Pay-per-click advertising is a major industry these days, and many clients of ours are (rightfully so) interested in online advertising campaigns. What comes as a surprise to them, however, is our answer when they ask if online advertising is right for their business. We tell them “maybe.”
When it comes to online advertising, whether or not it’s a good idea comes down to a cost/benefit analysis. This approach is somehow radically different from other marketing agencies, who rush their clients into a paid campaign without first looking at whether or not paid advertising is going to help the client specifically.
Is Online Marketing Right for Me?
Let it be said that in most well-optimized campaigns, online advertising is an easy yes. There are more than enough analytic tools that will help you refine and target your campaigns to create the most effective spend possible and to enjoy a beautiful return on investment. So why would we say maybe when we’re almost always going to ensure that a client has a highly-optimized campaign?
When is Online Advertising a Bad Idea?
There are a few reasons that you might not be ready for or a perfect candidate for online advertising. Why a specific business might not flourish in paid advertising online include:
- The wrong audience/medium. If you own a restaurant, you probably hate YELP but know it’s a necessary evil. If you ask YELP, every business can benefit from their services. The truth is that some businesses aren’t going to do well on YELP. If you run a restoration business and your customers are searching for help while watching their home burn down, the chances of them choosing to look on YELP instead of Google are abysmal. A restaurant could thrive with YELP advertising, but reaching an audience looking for help cleaning up after a fire in their home, YELP is the wrong choice.
- The cost of advertising is too high. Some specific industries and key terms are worth roughly $40-150 per click. If the return isn’t going to cover those costs, a local business might be up against national players with deep pockets. If that’s the case, the general cost for a visit to the website is prohibitive and the owner can spend more than they make in return trying to keep up with national companies. A good example of this would be solar installation services, where a 2-man company might be trying to buy advertising against national companies like Solar City and Home Depot. This isn’t an impulse buy, so even without AdWords smart consumers will likely find the relevant websites/companies and hundreds of dollars a week in advertising could hurt a 2-person start up.
- The returns are too low. We typically create client websites that we know are going to perform well in the wild. Sometimes, however, when a client has a poor website and comes to us specifically to purchase paid advertising and manage online campaigns (only), we’ll turn them away because the cost-per-conversion will be too low. Remember that paid advertising directs new users to a website or other property. If your business can’t convert those users to customers, you’re simply paying people to decide not to use your company. Paid advertising is amazing icing on the cake of a great website, but can be killer when you pay to drive traffic to a bad website.
- Sometimes, people do a lot of research before they purchase. If you run a hotel, you have to include the cost of people clicking your ad while daydreaming about travel, or getting a feel for what the area looks like. That means that if one in three people are actually looking for a hotel and not just dreaming about an unplanned vacation, you have a 33% chance of getting a return on your investment and may end up paying roughly $150 to book a $300 stay.
These are just some of the reasons online advertising should be questioned prior to driving straight in. Most times, even the above challenges can be worked around, but there are things to consider. If you are already the top result in a field where people competitively shop, it’s safe to think that your site will be included in their evaluations, even if a competitor or two are appearing above you in paid ads. Other times, you may really want to embrace online advertising because you have a strong website and yet you’re not in the top results for certain search terms (for instance, you’re running a condo resort and want to capture people looking for hotels).
Which Social Media Platform is Best to Use to Advertise My Business?
One online advertising platform/social media network may not work as well as another. In the instance of the restoration company, Google is a dream come true, while Facebook and YELP ads are going to be seen by a lot of people who don’t have a flooded basement. Your ad is just not important to them, at that time. If you flood the market, maybe you’ll see the difference you’re looking for, but at what cost? I always think of the words of an old mentor, great marketing is reaching the right people, at the right time, with the right message. Does online advertising deliver that for you? Only you can decide, but when you do, question everything.
When you decide to purchase online advertising, start safely and measure! You really can’t tell anyone if online advertising is going to make a small difference or a massive change in their profits. Until you try it, you simply don’t know, but don’t go too big out of the gate. Start with a reasonable amount and measure your campaign. If you’re using Google AdWords, make sure to take a call with your rep as soon as possible–they’ll help you optimize your campaign and can see what others in your industry are doing. Don’t pass up that free (and wonderful) resource.