We’ve definitely heard this one before. Here’s our short answer: it totally depends on your business and online set up. Google Ads can be an amazing tool that helps you grow your business. It can also be a huge waste of money if used improperly. So how do you know which side you fall on? Let’s see…
What are Google Ads?
Before you dive into a decision, it helps to understand how Google Ads work. Essentially, Google Ads are a way to buy your way to the top of Google’s Search results. It operates the same way as Google’s search engine always does; a user enters a search query and Google provides results based on their “question”. I’m currently in the market for a new baseball glove. I turn to Google to help me find one:
As you can see in the picture above, 3 lines of ads appear ahead of the first organic search result (organic = unpaid). The 3 companies paying for advertising include Source for Sports, Trio Hockey, and Sports Experts. Based on my search, Google determined that these 3 ads were the most relevant & had the sufficient budget to match. You can assume that for such a broad search, these ads likely out-bid a number of other advertisers.
This is because of Google’s auction system.
Here’s how the auction works:
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- When someone searches, the Google Ads system finds all ads whose keywords match that search
- From those ads, the system ignores any that aren’t eligible, like ads that target a different country or are disapproved based on a policy violation.
- Of the remaining ads, only those with a sufficiently high Ad Rank may show. Ad Rank is a combination of your bid, ad quality, the Ad Rank thresholds, the context of the person’s search, and the expected impact of extensions and other ad formats.” (source: Google Ads Help)
It is a pay per click system, and the cost per click depends on the variables listed in point 3 above.
Customizable Ads
Google is frequently changing the way your ads are presented to its users. You can promote individual products, drive them to your location, encourage phone calls, lead them to your website & more. Customize your ads in a way that best promote your desired outcome. Further, target your audience by playing with demographic settings, choosing your desired locations, choosing what times your ads run and more.
So, should you use Google Ads?
Evaluate Your Needs
The first thing you need to do in order to answer this question is evaluate your needs. What is the main goal you would like this ad campaign to help achieve? Are you trying to promote a product or service? Drive traffic to your website? Encourage people to visit your store? Maybe you’re just trying to spread awareness. Once you understand your needs, you can figure out if Google Ads will support them.
Provide Value
If someone takes action on your ad, will you have immediate value ready for them? People want an immediate return after clicking your ad. Make sure it is there for them. If it isn’t, you just wasted money. Sending someone to an “about” page with a vague description of your business likely isn’t going to generate much profit. Yes it is good to spread brand awareness, but there are more cost effective ways to do that.
Think About Return on Investment (ROI)
What is your average customer value? How much is a click worth to you? Google Ads tend to be more effective when you’re promoting high margin products where one purchase can make back your advertising investment. If your average purchase is $5 and you’re paying $2.50 per click, that is unlikely to be cost effective. BUT, if your average purchase nets you $500, paying $2.50 per click could be extremely worthwhile.
Consider your Competition
Research your competitors prior to investing into Google Ads. Enter search queries you’d expect your audience to be using and see what comes up. Are they big name stores that likely have a big budget? If so, you might end up with a high cost per click trying to out-bid them. Try niching down your ads to limit competition and avoid bidding wars on overused keywords. When you’re setting your Google Analytics budget, it will show you a competitor range for your ad. This is another useful tool for considering how much you may be paying per click. Unfortunately you’ll have to create an account and start making an ad to see this.
Give it a Test Run
You don’t have to pour your entire budget into Google Ads right off the bat. Start out with a lower budget and see what kind of results you get. However, there are a couple things you need to keep in mind. First, you should know that the first month always tends to be less effective. From our understanding, this is because Google’s algorithm is still learning and figuring out your target audience and what works best. You’ll often see a lower CTR (click through rate), meaning lots of impressions but only a small percentage of clicks. Secondly, you still have to make sure you are fully optimizing your ads. This means including call to actions, using relevant keywords, including engaging copy, using the right ad types, providing value & more.
Learn more about Google Ads
To learn more about how to fully optimize your Google Ads, give us a call at 647-334-2557. You can also subscribe to our newsletter so that you get notified when our next blog comes out. (P.S, it may involve some tips on how to optimize your Google Ads 😉) Thanks for reading!