come back via a direct visit. If parts of your site are “broken” or do not help people get back into the funnel when they are ready to convert, you are not getting the most out of your ad spend. Make sure your whole internet presence is camera-ready before paying for clicks.
- Have you implemented all the tracking you need? Paid advertising should drive profit first, but there is a secondary value in the data you are collecting. The data is only as good as what you are capturing, though. Make sure before you launch you have systems in place not only to capture the metrics you want to see now, but the ones you think you may want to see later. Granted, you cannot always predict what those will be. However, it stinks to realize after you’ve spent $100,000 and met your CPA goals for that spend that it really would have been helpful to know that long-term revenue those users produced.
- Do you have enough cash? Some advertising campaigns are meant to be flighted. However, for your core campaigns, you want to make sure you can keep things rolling to benefit from the data. For some channels, like the Google Display Network with CPA target bidding, you can get increasingly improved performance just by algorithmic accrual of data. For others, like paid search, manual optimizations require the consistent collection of data. If you are constantly turning your ads on and off because you just don’t have sufficient cash flow to support them consistently, you are not getting all the performance that you can. Particularly if your sales cycle is long, making sure you have the cash to support your advertising while you wait for the revenue is imperative to scaling your business in a consistent manner.
- Can you iterate creative? “Wow! That Facebook ad hit the sweet spot and performed amazingly for three days, but we are seeing some ad fatigue. Can we get some new creative?”
“Sorry, we’re tied up for the next two months.”
Don’t get to this position. Whether you need to change creative for positive performance or negative performance, being able to quickly iterate when necessary is essential to display and Facebook advertising. Make sure you have the resources to support quick creative turnaround to maximize your success.
- Do you have a dedicated team member to serve as an industry expert to the marketing team? As a business person, you are probably pulled in a million directions, but when you are paying for visits, ignoring that particular direction is costing you money with each passing moment. You don’t want to finally answer the email a month (and $5,000) later with, “No, actually, our winery doesn’t want to pay for clicks from Utah because laws prohibit shipping wine there.” Whether you have an in-house team or you go with an agency, the people handling your paid advertising have a core competency of paid advertising (hopefully). That means that no matter how knowledgeable they become in your particular industry, they will always be one step behind what you know about your business. Making sure that you or a team member can serve as a constantly available person to answer questions quickly and represent your goals to the paid marketing team is crucial at getting the most out of your money.
You can have the best, most sophisticated SEM techniques and analytics platforms, but failing to answer any of the above questions before launching a full-borne campaign will seriously handicap your chances to get the most out of your efforts. It’ll take coordination across departments, but it’ll be worth it when everyone sees those consistently sparkling graphs in subsequent team meetings.
Susan Waldes is a Senior SEM Manager at PPC Associates, a digital marketing firm with offices in the Bay Area and downtown Chicago. PPC Associates does search, display, social, and mobile advertising for medium to large clients ranging from ecommerce to lead gen to EDU.