While it may seem like a puzzle, and in fact it is sort of a puzzle, it’s actually not that hard to do.

See, there are a few possible ways to reduce PPC cost: you can improve your quality score (takes a long time, but you never will know if you are heading in the right direction or not), eliminate all competitors (if you are Neo from the Matrix, or Superman, this is always an option), or you could switch all of your PPC traffic to Bing (but then you will get only 1/20th the traffic.)

For the rest of us, the start of the solution could be the realization that the big-name national agency that someone hired two years ago (“because no one gets fired from IBM”) has not given you their A team or the B team or the C team, but more like their Z team (even though you pay like you have the A team)

The reality is (as someone who was part of an excellent global agency), it is not the agency, but it is which team in the agency you are working with.

If the agency keeps telling you “the best recommendation from Google to solve for that is to let their AI do the work”, then you know it is time to make some adjustments. I love Google, and I love the Google AI, but trust me: Google AI can’t solve everything. (If it could, we would have answered world hunger and poverty by getting the AI to invent the flux capacitor for every household and would not have to worry about marketing investments or ROI.)

But we live in the real world.

The answer is pretty simple: break out the account into smaller chunks to understand the strategies with the highest cost per click. Is it non-branded ads? shopping ads? DSA ads? Within the branded ads, is it category 1 or 3? Then do some tests with the lower CPC KWs to see if the current impression volume is low enough. If so, this means you can shift the investment from the high CPC keywords to low CPC keywords.

Of course, many of you well-versed PPC marketers are asking right now, what about ROAS? Well, see, now you are talking about a KPI where it makes sense for any advertising platform to do really well, correct? A CFO at a top 5 B2B retail once told me that if he added up all the revenue that these ad platforms reported, our company should have been 10 times the actual size.

Meaning, ROAS is a result of all marketing working together, not just PPC.

Going back to our story, lowering CPC and doubling the PPC traffic yes lowered the ROAS, but in aggregate, the website made 20% more than its planned revenue. I wonder why…

Red: CPC, Solid: ’23, dotted: ’22. Drop of 51%

Blue: Clicks, Solid: ’23, dotted: ’22 Increase of 124%

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